How to Start a Driving School in Arizona: A Step-by-Step Guide

Here you’ll learn everything you need to start your Driving School in Arizona

As with many states, Arizona makes it pretty straightforward to establish a driving school in the state. Arizona driving schools can provide both the classroom and behind-the-wheel portion of driver’s ed.

Some driving schools can be licenses as a third party provider under the state’s policy of decentralization. You may also be able to administer the official written and road tests to your students, and the Motor Vehicle Division will then waive the official exams for them — and the MVD no longer will randomly select students with certificates to retest.

How to open your driving school in Arizona

• Arizona does not place many requirements on driving school owners or instructors other than some obvious ones.
• You are generally free to select any location for your school.
• You must keep records for three years.
• If you offer classroom instruction, Arizona has a set curriculum.
• You may be able to become a third party provider, and certify that your students have passed either the classroom and/or behind-the-wheel tests.
• CDL training is not required in Arizona, and you can set your curriculum as you would like.

Driving School Licensing and Requirements

General requirements

To operate a driving school in Arizona, you will need to be licensed by the state. Licenses are valid for one year, and are renewable. They expire at the end of the calendar year.

Driving school license holders (and driving instructors) must meet the following requirements:

• Passing an examination covering traffic laws, safe driving practices, motor vehicle operation, knowledge of teaching methods, and driving school laws.
• 21 years old and holder of at least a high school diploma.
• Satisfactory driving record.
• In addition, instructors must be physically able to operate motor vehicles and train others. The MVD may require a medical examination.

Applicants for a driving school license must submit the school application along with the $200 fee.

Applications for a driving instructor license must submit the application along with a $10 fee.

Driving School Owner’s License

Along with the application, you will have to submit a number of photos showing your signage, entrances, classroom, office area and secured records storage area, and school-front and neighboring store-fronts. Photos of the training area/track and your skill exercises are also required.

Plan to submit the following aslo:

• Samples of contracts
• Samples of receipts as well as all forms to be given to students.

Driving Instructor’s License

Driving instructors do not need to submit anything other than the application.

Insurances

You must maintain insurance on all motor vehicles used for driving instruction at your school. The minimum coverage levels for each vehicle are:

• $10,000 for injury/death of one person in one accident.
• $20,000 for injury/death to two or more people in one accident.
• $5,000 for property damage in one accident.

Prudent school owners will maintain higher levels of insurance as well as an umbrella policy.

If you have employees, you will also need workers’ compensation insurance coverage.

Location

You are generally free to establish your business anywhere you see fit–meeting the requirements outlined below. You can choose to have classroom space for classroom instruction.

Your place of business must meet all local and state zoning and regulatory requirements. You’ll have to post your offices hours conspicuously. Staff members left in charge of the office when the operator is not present must be able to provide all information about the school to the public and to the Motor Vehicle Division on request. Office staff do not need to be licensed driving instructors.

If your school is in a office building, store, or non-dwelling structure, there must be a clear separation between the driving school and other activities. You may operate out of your home, it appears.

You must display the school license and all instructor licenses conspicuously.

Records must be available in your office for inspection during normal business hours.

Records and Contracts

You will need to keep records of all students for at least three years after they finish their training with you. The MVD may inspect and make copies records at anytime. Arizona requires a permanently bound book or cardfile containing the required records.

You must keep the following records in the permanently bound book or card file:

• Name, address, contract number, and terms of payment for each student receiving instruction.
• Dates, types, and duration of all lessons given in vehicle, along with the tag number, make, and model of the vehicle.

In addition, you must keep a record of all receipts and disbursements. A copy of each contract with each student must also be in your files.

The Driving School Curriculum in Arizona

Arizona mandates the specific topics covered by the curriculum for every driving school, both for the in-class as well as the behind-the-wheel portions of driver’s education. You are, of course, free to add information.

Your classroom course must last for at least 30 hours, and the behind-the-wheel course must last for 6 hours.

Arizona expects the classroom portion of the course will cover the following topics; they are discussed in detail in the Curriculum Standards. Arizona has set up its standards in a recommended but not required sequence.

• Preparation for operation–knowledge of the course requirements, laws, and the need to inspect vehicles.
• Understanding Vehicle control need, including vision, steering, and vehicle balance
• Traffic entry skills
• Intersections, Curves, and Hills
• Space management and vehicle control in moderate risk environments
• Traffic flow and space management below 55 mph
• Complex environments above 55 mph
• Factors affecting driver performance
• Dealing with adverse conditions
• Other roadway users
• Responding to vehicle malfunctions and crashes

The behind-the-wheel components for a full course include the following standards:

• Preparing to operate the motor vehicle
• Traffic entry and intersections
• Visual and mental perception for vehicle control
• Assessment of driver performance

If you are a participating 3rd party Driver License trainer, you will be able to test your students, either in the classroom component or the behind-the-wheel component, or both.

