Q:  I have a bid limit in Nevada of $250,000.  I have a customer who wants me to do a project for them that will be well above $500,000.  Is there any way to increase my bid limit?  How quickly can this be done?

A:  There are two ways to raise your bid limit in Nevada.  You can complete a One Time Raise in Limit application, or you can submit a Permanent Raise in Limit application.  For a single project such as you are describing, you can submit the application for a single project limit increase at least five working days prior to the bid date.  If submitted in that time frame, the application will be approved prior to bidding the project (assuming you meet the financial requirements of course).

Q:  You helped my company get a CA license 18 years ago and I have another question for you.  I am an “A” Contractor (General Enginering) and I heard recently that I could have an electrician on payroll that is not certified by the Division of Apprenticeship Standards.  Is that correct?

A:  That is indeed correct, only a “C-10” (Electrical) contractor is required to have their electrical employees certified by the Division of Apprenticeship Standards (DAS).  An “A” is not required to have their employees certified through DAS even if performing the same type of electrical work.

Q:  I currently have a Sole Proprietorship contractor’s license and I am in the process of incorporating.  Since I will be the only shareholder, will the corporation be assigned my existing license number?

A:  That’s your choice to make.  When you submit the license application for the corporation, you are required to also submit a “Licensed Sole Owner Applying for Corporate License” form (available on the CSLB’s website or by calling Capitol Services).  The CSLB allows a Sole Ownership license number to be reissued to a corporation if: 1) The Sole Ownership license is in good standing, 2) The corporation was formed by the individual licensee, and 3) The Sole Owner licensee has at least 51% ownership of the new corporation.  You should be aware that once the number is transferred, it belongs to the corporation and cannot be reissued to an individual at a later date.

Q:  Can you confirm that we can use the license owned by our Parent company or a company of our same Group, such as a sister company?

A:  No, you cannot use a license that doesn’t belong to your company, even if the company is “related”.  Each entity performing contracting work is required to have it’s own contractors license.  As a subsidiary of the Parent company, you may be able to use the same Responsible Managing Employee (RME)/Responsible Managing Officer (RMO) that is currently qualified for your Parent, however you will be issued a separate license number.

Q: We’re an out-of-state full service contractor. One of our clients has asked us to handle construction management for the site prep on a new project in Nevada. We will subcontract all work to local contractors who of course will be properly licensed in the area of the project. What licensing will the state require of us?

A:  Even as a Construction Manager sub-contracting all the work to licensed contractors, you will be required to have a Contractor’s License in Nevada.  Bidding on work and signing contracts for construction work requires a license.  It sounds as if the A-7 (Excavating and Grading) classification is what you will need if you’re doing site work.  There is no trade test for the “A-7” in Nevada, so only the Business/Management exam will be necessary.

Q: I hope you can help me. I was laid off from a telephone company last year and want to restart my cabinet shop. Prior to working for the phone company I spent approx. 10 years in construction as a finish carpenter handling residential and commercial cabinetry. Basically I have a ton of experience, but my verifiable experience is more than a decade old.  Will that qualify me for a “C-6” license?

A:  The CSLB will only consider work experience that occurred within the last ten years, so unfortunately it doesn’t appear that you will qualify at this time.  Note if you have a 4-year college degree, the State may credit you 2 years in lieu of experience depending on your field of study.

Q:  I’ve seen on the CSLB website where a homeowner can qualify for a Contractor’s License, but I’m not sure how that process works (the site is a bit confusing). Any words of wisdom will be truly appreciated.

A:  The CSLB will give partial work experience credit to individuals who have done work on their own property as owner/builder.  However, it is difficult to qualify for a Contractor’s License solely based on this basis.  For example, it may have taken you a year and a half to build your home, but the CSLB may only grant you 6 months for that work.  Even if you have worked on or built several properties, the Board is very tough in granting this type of experience credit.   You’ll likely need to show other work or educational background.

