California Contractors License Renewal

Like Winston Smith in Orwell’s “1984”, contractors are also discovering that government wants them to believe that ‘less is more’ when it comes to fees they pay for licensing. The fees remain the same, but you’ll be getting less for them. First, a lawyer discovers that government workers can also give the ‘wrong’ answer to the ‘right’ question…

Q: A few days ago, my client phoned the CSLB and asked about his license. Whoever answered looked up the license history and told him his license was renewed retroactively because the expiration date had not changed. As you can see from the attached license verification, the license was renewed to January 31, 2010 or 2 years from the expiration date of January 31, 2008. However, the attached Certificate does not show a retroactive reinstatement of the license.

In your opinion, based on the information summarized above, is there a reasonable probability that the license either was retroactively reinstated or that it could be retroactively reinstated before an upcoming trial date?

A: Unfortunately your client was misinformed. When a license is renewed late, the expiration date does NOT change.

I am sorry to say, that I do not see any “reasonable probability that the license could be retroactively reinstated”. There was no retroactive renewal last year and with a five-month gap, I cannot see the CSLB changing their records. There does not appear to be any error on the part of the Board, which as we discussed, would be the primary reason they would reverse themselves at this juncture.

Q: I have a corporation that was suspended due to problems with the Franchise Tax Board (FTB) and Secretary of State (SOS). I just resolved these issues and my company should be back in good standing within a week. My problem is that the CSLB will not process my renewal application while the corporation’s status is suspended. Is there a way to retroactively renew the license so this expiration will not show on my record? My attorney informed me that even if a license is expired for one day this can cause problems months or even years down the road.

A second question: What happens if a corporate license is suspended for this same reason prior to expiration of the license?

A: The Board’s procedures allow a company to continue operating under a prior renewal even if they discover the corporation is suspended by the SOS/FTB. The Board would be justified in immediately suspending the license but they rarely do so. On the other hand, if an application for renewal is submitted it will not be renewed due to unpaid FTB taxes or issues with the SOS. The Contractors Board requires that these issues be resolved prior to renewing the license. According to section 7141.5 (B&P Code), The registrar may grant a retroactive renewal of a license if the licensee files a petition within 90-days of the renewal date and shows that “the failure to renew was due to circumstances beyond the control of the licensee”.

According to a recent governor’s press release, beginning July 10, most state offices will be closed the first, second and third Friday of every month through June 2010. This requirement that state employees take unpaid furloughs will undoubtedly slow up the processing of license applications, testing, and complaint investigations. I have written this before, but it bears repeating: contractors are paying for the privilege of getting less service. The CSLB is totally funded by contractors through their renewal, application and other fees. While I understand that it would be difficult to single out the CSLB, forcing them to close does not save the State one-dollar of general fund money and does little or nothing to close the huge budget deficit.

This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply