‘Borrowing’ a Contractor’s License, Qualifiers & NV License

Despite what a contractor may believe is the right direction, misinformation about their contractor’s license can often lead to a ‘dead end’. Like the ‘GPS’ of contractor’s licensing law we can help you get to your destination. Another contractor needs expert ‘directions’ to Nevada…

 

 

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.

HIS, License Experience & NV Contractor’s License

You have to walk before you can run, as some younger aspiring contractors must learn. Apprentice is only the first step towards a license.  Winning contracts in the market is always hard work, but on those bids involving government or special districts there are additional challenges. For our first contractor there is little room to maneuver between a ‘rock and a hard place’…

 

Q:  I contacted your office today to discuss whether or not the Home Improvement Salesperson (HIS) certification is applicable for our service and repair technicians.  On the bottom of the HIS application, it states “a bona fide service repairperson who is in the employ of a licensed contractor and whose repair or services call is limited to the service or repair initially requested by the buyer is NOT required to be registered.” 

My concern is what happens if our technicians go to a customer’s house and sell something beyond the initial requested service call.  We certainly are not going to pass up an opportunity if there is a legitimate need.  Is this something you recommend we pursue?  Is it a big deal and cost?  Your thoughts?

 

A: This situation puts you in the ‘middle’.  On the one hand only doing the repair means no salesperson registration is required; however, since sales are part of your goal, I believe this would trigger the need for HIS registration.  Look no further than the CSLB quote: “…whose repair or services call is limited to the service or repair initially requested by the buyer”.   I would recommend having all your service/sales folks register.  The HIS application is only 1 page, no testing is needed and the fee is just $75.00.  Live Scan fingerprinting will be necessary at an additional cost of approximately $70.00.  I hope this helps. Contact Capitol Services with any further questions.

 

 

Q:  If you were an apprentice for a licensed contractor for a number of years can you file to get a contractor’s license?

 

A:  The CSLB requires that all applicants for a license show at least 4 years ‘JOURNEYMAN level” or Supervisory experience within the past 10 years.  In some cases apprenticeship training can be used in lieu of some practical experience but you would need an official apprenticeship certificate.

 

 

Q: I have an “A” contractor’s license; however the second lowest bidder does not.  This is a Federal project and they’re contending that a license is not needed.  Since some of the project is on county property wouldn’t the license be required?

 

A:  I would contend that a license is necessary since a portion of the work is on county land.  If the ENTIRE project were on federal property a contractor’s license would not be required.  This being said, in either case it will be up to the awarding authority whether they want to see a license number on the contract.  Being they are not the low bidder, this may be a moot point.

 

 

Q:  I have a CA contractor’s license and have been asked to do a small job in NV.  Do I need a license there or can I simply use my existing CA number?  What are the costs?

 

A:  Unfortunately, you may not use your CA license.   A NV contractor’s license is required for projects over $1000 (including material and labor).   As we discussed, since this is the only job you anticipate doing in this state, it may not be worth your while.  Total fees for the license application, corporate registration, bond, fingerprinting and testing will likely exceed $2,000.  Please note this minor work exemption does not apply to plumbing or electrical jobs or any project that requires you to pull a permit.

 

‘Unwritten Rules’, Replacing a RME, “C-7” & Business Names

While the complex regulations governing contractors in California are largely written in law, some of the ‘rules’ guiding licensing remain ‘unwritten’. These are not actual statutes, but practices derived from CSLB interpreting the ‘black and white’ legislation. We ‘dial in’ a low voltage answer, and also as strange as it may sound, a Qualifier learns he has been promoted to replace himself…

Q:  You are currently helping me obtain my “C-6” (Cabinet, Millwork and Finish Carpentry) license in CA.  You stated that we could not use the ‘doing-businss-as’, or dba name “XYZ Construction” without adding a descriptive word before “Construction,” such as “Carpentry” or “Cabinet”.  Can you point me to the law that supports that restriction? Because I just located a name almost exactly like ours on the CSLB web and they also have a “C-6”.

A:  The Contractors Board has had a policy for the past dozen years, which states that only “A” or “B” and more recently “C-5” Framing contractors can use the word “construction” unless preceded by a descriptive name related to your specialty.  Since this is an administrative “policy” and not a statute/law I would not know where to direct you to see this in writing.

The contractor’s license you located on the CSLB web site was issued in 1995.  Typically when the Board makes these types of administrative changes, they ‘grandfather in’ businesses that were licensed prior to the policy being implemented.

