Expired License, General Building and Qualifier’s Departure

Anyone can read the law. Knowing how it’s being applied, what interpretation is being followed and any exceptions is what makes you an expert, and our first contractor needs one. Another finds that his situation is not as bad as he might have first thought as we clarify contractor law to help remedy his problem…

Q: I currently have a “C-36” (Plumbing) and “C-20” (HVAC) license.  For the past 7-8 years I have also been doing smaller remodels/renovations and energy upgrades to residential homes and commercial buildings.  I recently applied to add the General Building (“B”) classification to my license in order to be covered for this type of work.  The CSLB rejected my application and requested that I provide proof in the form of permits or contracts that I have done Structural Framing and two additional unrelated trades on my General Building projects.

 

I don’t do new construction so structural framing is not required.  However I handle nearly every other aspect of the “B” classification such as finish carpentry, electrical, plumbing, drywall, painting, HVAC, etc.  The CSLB technician I spoke with said my application would not be accepted unless I can prove that I’ve done “Structural Framing.”  Is there somewhere in the ‘contractor law’ where it states that you specifically need Structural Framing experience in order to become a General Contractor?

 

A: The short answer to your question is NO!  There is no California Contractor License Law that specifies the need for Structural Framing experience in order to qualify for a General Building license.  The “requirement” for framing experience is strictly a CSLB internal policy.  Framing is certainly one of the trades covered under the General Building category, in the same way that building bridges is a component of the General Engineering classification.  However, the CSLB does not require that all “A” contractors provide proof that they’ve built a bridge.

 

This is an issue that contractors have struggled with for years and my suggestion would be, as the technician also suggested, provide further proof in the form of contracts or permits that document the many General Building trades you have handled and hope the CSLB reconsiders its ‘interpretation’ of the law in your case.

 

Q: Our Qualifying individual left the company and our license is set to expire at the end of the month. I called the CSLB and they informed me that they would not renew the license without the Qualifier’s signature on the renewal form.  Since he is no longer with the company he is refusing to sign.  Coincidently we also have a Joint Venture license with the same Qualifier that is due to expire at the end of next month.  We have work in progress and cannot afford to have these licenses lapse!  Will the CSLB grant us an extension?

A:  The CSLB will not grant an extension for an expired license. However, if you disassociate your Qualifying individual from the license you will have a 90-day window in which to replace him.  If you send in the renewal applications signed by an Officer listed on the license within that 90-day window, the CSLB will renew the licenses without the Qualifying individual’s signature.  This applies to the company license as well as the Joint Venture (JV) license.

811 Calling, Waterproofing, RMO Stock and “A” Concrete Work

Is there a license for that? You may be surprised at what work actually requires a CA contractor’s license. Always better to check first rather than get surprised without it. You can always call us at any time to discuss your issue, we may later share it to help others learn from your lesson, but don’t hesitate to ‘drop the dime’ to Capitol Services. First, a quick answer for a guy in a real hurry…

 

Q: I never imagined I’d do more than follow your column when I could, but I do have an issue.  I am trying to sell my business and plan to remain as the Responsible Managing Officer (RMO).  The buyer is under the impression that I must own 20% of the stock to make the RMO position legitimate.  I am maintaining that a separate bond would suffice without stock ownership.  I would be grateful if you would respond to this issue since escrow is to close in two days and this just became an issue today.

 

A:  You are correct! There is no requirement that you own any percentage of the corporation.  If the new owner posts a $12,500 Bond of Qualified Individual, you would not need to own any stock.  The bond is required for all RMO’s that own less than 10%.   Good luck with the sale.

 

Q:  Can a contractor with a Class “A” license pour concrete for residential and commercial projects?

 

A: It all depends on the total scope of the project.  For example, a General Engineering contractor cannot just pour concrete for the foundation of a home. However, they can if in addition to that they are also doing the curbs, gutters, sidewalks, etc.  Basically, an “A” contractor can do cement and concrete work if it’s in connection with a General Engineering project.

