Contractor Rules for California B License & RMO

Longevity in business is often one of the ways to tell who is providing quality work over time. That’s why for contractors having a ‘low’ license number can be important. Another question brings to light the fact some generals may be unintentionally breaking the law. Lastly, have we discovered a ‘loophole’ that may ‘rain’ on the parade of some “C-39″s . . .

Q: I’ve done quite a bit of research and have been unable to answer what seems like a straightforward question. If the personal license of a Responsible Managing Officer (RMO) is suspended (for bond suspension) is the corporation’s license affected. In other words, does the corporation’s license depend upon the status of the individual RMO’s license?

A: A bond suspension — or even expiration — of the qualifier’s personal (sole owner) license has no impact on the status of the corporation’s license for which he serves as RMO.

Q: I just received a letter from the CSLB telling me they could not reassign my partnership license to our new corporation. In fact they issued us a new license number that begins with a “92”. What happens to our old partnership license? Can I still use the old number (which begins with a “63”)?

A: Unfortunately, the CSLB cannot reissue a partnership license to any other entity. When conducting business as a corporation, you should use this new license number. If the partnership is still intact you can continue to use this old number but ONLY for the partnership – not the new corporation. If the partnership was dissolved or one of the partners has left or disassociated, this license will be cancelled.

Q: A friend of mine just faxed me one of your recent columns in a magazine (sorry I am not sure which one). It involved a “B” contractor bidding on a project with just one trade. I also have a general building license and often take projects involving one trade. Is this really a problem?

A: Yes it is a potential problem. As I have indicated in prior columns, a “B” may take a prime or subcontract involving TWO or more unrelated trades (framing or carpentry are exceptions). In most cases, it’s proper for the “B” to take a project that involves only one trade if it’s subcontracted to a properly licensed contractor.

Q: Thank you for the informative information that you contribute to my plan room publications. In regards to your recent question involving a general contractor not being allowed to perform roofing; wasn’t there a change in California a year or two ago that said that the general must have Workmen’s Comp on file and in force when performing roofing. I believe that may have been the intent of the question.

A: Thank you for the kind words. I am glad you find my columns so informative. I truly enjoy writing these every week and am happy to respond to those who take the time to call, write or email questions.

I believe you’re referring to Section 7125, which addresses Worker’s Compensation and the “C-39” classification. Only contractors holding the “C-39” classification are affected by this 2006 law. It states that any active license that includes a roofing classification must have a Certificate of Worker’s comp on file with the CSLB (even if they have no employees). Granted, it is nearly impossible to tear-off or install a roof without employees, but there is no specific requirement related to a General (“B”) contractor having this insurance coverage. This is one of those apparent ‘loopholes’ you hear about in laws.