ORC Chapter 4722: Ohio's Home Construction Contractor Rules

What ORC Chapter 4722 Actually Covers

ORC Chapter 4722 — the Home Construction Service Suppliers Act (HCSSA) — is Ohio's primary consumer protection statute for residential construction. It applies to any contractor who enters a contract to build, remodel, or renovate a one-, two-, or three-family dwelling when the contract value is $25,000 or more.

A critical legislative update took effect on September 20, 2024. Before that date, the HCSSA primarily applied to new residential construction. The amended law expanded coverage to include all residential remodeling, repair, and renovation contracts at or above the $25,000 threshold — work that previously fell under the Consumer Sales Practices Act (CSPA) with its treble damage exposure.

The Written Contract Mandate

You cannot legally perform residential work at or above the $25,000 threshold without a written contract that contains all of the following:

• Your full business name, physical address, and taxpayer identification number (EIN)
• Your phone number
• A detailed description of all services to be performed and materials to be provided
• A complete cost estimate or firm fixed price
• Estimated start and completion dates
• A copy of your certificate of general liability insurance

Missing any of these elements classifies the contract as deficient under ORC § 4722.02, which the Attorney General can treat as a deceptive practice.

The 10% Deposit Cap

Under ORC Chapter 4722, a contractor cannot demand a down payment exceeding 10% of the total contract price before work begins. The only exception is for special-order materials — custom windows, imported stone, fabricated steel — where the deposit is capped at 75% of the special-order item's cost.

Demanding excessive deposits before commencing work is classified as an unconscionable business practice under ORC 4722.03 and can trigger civil litigation by the Attorney General.

The Excess Cost Notification Rule

If unforeseen but necessary work pushes the total project cost more than $5,000 above the original estimate, you must get written or verbal approval from the homeowner before performing the additional work. This notification requirement doesn't apply if the original contract was for a firm, fixed price.

This rule catches contractors who habitually underbid to win projects and then tack on change orders. The homeowner has the right to decline the excess work, and proceeding without approval exposes the contractor to enforcement action.

Insurance Requirements

Contractors covered by ORC 4722 must maintain commercial general liability insurance of at least $250,000. A copy of the insurance certificate must be physically attached to the written contract — not just available on request. This is a contractual disclosure requirement, separate from any municipal insurance minimums.

Note that municipal registration requirements often exceed this floor. Columbus requires $300,000/$500,000 liability limits. Cleveland requires $200,000. Cincinnati requires $100,000/$300,000. The HCSSA's $250,000 minimum is the state-level floor, not the ceiling.

What ORC 4722 Replaced

Before the September 2024 amendments, large remodeling and renovation projects fell under the Consumer Sales Practices Act (CSPA), which allows treble (triple) damages in consumer lawsuits. The HCSSA shift shields contractors from that treble damage exposure on contracts of $25,000 or more — but only if the contract meets every disclosure requirement.

Contracts under $25,000 still fall under the CSPA, which means smaller jobs actually carry higher per-dollar litigation risk than large ones.

AG Enforcement Powers

The Ohio Attorney General's Consumer Protection Section enforces ORC 4722. The AG can:

• Investigate contractors based on consumer complaints or anonymous reports
• Subpoena business records
• Seek injunctions and cease-and-desist orders
• Impose civil penalties up to $25,000 per violation
• Pursue consumer restitution orders

Getting Contracts Right

The Ohio General Contractor License Guide includes the specific contractual disclosure requirements under ORC 4722, mapped against the separate municipal registration requirements for each major Ohio city. Getting both layers right — the state contract mandates and the local compliance requirements — is what keeps residential contractors out of enforcement proceedings.

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