Q: Q: We are going to need to replace the Responsible Managing Employee (RME) on our license once again. You helped us with the application process originally, but this will be our third time in the last year. Is the Contractors Board going to hold this against us?

A: This is not an issue. The Board will not hold it against a company if they replace their Qualifier several times in a year.  There is however, a “rule of three” for individual Qualifiers. You can only personally qualify up to three licenses in any one year.

Q:  We’re a class “A” contractor, and have some interest in expanding into the solar energy installation business.  Does my “A” license cover this?  Would I need to get a “C-46”(Solar) specialty license?  If a “C-46” is required, does having an “A” license make me eligible to add this classification?  Thank you for offering your services, it is very helpful!

A:  Section 7056 of the B&P Code (the definition of an “A” contractor) includes the words,  “in connection with fixed works requiring specialized engineering knowledge and skill”. According to Board rule 832.62, this phrase includes an “active solar energy system”.  Therefore with an “A”, you can do this work without needing to apply for the “C-46” (Solar) classification.

If you decide to apply for the “C-46″, you’ll need to show at least 4 years experience handling, supervising or managing solar projects to qualify. Simply having an “A” does not, in and of itself, make you eligible to sit for this exam.  Thank you for the question.  I hope our response is helpful.

Q:  I’m having a problem with our business name.  We applied for a license under our corporate name, “XYZ Solar Company”.  However, the Contractors Board rejected the application telling us the name was not compatible with the license class (General building) held by our Responsible Managing Officer (RMO).  I read in one of your recent columns that a “B” could perform solar work so why can’t we use the “Solar” name in our business?

A:  The Board’s policy (as detailed in Code section 7059.1) is to disallow any business name that they determine to be misleading.  It is subjective, but generally, requests to use a word like “solar” where the applicant does not hold the specific classification code (i.e. the “C-46”) are not approved.  I say subjective because a random search of business names has turned up use of the word “solar” being allowed with a “C-10”(Electrical).  You may want to send a letter appealing the Board’s “decision” or amend the name to include a modifier like XYZ “General” Solar Company.

Q:  I was just finishing your book (“What Every Contractor Should Know” David Kalb, author), and I couldn’t find all the answers I needed. Currently I am the Operations manager but I have been asked to become the RME for my employer.  I have successfully taken the law and two trade tests and the former RMO/RME was just disassociated, but I am still concerned in regards to the RME position.  Any ideas or comments on the following: 1) What kind of control do I need to have?  2) Should I look for additional compensation?  3) Do I need to consult an attorney regarding a contract?

A: Board Rule 823, primarily answers your question regarding “what kind of control” you need.  For one, you must be a “bona fide employee” actively engaged in your employer’s business “for at least 32 hours or 80% of the total hours per week the business is in operation, whichever is less”. For a more complete response, check out page 76 of my book, or contact Capitol Services.

I cannot address your second question regarding compensation; this is up to you and your employer.   It you plan on having an employment agreement and/or contract questions consulting an attorney is likely a good idea.

Q:  We’re an out-of-state corporation that will be doing contracting work on a cruise ship.  The ship is due to dock in San Diego, where our employees will get on.  From there the ship will head out to Seattle and our crews “in tow”.  Do we need a CA license to do the work since it will be docking in San Diego?
A: Interesting question!  Our research indicates that you do not require a CA contractor’s license to work on this vessel. Bon Voyage!

Q:  I have a Sole Owner General building contractor’s license.  My buddy who is licensed in Oregon does plumbing work.  Can I add him to my license with the plumbing classification so that we can start doing plumbing and building projects?  When I contacted the Contractors Board, the guy I spoke with said I would need to form a corporation or partnership.  Is this right?

A:  The CSLB staff member was incorrect when he told you an individual could NOT add anyone to a Sole Owner license.   Giving him the benefit of the doubt, we believe he may have misunderstood your question.  Regardless, while you certainly have the option of forming a partnership or corporation to conduct business, you just as certainly can hire a Responsible Managing Employee (RME) — as long as it’s for a different classification than you hold.  Your friend will be required to show four years of plumbing experience and pass the law and trade exams.  He will also need to post a $12,500 Bond of Qualifying Individual and go through the Board’s fingerprinting process.