 

Q: I am trying to find out if a license is required in CA to install coaxial, HDMI, Cat-5, and other low voltage communications equipment. If so, what license is it and where can I find details on the requirements for this license.  Also, how long until it needs to be renewed?

 

A: The work you describe requires a “C-7” contractors license in CA.  Below is the official description from the CSLB. On average, it should take about two months to secure this license.  It will need to be renewed every two years to remain active.

 

California’s code of regulations says, “A (“C-7”) communication and low voltage contractor installs, services and maintains all types of communication and low voltage systems which are energy limited and do not exceed 91 volts. These systems include, but are not limited to telephone systems, sound systems, cable television systems, closed-circuit video systems, satellite dish antennas, instrumentation and temperature controls, and low voltage landscape lighting. Low voltage fire alarm systems are specifically not included in this section.”

 

Q:  I am presently the RME (Responsible Managing Employee) on our company license. I was just appointed as the VP for Operations. Do I need to notify the Contractors Board?  Should we complete the Application to Report Current Officers?

A: Congratulations on your recent promotion.   I’m asked this questions on a regular basis; mainly from folks who have had their Application to Report Current Officers rejected.  Even though a ‘change of officers’ has occurred, you need to notify the CSLB by filing an ‘Application to Replace the Qualifying Individual’.  In effect, this means you’ll be replacing yourself, and thereby become the ‘new’ Qualifier as Responsible Managing Officer (RMO).

AZ Licensing, Worker’s Compensation Exemptions & “C-61”

Our first contractor inquiry introduces a new character in the ongoing Capitol Connection story.   One of the most important people working behind the scenes at Capitol Services is stepping up front. Many contractors who have worked with our Sacramento office have gotten answers directly from Shauna Krause, my expert assistant.  Now, readers of the Connection will also benefit from her knowledge, experience and outgoing personality as she tackles some of the future “Q&A” featured here…

 

 

Q:  You helped my company get their AZ license last year and I have a question.  I am the Qualifying Employee on the current Arizona license (I don’t own any stock).  There is another company who would like to hire me to be their Qualifying Employee so that they can obtain an Arizona “KB-1” (Dual General Building) license.  I also don’t have any stock ownership in this company.  Can I be a Qualifying Party for both companies?

 

A:  Glad to hear from you again.  The Arizona Registrar of Contractors (ROC) will not allow you to become the Qualifying Party on this second license.  This would only be allowed if one of the following were true:  a) you, as the Qualifier, owned at least 25% of each entity; or b) one licensee is a subsidiary of the other licensee.

 

Q:  I’m a licensed contractor who you might say ‘plays by the rules’.  There is another contractor in my area that does not.  I know for a fact that he has several employees but does not carry workers compensation insurance.  Any suggestion on who to contact about this information?  I would like someone to investigate this guy.

 

A:  As you know, any contractor that hires employees must cover them by carrying Worker’s Compensation insurance.  If a licensed contractor has no employees, an Exemption from Worker’s Compensation can be filed with the CSLB.  The problem, as you indicated, is some contractors have employees yet file the Exemption anyway.  A related problem is employers who “under-report” the number of employees they have.

 

I suggest that you file a complaint with the CSLB and the Department of Industrial Relations (DIR).  As I have indicated in prior columns, both agencies have taken a real interest in ‘leveling the playing field’.   A new law that will require contractors to reaffirm this exemption every time they renew their license may help in the long run.

 

 

 

Q: Is there a required exam for the “C-61”/”D-21”?

 

A:  Yes, the CSLB requires that you pass a law exam; however, there are no trade tests for any of the “C-61” categories.  Once you become licensed as a “C-61/ D-21”(Machinery & Pumps) contractor, you should review the entire list of “C-61” categories to see which others you may qualify for.  These additional trades would be issued without any further testing.

 

According to a recent CSLB press release, “the first state contractor license was issued to a limited liability company (LLC) on January 19, 2012.”  The recipient, a client of Capitol Services, was from the state of Washington.  As of late last week, the “CSLB has received 36 LLC applications,” said Registrar Steve Sands. “However, our Licensing division has had to reject many because they were submitted without the correct information.”

A common reason for rejection is the missing LLC registration number or that the personnel listed on the application do not match those reported by SOS. As this is a completely new application process, anyone needing assistance can contact the Connection.