Commerce

Professional Licensing

Rule 38a: Residence Lien Restriction and Lien Recovery Fund Rule

Effective Date: 06/25/2026

Admin. Code Reference: R156-38a

Rule Type: Current Rule

NOTICE OF SUBSTANTIVE CHANGE

TYPE OF FILING: Amendment

Rule or section number:

R156-38a

Filing ID: 57902

Agency Information

1. Title catchline:

Commerce, Professional Licensing

Building:

Heber M. Wells Building

Street address:

160 E 300 S

City, state:

Salt Lake City, UT 84111

Mailing address:

PO Box 146741

City, state and zip:

Salt Lake City, UT 84114-6741

Contact persons:

Name:

Phone:

Email:

Daniell Shirley

801-530-6628

daniellshirley@utah.gov

Please address questions regarding information on this notice to the persons listed above.

General Information

2. Rule or section catchline:

R156-38a. Residential Lien Restriction and Lien Recovery Fund Rule

4. Purpose of the new rule or reason for the change:

The proposed rule changes address procedures for filing new claims against the residential lien recovery fund when the fund is no longer sufficient to pay claims.

5. Summary of the new rule or change:

Section 38-11-201 created an expendable special revenue fund called the "Residence Lien Recovery Fund."

The purpose of the fund is to reimburse qualifying parties for certain liens on residential properties.

Subsections 38-11-203(1)(c) and (2)(b) state that the Division of Professional Licensing (Division) need not pay out claims against the fund if the fund lacks adequate money. The proposed changes provide procedures when the Director determines that the fund has reached this level.

Rather than devote unnecessary resources to processing claims that cannot be paid out, the proposed changes allow the Division to continue accepting Lein Recovery Fund (LRF) claims that meet basic criteria on a provisional basis.

Final processing of these provisional claims will only be initiated when sufficient money has been added to the fund to allow for new payments.

If the fund is able to disperse new payments, provisional claims will be processed in the order received.

Fiscal Information

6. Provide an estimate and written explanation of the aggregate anticipated cost or savings to:

A. State budget:

The proposed changes establish procedures when the residential lien recovery fund can no longer pay claims to qualified beneficiaries.

The proposed changes are not expected to have any fiscal impact on state government revenues or expenditures.

B. Local governments:

The proposed changes establish procedures when the residential lien recovery fund can no longer pay claims to qualified beneficiaries.

The proposed changes are not expected to have any fiscal impact on local governments' revenues or expenditures.

C. Small businesses ("small business" means a business employing 1-49 persons):

The proposed changes establish procedures when the residential lien recovery fund can no longer pay claims to qualified beneficiaries.

The proposed changes are not expected to have any fiscal impact on the revenues or expenditures of small businesses.

D. Non-small businesses ("non-small business" means a business employing 50 or more persons):

The proposed changes establish procedures when the residential lien recovery fund can no longer pay claims to qualified beneficiaries.

The proposed changes are not expected to have any fiscal impact on the revenues or expenditures of non-small businesses.

E. Persons other than small businesses, non-small businesses, state, or local government entities ("person" means any individual, partnership, corporation, association, governmental entity, or public or private organization of any character other than an agency):

The proposed changes establish procedures when the residential lien recovery fund can no longer pay claims to qualified beneficiaries.

The proposed changes are not expected to have any fiscal impact on the revenues or expenditures of persons other than small businesses, non-small businesses, state, or local government entities.

F. Compliance costs for affected persons:

The proposed changes establish procedures when the residential lien recovery fund can no longer pay claims to qualified beneficiaries.

The proposed changes are not expected to have any fiscal impact on affected persons.

G. Regulatory Impact Summary Table (This table includes only fiscal impacts the agency was able to measure. If the agency could not estimate an impact, it is excluded from this table but described in boxes A through F.)

Regulatory Impact Summary Table

Fiscal Cost

FY2026

FY2027

FY2028

FY2029

FY2030

State Budget

Local Governments

Small Businesses

Non-Small Businesses

Other Persons

Total Fiscal Cost

Fiscal Benefits

FY2026

FY2027

FY2028

FY2029

FY2030

State Budget

Local Governments

Small Businesses

Non-Small Businesses

Other Persons

Total Fiscal Benefits

Net Fiscal Benefits

H. Department head comments on fiscal impact and approval of regulatory impact analysis:

The Commissioner of the Department of Commerce, Margaret Busse, has reviewed and approved this regulatory impact analysis.