Q:  We’ve had a “C-39” (Roofing) license since 2007 with my son as the Qualifier.   He does not have the best credit so I would like to replace him.  His bad credit is preventing our partnership from getting bonding anymore.  Since we’ve had a license for 5 years I thought I could do this without taking the exam but the CSLB told me NO because we had to get a new license in 2009 when we added another partner.  They said since we got a new license and number they start the 5 years over again.  Are they correct even though we have been in business for 5 years under the same name and he and I are still partners?

A: Yes, the CSLB was correct. To be eligible for a waiver under Code Section 7065.1, you must have been on ONE license for 5 of the prior 7 years.  In other words, your time did start over again when you applied for the new Partnership license in 2009 (you were required to do so since any change in General Partners results in a license being cancelled).

While not part of your question, in researching your license status, we noticed that your license is suspended due to a Worker’s Compensation issue.  Aside from needing to contact your insurance company, it is important to note that to be eligible for a waiver the license must have been active and in good standing for the entire 5 year period.

Q:  I currently have a sole owner “B” license that’s been Inactive for years.  The company that I work for holds the “C-21” (Demolition) and “A” (General Engineering) classifications.  The current Qualifier is retiring and I’m in the process of purchasing the business from him.  I applied to replace him as the Qualifier and the CSLB approved me to sit for the “C-21” exam, but determined that I’m not qualified for the General Engineering classification even though I’ve worked for the company for over 5 years.  Isn’t overseeing “A” projects for over 5 years enough to qualify to sit for the trade test?

A:  When it comes to experience, the CSLB will want to see some hands-on Journeyman or Supervisory experience in your work history.  We suggest that you either reword your Experience Record form to better reflect your oversight of paid projects or try and work out an agreement whereby the seller remains on the license so you don’t lose the “A” classification.  If the Board will still not accept your revised Experience Certification, we suggest working to gain that additional experience so you can re-apply at a later date.  Also, in the meantime you can add your “B” classification onto the license with no testing required!

Q: I would like to obtain my Contractor’s License in CA and NV, but I recently filed a personal bankruptcy.  Will this prevent me from getting a license in those States?

A:  According to Shauna a personal bankruptcy alone should not prevent you from getting a Contractor’s License in California or Nevada.  There is a question on the NV application about whether you’ve filed bankruptcy. The Nevada Board will require that you submit your bankruptcy documents with your application but it’s not often a cause for denial.

The California license application addresses bankruptcies if you check “Yes” to question #10.  You’re required to attach a statement identifying all judgments (pending or on record), liens, past due unpaid bills, claims, or suits and a detailed explanation of the situation, including the names and addresses of the parties involved.  If the obligation was or is being discharged in bankruptcy, a copy of the filing and a copy of the creditors list are required.

While ultimately you should be able to get a license, the bankruptcy will adversely impact the amount you’ll have to pay for a license bond in each state (i.e. because most bonding is based on your credit score).

Q:  Our Company is hiring a new Qualifying individual.  He works for another company but will be leaving in order to become our Responsible Managing Employee (RME).  My question:  At what point must he leave the current license in order to become the Qualifier on our license?  Also what happens to this present employer’s license after he leaves?

A:  Your new RME should rightly Disassociate from his current employer’s license effective the last day of employment.  He will not be able to officially become your Qualifier until he has been removed from his present license. His  employer will then have 90-days from the date of Disassociation to qualify someone new.

Q:  Our Corporation has a CA contractor’s license with a fictitious business name.  When advertising or signing contracts do we need to use the full corporate name and dba name?

A:  You can use the FULL name (corporate and dba) or just the fictitious business name (dba) alone for advertising and contract purposes. In addition, you should always display the license number in advertising or signage.