 

Q: Is there a contractor’s license for waterproofing?  And will I be required to take an exam for it?

 

A: Yes, there is a license for that.  The specific type of license can be a little tricky as that work can fall under several different classifications depending on exactly what you’re doing.  It can be covered under a “C-39” (Roofing), “C-33” (Painting), “C-29” (Masonry), or “C-54” (Tile).  Each of these classifications has a trade exam.  There is also the “D-65” which is “weatherization and energy conservation” that includes weather stripping, caulking, water heater pipe wrap, etc.  The “D-65” does not have a trade exam.

Contact our office and we can nail down the proper classification for you.

Contractor Alert: March 2013 – The CSLB reminds contractors that they must call 811 before beginning a project that will disturb the ground surface – whether by digging, drilling, boring, etc.  You must contact either the Northern or Southern California regional notification center at least two working days (but not more than 14 calendar days) before beginning your excavation project.  According to the bulletin, “the regional notification center call is free by dialing 811.  If you fail to register, your excavation will be considered unauthorized digging and you may be subject to a fine of up to $50,000, held responsible for any repair costs, and potentially lose your contractor license.”

ILOC & LLC, AZ Solar and Experience Credit

Paperless office? Not on Earth! Keeping documentation to prove a point is often required. As our first aspiring contractor will learn having a ‘paper trail’ is an issue that may make or break his dream of getting licensed. We help clear the air obscuring an opportunity for solar work across the border before sharing a tip on reducing costs in becoming an LLC in California…

 Q:  I called the Contractors Board and was told that I might not be able to get a license since I was paid “under the table”.  Is this true?  I have the required four years experience.

 

A: The person at CSLB likely told you that a random percentage of applications are sent out for investigation.   All applications are evaluated to determine if the applicant has the required years of experience.  However, in determining if an application is sent out for a more formal investigation, the Board may look at a number of factors including your age; how many years experience you have; and whether your background is self-employed or as owner-builder.  Also, a small percentage of applicants are selected totally at random.

 

If for any reason your application is flagged, you’ll likely be asked to provide proof of your contracting background beyond the required Certification of Work Experience.  This ‘trail’ of proof can be through pay-stubs, tax returns, or other means showing how much you were paid and for how long.  If you were paid “under the table” it may be difficult to produce documentation showing that in fact you performed the work you claim.

 

Q:  My Company does solar electrical work.  We are based in California and we have a “B” General Building license here.   We are interested in doing the same type of work in Arizona but are unsure what the proper classification would be.  Is it the same as California? Can we do solar work with a General Building license?

 

A:  There are several classifications in Arizona that allow you to do solar work, unfortunately I have to tell you the General Building license is not one of them.  For solar electrical you would be required to obtain an “L-11” Commercial Electrical, a “C-11” Residential Electrical, or a “K-11” Dual Electrical classification. Fortunately, we have assisted contractors with Arizona licensing for many year and if you’d like our assistance with this process give us a call.

 

Q: I am in the process of obtaining a Contractors License for my Limited Liability Company (LLC).  As you probably know, an additional bond is needed for a CA LLC in the amount of $100,000.  My bonding company is asking that we get an Irrevocable Letter of Credit in order to obtain this bond.  Is this standard?

 

A: According to the bonding company resource we consulted, the Irrevocable Letter of Credit (ILOC) is an option for an LLC that may not want to be submitted for credit consideration.  It is also a way to reduce the fee for the bond.  From what we’ve heard from many of our LLC applicants, the LLC/Worker bond has a minimum premium of $5000, so if you are able to secure an ILOC then that fee is greatly reduced.  You can apply for an ILOC with your bank, but please note that the bank must first be approved through the bonding company. Tax or other legal issues aren’t addressed here so a call to your tax advisor is always a good thought in making important business decisions.