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.