Q:  I had a dispute with a customer a couple years ago and a judgment was filed on my license, which was later revoked.  I owe a rather large amount on this judgment but I need the license in order to work.  Is there a way for me to get the license reinstated by settling the debt with the CSLB?  Or can I just apply for a new license?

A:  Sorry, that’s a ‘line’ you can’t cross now. You will not be able to reinstate your license or apply for a new license until you prove to the CSLB that the judgment has been satisfied.  The debt cannot be settled with the CSLB, but rather needs to be settled with the customer who filed the complaint.

There are four acceptable ways to prove this:  1) Total payment of the debt; 2) show proof that a payment plan has been worked out with the creditor (the person/entity you owe the money would need to inform the CSLB in writing they are satisfied with your agreement); 3) File for bankruptcy, or 4) convince a court to reverse the judgment.

Q:  Hi, we have used your company a couple times to “cut the red tape” and I have a question for you.  My company installs countertops for “Big Box Stores” with a “C-29” (Masonry) license.  We have also started to install related fixtures like the sink and faucet.  Do you suggest we obtain a “C-36” (Plumbing) license in order to install the countertop/sink combos?

A:  Thank you for getting back in touch.  If you were just disconnecting and re-connecting a sink for the purpose of installing a new countertop, then no, you wouldn’t need the additional classification.  However, if you’re installing new plumbing connections and fixtures along with the countertop then yes, you should obtain a “C-36” license.

Q:  I have a general question regarding advertising in California and Arizona.  If an employee is in a non-sales role, is it still required that the contractor’s license number be listed on their business cards?

A:  Yes!  Your license number must be listed on anything that might be considered advertising, whether on your trucks, business cards, letterhead, etc.

Q:  My company has a current CA License and the Qualifier on the license is going to be leaving the company.  They have asked that I replace him on the license, however I have a Canadian Social Security number.  Will this be acceptable?

A:  No, unfortunately, because of the fingerprinting requirement, the CSLB requires that all applicants have a U.S. Social Security number.  The FBI and DOJ cannot run your prints with a Canadian number. For information regarding obtaining a Social Security number for non-citizens you can visit the Social Security Administration website at http://www.ssa.gov, or the company can choose another Qualifier.

Q:  I hope this email finds you well.  It has been some time since we talked/emailed!  I understand you are helping my brother with his General engineering license; that is great!

I’m still in my family’s contracting business, but I’m also practicing law.  My goal is to work with small residential contractors who have the potential to be eaten up by the state’s strict construction regulations.

I did run across an issue and I thought Capitol Services would be the best resource to ask.   Regulation 16 CCR §872.1, purports to require that a contractor provide the applicable checklist to a prospective homeowner client.  This regulation relies upon the authority found in Business and Profession Code § 7159.3; however, section 7159.3 was repealed in 2005.

Do you know if this checklist is still required or is this something the Board needs to clean up in its regulations?

A:  Good to hear from you again.  Yes, I am doing well, thank you.

Board Rule 872.1 (Checklist For Homeowners) still references section 7159.3, which, as you stated, was repealed.  I discussed your question with a former CSLB Legislative liaison.  To the best of his recollection, the Board did consider eliminating this regulation; however, it was discovered there was another code section, which referenced 872.1 so it was retained.

The State Legislature has made a number of revisions to home improvement contract requirements in B&P Code Section 7159; the most recent of which was last year.  If you reference sections 7159 to 7159.14 you’ll find the current specifications for home improvement contracts, which include NOTICE requirements involving Commercial General Liability Insurance (which is what 7159.3 addressed), Worker’s Compensation coverage, “Mechanics Lien Warning”, Three-Day Right To Cancel, etc.

I am sending you a CSLB publication entitled “Contracting For Success: A Contractor’s Guide to Home Improvement Contracts” which may be useful.  While this CSLB publication is written for contractors, it’s a very handy resource for anyone who deals with home improvement contracts.  For any of our readers interested in a copy of this publication, please contact Capitol Services or try any CSLB office.