Citation Information

7. Provide citations to the statutory authority for the rule. If there is also a federal requirement for the rule, provide a citation to that requirement:

Section 38-11-105

Subsection 58-1-106(1)(a)

Subsection 58-1-202(1)(a)

Public Notice Information

9. The public may submit written or oral comments to the agency identified in box 1.

A. Comments will be accepted until:

06/16/2026

B. A public hearing (optional) will be held (The public may request a hearing by submitting a written request to the agency, as outlined in Section 63G-3-302 and Rule R15-1.):

Date:

Time (hh:mm AM/PM):

Place (physical address or URL):

05/22/2026

10:00 AM

Heber M. Wells Building

Room 475

160 E 300 S

Salt Lake City, UT 84111

Google Meet joining info:

Video call link: https://meet.google.com/wjh-vhcp-amh

10. This rule change MAY become effective on:

06/23/2026

NOTE: The date above is the date the agency anticipates making the rule or its changes effective. It is NOT the effective date.

Agency Authorization Information

Agency head or

designee and title:

Adam Watson, Assistant Division

Director

Date:

04/16/2026

R156. Commerce, [Occupational and ]Professional Licensing.

R156-38a. Residence Lien Restriction and Lien Recovery Fund Rule.

R156-38a-202. Application Fees.

(1) Except as described in Subsection (2), application fees under Subsection 38-11-202(3)(a) for an application from a qualified

beneficiary or laborer seeking to make a claim against the fund shall be paid concurrently with the submission of an application.

(2) If the Director issues a notice that there is no longer adequate money in the fund to pay claimants under Subsection R156-38a-204d(1),

the application fee due under Subsection 38-11-202(3)(a) shall be deferred until payment is requested by the Division.

(3) After the Director issues a notice that adequate money to pay claimants has been allocated under Subsection R156-38a-204d(4), the

Division shall request filing fees from applicants in the order described under Subsection R156-38a-204d(3).

(a) The request for payment of application fees under Subsection R156-38a-202(3) shall be made by the Division to the email address

listed on the application.

(b) The applicant shall have 14 days to pay the application fee in full following a request by the Division with the first day being the day

following the date of the email described in Subsection R156-38a-202(3)(a) and ending 14 days thereafter at 5 pm Utah local time.

(c) If the applicant does not pay the requested application fee within the period described in Subsection R156-38a-202(3)(b), the

application shall be deemed incomplete and rejected.

(4) Payment of an application fee under Subsection R156-38a-202(1) or R156-38a-202(3) does not constitute a final determination of a

claim on the merits by the Division.

R156-38a-204d. Depletion of Lien Recovery Funds - Potential Claims -- Provisional Acceptance of Applications.

This section establishes procedures to be adopted in the event the Director determines there is no longer adequate money in the fund to pay

claimants under Subsection 38-11-203(1)(c) or (2)(b).

(1) The Director shall issue a notice that there is no longer adequate money in the fund to pay claimants. The notice shall remain in effect

until the Director issues a notice under Subsection R156-38a-204d(3).

(2) Upon issuance of the notice described in Subsection R156-38a-204d(1), the Division shall:

(a) cease processing applications or making payments under Section 38-11-203;

(b) suspend the application processing procedures described under the following Sections:

(i) R156-38a-105b;

(ii) R156-38a-203;

(iii) R156-38a-204a through R156-38a-204c; and

(iv) Subsections R156-38a-105a(5) through (9).

(i) 38-11-204(4)(d)(i);

(ii) 38-11-204(4)(d)(ii);

(iii) 38-11-204(2)(a);

(iv) 38-11-204(2)(b), (4)(d)(i), (4)(d)(iv), and (5); and

(v) Section 38-11-204.

(3) Upon issuance of a notice from the Director that adequate money to pay claimants has been allocated, the Division shall process

applications in the order received under this section after payment of deferred filing fees by the applicant under Subsection R156-38a-202(3) are

received.

(4) Provisional acceptance of an application under Subsection R156-38a-204d(2)(c) does not constitute a final determination of a claim on

the merits by the Division.

KEY: licensing, contractors, liens

Date of Last Change: [August 21, 2018]2026

Notice of Continuation: July 25, 2024

Authorizing, and Implemented or Interpreted Law: 38-11-[101]105; 58-1-106(1)(a); 58-1-202(1)(a)

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