If you are providing the behind-the-wheel certification, you will have to follow the road evaluation scoring rubric in the standards, as well as develop at least 3 testing routes. The MVD recommends using a standard script for all students for each route, to ensure fairness in evaluation.

Commercial Driver’s License Instruction

Professional driving schools in Arizona may provide instruction for CDLs–attending a training course is not required. The state does not mandate a set number of hours, or a particular set up.

Starting a Small Business in Arizona

Your driving school is not just subject to the requirements for driver’s education in Arizona. You also need to establish your Driving School as a small business, and have to consider a number of factors. The form of business you take up, as well as the procedures, are appropriate topics of conversation with your lawyer and accountant. The considerations we offer here are not legal advice, but should provide you with things to think about as you set up your business.

Business Registration

All businesses need to register in Arizona, especially the business name—the “doing business as” certificate. Banks may not be willing to set up your account until you have that DBA form. We’ll include where to register in the business structures below.

You will also need to obtain a Federal Employer Identification Number. Banks may need it for your business accounts, and you may be wanting to employ people. To obtain an EIN, go to the IRS website and complete the application form you find linked there.

Business name

Before you get going, you’ll want to check to see if the business name you want is in fact available in Arizona. You can search the Arizona database, if you are planning to form a corporation or LLC. You’ll be able to reserve it right away at that site, if it’s available. Note that you will have to include LLC or Inc. in the name search.

Sole Proprietorship

Owning your own business is the easiest one to set up, but also may open you to liability concerns. As a sole proprietor, your business is simply part of your life. You keep a separate set of books, and complete a Schedule C for your 1040 form every April.

Sole proprietorships can expose the proprietor for full liability, even with insurance. That may mean that if you are sued, you may lose your home and property, as well as your personal bank accounts and other assets. This risk may not be worth the ease and independence.

In Arizona, the big step you have to take is to register your Assumed Business Name with the recorder of each county in which you have a place of interest.

While it is not required for a sole proprietor, you may want to file a trade name registration with the Arizona Secretary of State.

Corporations and LLCs

You may set up a full corporation (“Inc.”) as your business structure. Corporations limit your liability for loss to your investment in it, as a general rule (although banks may require you to be obligated personally if you take out a loan to get your business going). This form of business keeps your personal assets safe.

As an owner of a corporation, you’ll have to set up your driving school consistently with the rules for corporations in Arizona–those rules can be found at <this state run website>. You’ll also have to decide whether to be an S Corporation or a C Corporation. Generally, the S Corporation form is set up for small businesses. It allows income and taxes to pass through to the owners. You will want to discuss these forms with your attorney and accountant.

You may be able to set your driving school up as an LLC in Arizona. The LLC form provides the same limited liability as a Corporation, but do not have to comply with the corporate formalities most states require, including items like bylaws, required stockholder meetings, and minutes (although minutes of meetings are probably a good idea).

The Arizona Corporation Commission provides a short guide.

You’ll have to discuss the advantages and disadvantages for the LLC with your attorney and accountant.

Both Corporations and LLCs file with the Secretary of State. Forms for both LLCs and Corporations are available from the Arizona Corporation Commission.

Now What Do I Do?

Once you’ve complied with all the legal requirements to be both a driving school and a small business in Arizona, you need to get students.

Getting students requires marketing—largely on the internet. You will need the following systems set up to obtain students.

• A website—focused on the types of students you want to attract, and aimed at your locality.
• The website should also include a blog, which allows you write about a variety topics and engage in Search Engine Optimization—which will drive traffic to your site.
• A Facebook page, linked to your website, to become noticed and drive traffic.
• Getting testimonials from successful students.

Marketing is something you will have to devote time to. DrivingSchool.Marketing can help you get the best bang for your marketing buck.

Conclusion

Disclaimer: This page is part of DrivingSchool.Marketing’s series of state and provincial pages designed to help entrepreneurs like you start driving schools. States change their regulations, or the web pages they host their forms. While we believe these rules are accurate as of the date of publication, we cannot guarantee full accuracy. Please let us know if you spot any problems.

The following two tabs change content below.

• Bio
• Latest Posts

Josh Meah

Josh is the CEO of DrivingSchool.Marketing. His goal is to be the marketing and business development partner of driving schools around the world, helping them become thriving businesses while also expanding general awareness for the importance of traffic safety standards and education.

Latest posts by Josh Meah (see all)

• 7 Reasons Your Driving School Should Offer Lesson Packages (They Will Grow Your School) - April 24, 2018
• Yelp Burns Driving School Ad Budgets (Don’t Waste Your Money There) - April 10, 2018
• How To Protect Your Driving School From An Instructor Who Leaves To Compete With You - April 10, 2018