Q: What will it take to get my license number activated? I’m living outside the country now and was just wondering.  It’s a fairly low number issued in the mid 80’s and I would like to use it when I come back to CA.

A:  According to my research this is a corporation license.  The CSLB will not allow you to reapply until it’s brought back into good standing with the Secretary of State (SOS).   SOS records show your company was “suspended” a dozen years ago and since the license has been expired since 1997, you may be looking at upwards of $25,000 to pay all back taxes, interest and penalties.  You have to ask yourself, how badly do I want to get this license back?

While this “fairly low number” may be gone, an alternative would be to apply for an individual license in your name.  You were the Qualifier on another license as recently as 2008 so this would be one way to avoid having to retake the license exams down the road.

Q: I have a question regarding licensing that no one seems to be able to answer. Sometime back the CSLB discontinued and then consolidated some “limited specialty licenses”.  Particularly “D-15” (Furnaces) was consolidated to either General “A” engineering or “C-20” (HVAC).  While logically I can see the “C-20” consolidation I cannot understand where the General “A” comes in.  Any idea?

A:  Over the years, the CSLB has eliminated or consolidated a number of “C-61” Limited Specialty categories.  For instance the “D-47” (Tennis court surfacing) category is now logically handled by the “C-12” (Earthwork and Paving) and, or the “A”.  Likewise, floating residential docks, the“D-58”and Propane Gas Plants, the“D-57” were also placed under the “A”.

I spoke to a former CSLB manager who was instrumental in making some of these “C-61” changes over 20 years ago.  The reason why, in his recollection, is the Board consolidated the “D-15” under the “C-20” AND “A” because it was being used for licensing larger industrial furnaces or kilns, in addition to smaller consumer residential equipment.

Your question prompted me to do some investigating and look at the history of the “C-61” (Limited Specialty) classification.  According to a 1951 License Law and Reference Book, it was the established policy of the CSLB to place all classifications not otherwise listed into the “Classified Specialists Classification” (as it was then known).  The Board was concerned that the construction industry had “untold specialized crafts requiring certain skills” and to establish all of these separately would have hampered and confused “the enforcement of restricting operations to a certain classification”.

For years, there apparently was only a loose accounting of these “classified specialists” and very little formal written documentation.  Basically there was a file with notes on the “C-61” categories that had been issued.  The Registrar in the 1980’s wanted to bring some rhyme and reason to the process as well as eliminate or “subsume” a number of the “D” listings that could be handled by more established classifications.  This ‘history’ ultimately resulted in what you see today.

There still is a “C-61”/”D-64” (Non-specialized) classification, which acts as a catchall for very limited crafts and new products that simply cannot fit anywhere else.  These are assigned on a case-by-case basis.

Q: I work for a Municipal Utility District that trains and utilizes its own employees for traffic control measures. Do you know if we’re exempt from the “C-31” licensing/certification?

A: Yes, as Shauna discovered, detailed in B&P Code Section 7040, public agencies are exempt from contractor’s licensing requirements including the “C-31” (Construction zone traffic control) classification if they are using their own employees within the scope of entity’s official capacity.

Q:  First thank you so much for all the past advice you’ve given me.  My question relates to workman comp insurance.  I read that I can no longer hire an independent employee and must provide workman’s comp, even though he has his own insurance. Is this true?

A:  Hiring independent employees commonly referred to as “independent contractors” has always generated questions.  Either a person is your employee or a “contractor” (independent or otherwise).  Employees are covered by Worker’s Compensation and have payroll taxes deducted each paycheck; whereas, licensed contractors are responsible for their own taxes, etc.  So, yes you should be providing these “independent contractors” with Worker’s Comp coverage unless they have a valid CA contractor’s license (in which case they’re a sub-contractor).

It would be very unusual for an unlicensed contractor to have a Worker’s Compensation insurance policy.

