RME/RMO & License Renewal

As a comedian would tell you, ‘timing is everything’. However, sometimes you just can’t help getting caught between the proverbial rock and a hard place. As I share with our first contractor, that situation is even trickier when the ground rule is also ‘unstable.’ How much money does a Nevada contractor need to ‘roll the dice’ on a California license? And a follow up from the Attorney General on recent alerts you’ve read here…

Q: My Responsible Managing Employee (RME) left the company last month. I have filed an application to replace him; however, what should I do with my renewal, which asks for the Qualifier’s signature? My license is due to expire at the end of the month. Help!

A: This is an issue that has plagued contractors for years. What to do when a RME or RMO leaves the license at the same time a renewal is due to be filed. The renewal application asks for both the Qualifier’s signature and if applicable, the signature of an officer or partner. Of course, if the Qualifier is an officer or partner – or a sole owner – this would not be an issue.

The Board’s policy has changed several times over the years but as of this column I can only address what it is today. In your situation, it is unlikely the CSLB will process your renewal without the new Qualifier’s signature. And his signature will not be valid until he becomes the official Qualifier.

I suggest filing the renewal with your signature as President and have the new RME sign where indicated. Also file a Notice of Disassociation and ask the CSLB to quickly process your replacement application. Hopefully the new Qualifier will pass his test and his fingerprints will clear quickly so he can be added onto the license prior to the end of the month. Coordination between the Board’s RME/RMO (replacement) and renewal units is critical to this being completed on time.

In the past, the Board would allow a renewal to be processed with an officer’s signature alone if a replacement application and Disassociation Notice had been filed. My personal feeling is the CSLB should not penalize the company if a Qualifier abruptly leaves at the end of the two-year licensing cycle.

Q: I just finished my application process for Nevada. I’m now looking at obtaining a license in California. It does not appear that financial or bank statements are required or there is even a form for this information. Am I missing something?

A: No financial or bank reports are required for licensure in CA. The only requirement in this regard, is responding YES to a question on the application, which asks, “Does your operating capital exceed $2500″. For years, California has made the determination that this is the minimum amount a contractor must have to be considered financially viable.

Contractors Update: In a recent press release, Attorney General Jerry Brown announced that he has filed lawsuits against eight individuals and six businesses that operated scams targeting small business owners. The lawsuits, seek to recover more than $3 million.

“These cases will send a powerful signal that small business owners must be on the alert,” Brown said. “These rip-off artists sent official-looking documents through the mail for the sole purpose of duping small business owners into paying them money – for no value in return.” 

The three cases involved mailed solicitations that appeared to be government documents featuring an official-looking seal, an official-sounding name, citations to the Corporations Code and a “reply by” date. As previously indicated in this column, the mailed forms claim that the business was in danger of losing its corporate or limited liability status if payment was not made within a short period of time. Simply, not true.

This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply