Solar Electric

Contractors are finding one ‘bright’ spot in the growing demand for ‘green’ energy. Another electrical contractor feels they are getting ‘burned’ by misinterpretation of the license rules. I will ‘bond’ with another contractor before helping a crane operator understand when a license is required to work in California…

Q: Can a contractor perform solar work under an “A” license?

A: Yes! In fact the CSLB just issued an advisory that provides guidelines about the contractor license categories that are allowed to perform work on solar energy. As it relates to the General Engineering, ““A” contractors are authorized to perform active solar energy projects.”

Q: I intend on bidding a project for a public agency that involves installing, servicing and maintaining low voltage energy systems. I hold a “C-10” (Electrical) but am being told I need a “C-7” (Low Voltage) classification. This is confusing since I thought the “C-10” could perform “C-7” work? The agency is pointing to the words “service and maintains” in the “C-7”, which is not in the “C-10” definition. I would appreciate your expert opinion.

A: It appears the public agency is misreading one or both classifications. You are correct, the “C-10” can perform all work included in the “C-7” classification – including maintaining and servicing electrical systems. The key word is “electrical”. While the words “maintain and service” do not appear, it is implied. Since a “C-10” can place, install, erect or connect any electrical wires, fixtures, apparatus, etc. they can also service and maintain said connection or placement.

A further reading of the “C-10” includes the words: “ which generate, transmit, transform or utilize electrical energy IN ANY FORM OR FOR ANY PURPOSE (emphasis added)”. The public agency should ask themselves this question: If a “C-10” cannot repair faulty electrical wiring, then which license class would one use? This being said, as I have written in past columns, the public awarding authority has the final say in which classification they will allow to bid.

Q: I have a company applying for membership in our association. They are a crane service but have indicated that since their cranes and operators are certified a license is unnecessary. Is there any license required for this type of company?

A: I am unsure how or why the certification of cranes or their operators would overrule the need for a contractor’s license. In most instances, the “C61”/”D-21” (Machinery and Pumps) class would be required since this includes the installation, removal, modification or repair of cranes. I hope this helps.

Q: One of your prior columns in our membership publication was of particular interest. It involved a contractor that had a suspended sole owner license since his bond had lapsed. You stated that this would in no way impact his status as the RMO on his employer’s corporate license. I have a similar situation except one of my former employees has come back to work for me and holds a “C-54” (Tile) license. I would like to add him as a Responsible Managing Employee (RME) to my existing “B” but want to know if it makes any difference if his license is expired. Thank you for writing this column. I always look forward to reading it.

A: I am glad you enjoy reading my column and are able to use this information to help your business. As with the suspended license, there is no restriction on adding him as RME with an expired license. From your fax, it appears his license only recently expired due to the economy so you should have no problem adding this class to your existing General “B” license.

RMO/RMe & DVBE

The Chinese character for crisis is the same as that for opportunity. With the recession requiring contractors to find new ways and new avenues to profit, the idea of qualifying a new license is one frequent topic of conversation. I am also discovering that some contractors are looking farther away to find work now…

Q: We are regrouping to start a new company in California. What options exist if we want to use a qualifier on the license for this new venture?

A: While you didn’t specify, when starting a new business you have the option of getting the license as a partnership, corporation or sole owner. If applying as a partnership, the qualifier can be a partner or RME (Responsible Managing Employee). If going for a corporate license, this individual could be a RME or RMO (Responsible Managing Officer). If he is a RMO or qualifying partner owning 20% or more of your business entity he can “still run his own business” and keep his license active. A RME would be required to inactivate his license, as would someone who owns less than 20% of your company.

Q: I have a “B” license and want to find out how to qualify for some of the Disabled Veteran Business Enterprise (DVBE) ‘goals’ offered in state and federal contracts. I served in the military and have since become disabled. I understand that I may qualify for some jobs where contractors are seeking to hire companies owned by veterans?

A. Your injury occurred after leaving the military and unfortunately this would make you ineligible. The Department of Veterans Affairs certifies service-disabled veterans when they leave the military while the California Department of General Services is the State’s certifying agency that administers the DVBE program. Anyone interested in learning more about DVBE certification could contact either of these Departments or consider visiting the statewide DVBE Alliance online at www.cadvbe.org. This non-profit organization can provide valuable information you need to know regarding DVBE opportunities. The site also features more than a thousand companies owned by California disabled-vets ready to work with contractors.