Q:  Our Company is a Limited Liability Company (LLC) based outside California.  Several years ago we obtained a California license and formed a corporation because the CSLB wasn’t issuing licenses to LLC’s.  We are now in the process of applying for a license in the LLC’s name and we’re moving our Qualifying Employee from the corporate license to the LLC license.  The problem is we still have multiple projects going on under the Corporation’s license number.  We’d like to cancel the corporation’s license once the LLC license is issued, but what happens to those ongoing projects?

A: To avoid getting ‘drowned’ from changing licensing while in the middle of a ‘stream’ of projects let us suggest a better way. Once the corporation license is cancelled it cannot sign any new contracts or continue work on existing projects.  So rather than cancel the corporate license let it run its course.  The CSLB gives you a 90-day grace period from the date you move your Qualifying Employee.  During those 90 days the license remains in good standing as if the Qualifier was still there. During the 90-day grace period it would be best to work with the parties involved and assign all existing contracts to the LLC.

Q: I have a company with the ‘A’ license in California.  I now want to start a separate parking lot maintenance and striping business.  I’m trying to figure out the best way to move forward.  I have striped many parking lots that we have built using my “A” license.  If we intend to concentrate on striping with this new company, would I need to get a “C-32” license or would an “A” be sufficient?  If I have to get a “C-32” I hope my experience striping lots in the past will suffice (there have been many).  I would probably want to incorporate this new company.

A:  While the “A” (General Engineering) classification would likely suffice, I would recommend applying for the “C-32” (Parking and Highway Improvement).  “A” contractors can properly handle a wide variety of projects that are also performed under a specialty “C” license.  For example, General Engineering contractors can handle virtually all aspects of the “C-12” (Earthwork and Paving), “C-34” (Pipeline), “C-42” (Sanitation Systems), “C-46” (Solar) and “C-32” classifications.  However, what I’ve found over the years is that some owners (both public and private) specify or, at a minimum, prefer the contractor to have the specialty class.  Since you have done many parking improvement projects, call us to discuss how you may qualify for a waiver of the “C-32” trade exam.

Q:  I have some work opportunities coming up, but need a California contractor’s license.  Is it legal to work under my father’s contractor’s license using my own business name?  Since he is the sole owner of his business, would he need to get Worker’s Comp Insurance if I use his license? And would I need to buy my own liability insurance or would the work fall under his? Any direction and advice in this regard would be greatly appreciated.  Thank you.

A:  Sorry, but you cannot use your father’s license number.  State law prohibits an individual to loan or give their license to another person.   There are generally three options if you want to pursue these “work opportunities”:  a) you and your father can apply for a partnership license; b) your father can hire you as an employee (but he would need to sign any contracts and obtain Worker’s Compensation coverage) or c) your father can form a corporation and you could be appointed as an Officer.

Q:  My wife and I and our son have a class “A” license as partners.  My son is the Qualifier on this license and we’re thinking of getting a new license with my wife as the Sole Owner and my son as the Qualifier.  We also plan on keeping our current license.   Can we do this?

A: No, this can’t be done as you described.  If your wife will be the sole owner, this would make your son a Responsible Managing Employee.  As a RME, the CSLB would not allow your existing license active to remain active.  The license could be cancelled or inactivated.

Q:  I am the RME on my employer’s contractor’s license.  I was just appointed Vice President and would like to know what I need to do regarding the Contractors Board.  I see online they have an Application to Report Officers.  Is this what I need to file?  What happens with the existing bond?

A:  While it would seem to be logical to make this change by completing an Application to Report Current Officers, this is not the form you need to file.  You must complete an Application to Replace the Qualifying Individual thereby replacing yourself on this license. Your existing Bond of Qualifying Individual (BQI) can stay the same; however, if you own 10% or more of the company, the BQI can be cancelled.

Q:  You helped me get my CA license and you are currently assisting me with obtaining my Nevada license.  I was curious if Nevada has a system such as the CSLB’s where you can check the status of your pending application online?

A:  Unfortunately no.  If you do not have a current Nevada license, you will not be able to check status online.  However, once your license is issued you can register this number with the NV Contractors Board. In turn, this will allow you to renew your license, update your address, and check the status of many future applications online.