Alien Licensing, Clearing License Judgments, “C-29” & “C-36” Limits

We will ‘color outside the lines’ in this Capitol Connection, crossing the borderlines for the state and nation. A contractor will learn he has crossed another ‘line’ in pursuing work with his present license class, but first we share an unfortunate reality with a contractor who wants to ‘line up’ a new license despite problems with his present one…

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.

 

HIC Contracts, Inactive Licenses & SOS Suspensions

Winning or losing in a court case often depends on getting the best information before going to trial. While most of our questions come from contractors, we also often work with attorneys; researching license law, CSLB practices or providing expert testimony. We start with a lawyer’s question and swear to tell the truth, the whole truth, nothing but the truth…

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.

“C-61” Limited Specialty & Public Agency License Exemptions

How a business or government agency got to where they are today is often called ‘institutional memory’ based on the recall of those who were there when these decisions were made. A recent call from a contractor regarding ‘specialty license classes’ sent me to ‘history’ class in finding an answer. Knowing how and where to look for those answers is what makes Capitol Services the expert in contractor’s licensing…

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.

Independent Contractors, Worker’s Comp, “C-32” & LLC Licensing

When is a worker an employee? For contractors the question is critical to doing business legally in California. Another corporate contractor is hoping to ‘change horses’ now that LLC licenses are a reality. For those with the “A” we take a look “C” at what specialties you might also perform…

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.