Under Virginia law (Title 54.1), what is the minimum net worth requirement for a Class A contractor license?
Correct Answer
C) $45,000
Virginia requires Class A contractors to maintain a minimum net worth of $45,000 as specified in Title 54.1 of the Virginia Code.
Why This Is the Correct Answer
Under Virginia Code Title 54.1, Class A contractors must maintain a minimum net worth of $45,000. This financial requirement ensures that contractors have sufficient capital to handle large construction projects and meet their obligations to clients, subcontractors, and suppliers. The $45,000 threshold is specifically established in Virginia's contractor licensing regulations to demonstrate financial stability and responsibility for unlimited contract amounts that Class A licenses permit.
Why the Other Options Are Wrong
Option B: $25,000
$75,000 exceeds Virginia's actual requirement for Class A contractors. While this amount would certainly demonstrate financial capacity, Virginia law specifically sets the minimum at $45,000, making this option incorrect despite being financially sound.
Option D: $75,000
$25,000 is insufficient for Virginia's Class A contractor requirements. This amount may apply to lower classification licenses but does not meet the enhanced financial standards required for Class A contractors who can undertake projects of unlimited monetary value.
Memory Technique
Remember 'Virginia Class A = $45K' - think '4' for Class A and '5' for Virginia's fifth letter 'i', making $45,000.
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A Class B contractor in Virginia completed $850,000 worth of work in the current license period and has contracts totaling $1,200,000 for the next period. What action must the contractor take?