Q: I know that Utah has a reciprocating agreement with California wherein one can get a license by endorsement. Does Arizona offer a similar arrangement?

A: California, Nevada, Utah and Arizona all have ‘reciprocity’ agreements with each other. These agreements however, do NOT allow one to get a license in another state “by endorsement”. The reciprocity you’re referring to only applies to the trade exam and generally only if the qualifier has been licensed in good standing for 5 of the prior 7 years. In Arizona, licensing must have been for the prior five years, while in Utah licensure in one of these States need only be for one-day. Note, not all trade classifications are subject to reciprocity. Additional tax and corporate registration is required. The applicant will also need to pass the Business Management and trade exams and document 4 years of experience in the specialty trade.

General California Contractors License & Public Works Projects

While contractors have worked wonders in building the Golden State, even they can’t be in five places at once! Another contractor hopes to shed some ‘light’ on how General Engineering contractors can soak up some ‘green’ profits. And finally, another lesson in Public Works Bidding 101…

Q: Can an “A” (Gen Engineering) license install wind generators and solar panels?

A: According to B&P Code 7056 an “A” contractor is able to construct …powerhouses, power plants and other utility plants and installations…” This would include wind generators and solar panels. Further, according to CSLB Rule 832.62, the phrase “in connection with fixed works requiring specialized engineering and skill” in Section 7056 “shall include active solar energy systems”.

Q: What is the requirement for a Responsible Managing Employee (RME)? My question regards a contractor with a “B” license with offices throughout the state. What role does the RME have to play in a major project for a major utility? Does he have to oversee all projects? Thank you very much for your input.

A: As I have written before in my column, a RME must work a minimum of 32 hours a week — or 80% of the time a company is operational — whichever is less. While he or she should be a “bona fide employee” and involved in the day-to-day operations of the company, the CSLB does not expect a qualifying individual to be in five places at once.

Using your example, lets say the company is working on multiple projects out of offices statewide. Let us further state that one project is very large compared to the remaining work. If the RME ends up spending 95% of the time on the large project and 5% of his time on the remaining jobs, has he done anything wrong? The answer is NO as long as the RME meets the statutory requirements set down by the Contractors Board.

Q: Why do some local government agencies require an “A” license when the work is only “C-8” concrete? In particular, some cities in Sonoma County are only allowing General Engineering (“A”) contractors to bid on their “Annual Concrete Maintenance” (i.e. new curbs, sidewalk repairs, gutters, etc.) Doesn’t this seem counter to their supposed goal of increasing competition and potentially saving taxpayer $$$? What options do I have?

A: It was nice speaking with you. I wish I could explain why some local government agencies exclude well-qualified contractors on some projects. This is an ongoing problem that I hear about every month from at least one caller. It’s not just a problem in your county; it’s a problem statewide. With millions of dollars flowing to CA as part of the Federal Economic Stimulus package, there are projects up and down the State that have been or are about to be funded. Excluding qualified contractors makes no financial sense!

The goal of these construction funds is to create jobs and get money flowing back into the economy. If a city can save thousands of dollars by having more bidders, this theoretically frees up funds for another project somewhere else. In addition, on a practical level, there is no reason a “C-8” contractor should be denied the opportunity to bid on what is obviously CONCRETE work. As we discussed, since the scope of this work does not include any piping, sewer, paving, etc. – ONLY concrete — in my expert opinion you should be allowed to bid. Common sense would seem to demand it.

However, this being said, B&P Code Section 7059 states, “In public works contracts the awarding authority shall determine the license classification necessary to bid and perform the project”. I doubt you’ll be able to change this contract; however, you may want to appeal to the City Council asking them to modify and correct this situation in future work.

A & B License & Self Employment

California’s complex laws and some common misconceptions can frustrate both contractors and those who may desire a license. A simple name change, or even a lack of a clear understanding of the rules, can ‘mow down’ your business plan before it gets started. That’s where I come in, to help clear the air and provide that necessary understanding…

Q: My husband has been self-employed since 1997 providing lawn and garden maintenance services for both residential and commercial clients. He does some minor sprinkler system repairs, but never any design or installs. We carry liability insurance and a local county business license. It’s not clear to me if we need to have a landscape contractor’s license. Can you please clarify this? Also, what is a “specialty” license and what are the requirements to qualify for the exam waiver?

