Utah’s Residence Lien Recovery Fund is Officially Depleted. What now?

June 12th, 2026

Salt Lake City – The Utah Department of Commerce’s Division of Professional Licensing (DOPL) announced that the Residence Lien Recovery Fund (LRF) is now depleted. 

History of the LRF

Enacted by the Utah State Legislature in 1994, the LRF was designed to protect homeowners from “double payment.” This occurred when a homeowner paid their primary contractor in full, but the contractor failed to pay their subcontractors or suppliers, resulting in a property lien.  The LRF allowed DOPL to pay the subcontractors or suppliers who placed property liens on homes.  

The fund was financed by contractor licensing fees. However, by 2017, the claims had drastically decreased, potentially due to the implementation of the State Construction Registry, an online tool designed for homeowners, contractors, and subcontractors to track payments on a residential construction project. Because the costs of running the LRF program outweighed the payouts, the legislature ultimately decided to stop funding it in order to relieve the financial burden that was placed on responsible contractors to cover the cost of a handful of “bad actors.” The remaining $2 million LRF balance had been winding down over the last decade and is now gone. 

How Homeowners Are Still Protected

Despite the fund’s depletion, homeowners are still legally protected from paying twice for the same work through a Certificate of Compliance. 

If a subcontractor places a lien on your home, you can apply for this certificate through DOPL by proving you did your due diligence as a consumer, such as: 

• You established a written contract.
• You hired a licensed contractor.
• You paid the contractor in full. 

Once DOPL issues the Certificate of Compliance, the lienholder is legally required to remove the lien from your residence within 15 days. 

What Unpaid Subcontractors and Suppliers Should Do

The LRF is no longer available as a last resort financial safety net; unpaid subcontractors and suppliers must rely on standard legal avenues to collect against contractors that owe them, as with any other business dispute. 

DOPL has resources available to the public to help with their residential construction projects. Review our Home Improvement Success Guide, utilize our Residential Construction Agreement template, and track your project on the State Construction Registry. 

You can learn more about the Residence Lien Recovery Fund, along with the full list of requirements to apply for a Certificate of Compliance, on DOPL’s website at dopl.utah.gov/residence-lien-recovery-fund.