On Friday, October 2, four Holtzman companies filed for Chapter 7 liquidation bankruptcy, and Holtzman Construction and Holtzman Remodeling voluntarily canceled their licenses with the Arizona Registrar of Contractors. Homeowners were left with unfinished projects, and three customers interviewed by FOX 10 reported paying more than $800,000 combined for abandoned work.
If you are studying for the Arizona ROC Statutes and Rules exam, this story is a real-world case study of the exact material the test covers: license cancellation, the Recovery Fund, complaint rules, and what a bankruptcy filing does and does not change. Here is what happened, what it means, and which numbers to memorize.
What happened
According to FOX 10 Phoenix reporting, the Holtzman companies stopped returning calls and pulled their online presence in mid-September, leaving homeowners with unfinished remodels. One Mesa homeowner paid more than $12,000 for a kitchen renovation that stalled. Another customer paid over $400,000 on a $680,000 contract for a commercial office build, with less than a third of the work completed.
The ROC's records show more than 150 complaints filed against Holtzman companies since 2010, including 45 against Holtzman Construction since 2024. The companies' licenses now show as voluntarily canceled on the ROC website.
Federal court records confirm the filings: Holtzman Construction LLC (case 26-10067) and Holtzman Remodeling LLC (case 26-10068) filed voluntary Chapter 7 petitions in the District of Arizona on October 2, 2026. Chapter 7 is liquidation, not reorganization. The companies are winding down, not restructuring.
What bankruptcy does not change
This is the part the exam tests. ROC Director Tom Cole told FOX 10 that a bankruptcy filing does not stop the agency's investigative process and does not stop a homeowner from applying for an award from the Residential Contractors' Recovery Fund.
The ROC's own Recovery Fund FAQ says the same thing directly: as a general proposition, a contractor's bankruptcy filing cannot divest the Registrar from authorizing a payout to an eligible homeowner. There can be exceptions, so affected homeowners should talk to a bankruptcy attorney, but the default rule is that the claim can still proceed.
If you are taking the Statutes and Rules exam, file this under "things the test wants you to know cold": bankruptcy does not erase ROC authority, and it does not block Recovery Fund claims.
The two numbers that decide everything
The Recovery Fund has hard statutory caps, and they are the reason this story matters beyond one company:
- $30,000 per claimant. The maximum one homeowner can recover from the fund for a residence.
- $200,000 per contractor's license. The maximum the fund will pay out against a single license, total. Once $200,000 has been disbursed against that license, no further payments are allowed.
With three interviewed customers alone reporting more than $800,000 paid for abandoned projects, the math is ugly. Even if every one of them were fully eligible, the per-license cap means most of the losses cannot come from the fund. Director Cole has said the caps are set by statute, set years ago by the legislature, and the ROC is pushing lawmakers to raise them.
These two numbers already appear in the Arizona license exam study guide as must-memorize figures. Now you have a news story to attach them to, which makes them much harder to forget.
Voluntary cancellation vs. discipline
One detail worth understanding: the Holtzman companies voluntarily canceled their licenses. That is different from the ROC revoking or suspending a license after discipline.
A voluntary cancellation means the licensee gave up the license on its own. Revocation and suspension are disciplinary actions the Registrar imposes after violations. The exam distinguishes these, and real cases like this one show why the distinction matters: a company can walk away from its license while the agency's investigation continues anyway. Canceling the license did not end the ROC's authority over the underlying conduct.
What affected homeowners can actually do
If you hired one of these companies, or you are advising someone who did, the official path is:
- File a complaint with the ROC. Complaints are the trigger for agency action, and the complaint process is separate from any court case. You can look up a contractor's complaint history on the ROC website going back two years.
- Apply to the Residential Contractors' Recovery Fund. Start at the ROC Recovery Fund page. Eligibility rules are specific, and awards cannot exceed the amount needed to complete or repair the project.
- File a consumer fraud complaint with the Arizona Attorney General if you believe you were defrauded. The AG's office has not commented on whether it is investigating the Holtzman companies.
Subcontractors who were not paid generally have a different and narrower path: mechanics lien rights and the court system, not the Recovery Fund, which is built for homeowners living in the property.
Why this belongs in your study plan
Law exams reward people who connect rules to real situations. The Holtzman case touches at least five testable areas in one story:
- Recovery Fund caps: $30,000 per claimant, $200,000 per license.
- Bankruptcy does not block ROC investigations or Recovery Fund payouts.
- Voluntary license cancellation is not the same as disciplinary revocation.
- Complaints drive agency action, and the ROC publishes complaint history.
- The Recovery Fund pays homeowners, not unpaid subcontractors.
When you drill practice questions, every question built around one of those rules should now feel familiar. That is the whole point of studying with real cases.
Try the free practice quiz
Want to see where you stand on the Statutes and Rules material right now? Take the free 12-question Arizona SRE practice quiz. You will get your score with explanations for every answer, so you can see exactly which topics need work. Start the free quiz
Sources: FOX 10 Phoenix reporting on the Holtzman bankruptcy filings (October 2026); Arizona Registrar of Contractors Recovery Fund page (roc.az.gov); Bankruptcy Observer case records for Holtzman Construction LLC (26-10067) and Holtzman Remodeling LLC (26-10068), District of Arizona.