A: Providing lawn and garden maintenance (mowing, weeding, fertilizing, etc.) does not require a contractor’s license. However, if your husband is handling landscaping work – including irrigation systems – on jobs billing over $500.00, then he should file an application with the Contractors Board. The need for a contractor license might be triggered by ‘minor sprinkler system repairs’ (as you stated) or in planting trees and shrubs or replanting an entire lawn with new sod.

A “specialty” license is a category of licensure established by the CSLB. This includes 41 “C” trades, such as, landscaping (“C-27”), plumbing (“C-36”), electrical (C-10”), roofing (“C-39”), etc. These differentiate from the General Building “B”, and Engineering “A” classifications. For all trades the applicant must be able to show 4 or more years experience within the past 10 years and pass the trade and law exams. One exception is the “C-61” (limited specialty) that has a number of “D” categories but no trade test.

Q: Thank you for your help and advice. I just received my sole proprietor license today. Now my wife will be starting a new corporation using the same name except with “Inc.” at the end. I’ll be the qualifier (RMO) and will hold the title of Secretary and Treasurer. She will own 51% and serve as company President. I want to keep my sole proprietor license and not give it to the corporation. Will this be a problem? Does she have to be tested? What forms do you need to get this accomplished? How long will it take at this time to get the corporation a license so we can start bidding work? In the meantime, does the law prohibit us from bidding work without this?

A: To operate as a corporation –even if simply adding the word “inc.” to your business name- requires a new license. In recent weeks I have received two calls from people that mistakenly thought they could simply file a name change form with the Contractors Board and this would resolve the issue.

There is no requirement that your sole proprietor license be transferred to this entity. In fact, you would need to own 51% to do so. Your wife does not need to be tested since you are the Responsible Managing Officer, or RMO qualifier; however, your wife must be fingerprinted.

It will likely take 6 weeks to get the new corporate license in place. The CSLB processing times have been getting longer due to the Governor’s mandated “Friday Furloughs.” Technically, you should not be bidding until you have the new corporation license number.

Hazardous Certification In California

These contractor inquiries about rules and regulations regarding electrical and hazardous removal have been assembled from past columns, and answer some of the questions contractors are asking now. Plugging into hi tech power demand and removing what was once ‘state of the art’ in building tech require special certification before going to work…

Q: As a General Contractor in California can my employees, remove as much as 1000 Square Feet of floor tile that contains asbestos? Will a new license classification be needed? What do you recommend to prepare for he exam?

A: A contractor must be certified and pass the appropriate asbestos exam with the CSLB and be registered with Cal/OSHA for any work that involves 100 square ft or more of surface area that contains asbestos materials. If the removal of asbestos involves less than 100 sq. ft. of surface area the CSLB does not require certification as an asbestos abatement contractor. However, you should still file a CARCINOGEN ‘REPORT OF USE’ FORM with the Occupational Carcinogen Control Unit at DOSH.

If you intend on applying for the Asbestos Certification or any trade, the Contractors State License Board (CSLB) publishes a separate “Study Guide” for each license class. These two or four page information sheets include a summary of each test; a few sample questions; and a lengthy list of publications recommended by the State. While the State readily recommends dozens of publications (from a number of large publishing companies) they rarely recommend the more direct approach. Simply contact someone who is in the trade to find out what they found most effective in preparing for the license exam.

Q: I need to obtain a “C-46” Solar License. From reading your column, I know the CSLB does not issue licenses to an LLC. However, since I am the only member, would it be best to apply for the license as an individual and not through the LLC? If so, how would I complete the first section when it asks for the company information? Is it possible to apply only as an individual?

A: Yes, you are correct in the assumption. Applying as a sole proprietor would appear to be your best course of action. However, the State of California will not license LLC’s under current law. When you refer to completing the “first section”, I assume you mean the business name on the application. This can simply be your name or a fictitious business name (but not the LLC entity).

Q: I currently hold a “C-7” and “C-10” license in Calif. We install residential wiring, Fire alarm and voice/data communications cabling. Will Nevada consider me for a waiver of any exam?

A: The Nevada Contractors License Board will require a trade exam for all the work you describe. The “C-2” Electrical classification (and the 7 subclasses such as “C-2C” “fire detection”) does not fall under California’s reciprocity agreement with Nevada.

Q: I hold a “C-10”(electrical) and “C-20”(HVAC) license. Sometimes work will be required on a project that does not fall under either of these classifications. Can I get into trouble if I perform this work?

A: B&P Code 7059 (a) addresses your question. A specialty contractor can perform a contract involving the use of two or more crafts or trades if the work is “incidental and supplemental” to the work for which you’re licensed.