“Renting” a CA contractor’s license, RMO & RME Qualifiers

Abe Lincoln first wrote about fooling some of the people all the time and all the people some of the time. About the only person who can ‘fool’ you anytime is…you. When you seek out advice going to the source is the best way to learn. However, some people get ‘fooled’ by ignoring the facts to hear what they want to be true…

 

I regularly visit The Contractor’s Board Headquarters in Sacramento.  While hand-delivering applications for clients, I often overhear discussions taking place between contractors and CSLB staff.  Sometimes these discussions also take place among contractors waiting in line.  On a recent occasion, one contractor conversed with both and herein lays the question:  When should I listen to the CSLB and when is it advisable to instead listen to the fellow contractor?

 

In this particular case the person at the public counter gave the contractor correct information.  The question related to an unsolicited mailing the contractor received promising a waiver of the license exam.  The skeptical contractor was rightly told what was required; when he can make application and what the law is regarding an exam waiver.

 

Yet, not two seconds later, he begin talking to another contractor in receipt of the same letter who basically told the first contractor to ignore everything he was just told by the CSLB employee.  As contractor #1 is exiting the building he thanks contractor #2 for “all the great information” and tells him he’ll go with his suggestions.   The problem as “contractor #1” will soon discover, is that by listening to “contractor #2” his application and request for a waiver will almost certainly be denied.

 

The CSLB is not perfect; they have been known to make errors; however, beware the contractor who is sure they have all the answers.  In my many years assisting the construction industry, I cannot count the times I’ve heard the words:  “A contractor friend of mine told me….” only to learn they were given incorrect information.

 

Q:  I am familiar with a contractor who is renting his license to a company however, I don’t think he’s the least bit involved with any of their projects.  I know this because he tried to recruit me to do the same thing.  He told me there are a few agencies on the Internet that line up Responsible Managing Officer’s (RMO), and set them up with contractors that may not otherwise qualify for a license.  Is this legal?

 

This contractor has his own active license and I know he uses it daily.  Aren’t RMO and RME qualifiers supposed to oversee the contract?  How can the CSLB let contractors get away with this?

 

A:  Contractors can qualify more than one license at a time if they own at least 20% of each entity.  This would explain how this contractor could qualify as a RMO yet continue to use his own personal license.  If he owned less than 20%, the State would have required that his license be inactivated.  This inactivation would be required in almost all instances if he were a RME.

 

I believe the vast majority of qualifiers are legitimate; however, “renting” a license in the way you describe does happen. The CSLB is aware that some contractors are likely abusing the system and I believe they are investigating. You may want to pass this information on to the CSLB who can determine if the arrangement is allowed.

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