“B” for Solar Bids & B&P Section 7031 and Consumer Payments

Government regulation is often complex and can be easy to misinterpret. Sometimes the ‘scope of work’ extends beyond the written rules, as our “B” readers have learned. As might be expected, the actual practice of ‘interpreting’ the written rules often lead to some interesting and unique ‘exceptions’ in their actual application…

Q: I am thoroughly confused about Solar contracting and what classification is necessary for what we are doing.  We have a “B” (General Building) license and I understand that we need to be doing at least two unrelated trades on our jobs.

I’ve heard that “B” contractors can do Solar, but then I’m thinking that doesn’t meet the two unrelated trades rule.  I have also seen many “C-10” (Electrical) contractors performing this work.  Are “C-10” contractors also authorized to perform all types of Solar contracting, even if, for example, it’s a ‘solar farm’ that includes some structures?   Can you please clarify this for me?

A:  Solar energy systems constitutes the use of two unrelated building trades in and of itself, which is why the CSLB has determined that a General Building (“B”) contractor can perform Solar work.  Keep in mind that Section 7057 states that a “B” contractor’s principal contracting business should be in connection with a structure being built.  Therefore, the law implies that a “B” contractor can do solar, but only in connection with a structure.

“C-10” Electrical contractors are authorized to perform any Solar projects which generate, transmit, transform or utilize electrical energy in any form for any purpose.

For more information on Solar guidelines you can call our office or visit the CSLB’s website at http://www.cslb.ca.gov/generalinformation/newsroom/industrybulletins/industrybulletins2010/industrybulletin20100630.asp

In a recent column, I responded to a question that a “consumer is not required to pay a contractor who is not properly licensed during the entire length of the project.”  A sharp reader (who is also an attorney) correctly pointed out that this is not always the case.  He noted that this is an issue he has dealt with in court and does not believe this is an accurate statement of the law in California.  He said he “knows that the devastating consequences of non-compliance are not automatically applied if there are appropriate circumstances to mitigate such a result”.

Code Section 7031 deals with this issue and Subsection (e) states “the court may determine that there has been substantial compliance” potentially negating the Draconian impacts of the remaining portions of the law.

I must also point out that the questioner noted that she “checked out his license and found that it’s currently suspended.” The exception is that since some “suspensions” can be erased by the contractor filing a backdated Bond or Worker’s Compensation certificate, consumers may not want to withhold payment – unless they are sure this license ‘Suspension’ is part of the official record.  And even then, as noted by our reader attorney, there may be extenuating circumstances. Before taking any action of this nature it’s always a good idea to get a legal opinion.

Again, if a consumer or contractor has a question regarding payments related to B&P Section 7031, it is best to consult with a construction attorney who can provide you with legal advice. As we are limited by space requirements some answers on contractor licensing have unique exceptions not related to the primary question. Readers are always welcome to share their knowledge here in clarifying an answer.

 

CARB Rules on Diesel, Bond Claims & Correct Business Name

The first step in reaching a goal is knowing where to start! For contractors filing an application, adding to an existing license or for a multitude of other needs Capitol Services is a good choice for a starting place. As we have maintained for years, knowledge is power and knowing where to go for it is half the battle! Don’t miss the Contractor’s Alert that wraps us up…

Q:  Our Company recently filed a name change request with the CSLB in order to change our “dba” name to Wilson Construction. The CSLB rejected the form stating that we “must specify trade along with ‘Construction’ or obtain a class “B” license.”  I have tried to call the CSLB because we are not sure what that means, but I can’t seem to get anyone on the phone.  Can you shed any light on this?

A:  After looking up your license I see that you have an “A” General Engineering license.  In order to use “Construction” in your business name you must either have a “B” General Building classification, OR you can add wording that specifically describes the classification that you hold; for example, “Wilson Engineering Construction”.

 

Q: Can you tell me what statute deals with kickbacks/referral fees?  I am interested to find out if it’s okay for a contractor to start offering a homeowner a referral fee for referring him out to neighbors/friends?

 

A:  B&P Code 7157 discusses inducements and it states, “no person may promise or offer to pay, credit, or allow to any owner, compensation or reward for the procurement or placing of home improvement business with others”.  A contractor may give tangible items to prospective customers for advertising or sales promotion purposes, but the gift cannot exceed a value of $5 and only one such gift can be given in connection with any one transaction.

Q:  I need to file a claim on someone’s bond.  Where do I start?

A:  You would want to start with contacting the individual’s bonding company. The bonding company will provide you with a questionnaire and then you will be required to respond within 30 days.  Be sure to include any documentation that you have to support your claim. Contractor’s bonding information is available on the CSLB website or call us for assistance.

 

Contractor’s Alert: Special Attention “C-57” Licensees:

The CSLB recently released a bulletin to remind Well-drilling contractors who work in the Central Valley that they must register portable internal combustion engines of 50 horsepower or greater used to power drilling equipment with either the state or San Joaquin Valley Air Pollution Control District.

The Board says, “Well drilling contractors can choose a registration method depending on their work location.  Those who drill within District boundaries must register their fuel-powered engines of a certain horsepower under Rule 2280 (Portable Equipment Registration).  C-57 contractors whose work takes them beyond the Central valley are required to register their portable engines of a certain power with the California Air Resources Board (CARB)”.

 

Asbestos Certification, Public Works & Obtaining License History

Despite attempts to make government more accessible, understandable and open to citizens there always seems to be one more ‘hoop’ to jump through to get where you want to go as our first question shows. We also offer a new take on the old Latin phrase, “caveat emptor” or buyer beware…

Q:  First of all, I want to say thank you for your recent efforts/help with our various licenses!  I’d like some clarification on our asbestos certification though.  On our license it shows the asbestos certification and says “for bidding purposes only”.  That implies that we cannot actually perform the service.  We are registered with DOSH as an asbestos contractor.  Do we need to provide the CSLB with our DOSH certificate?

A:  Yes, if you are performing asbestos abatement work then you should provide the CSLB with your DOSH certificate.  Once that is provided, the CSLB will remove the “for bidding purposes only” notation from your license.

 

Q:  Is there anything a contractor can do to influence how a public agency classifies work for a project?  The General Contractor on our current project said the project is 90% General and 10% Electrical, but the City wants to give the contract to a “C-10” Electrical contractor.

 

A:  Unfortunately there is not much a contractor can do regarding a public agency class determination on one of their projects.  Unless it’s wildly ‘off base’ a local government agency can pretty much decide which classification they will accept. Both public agency and federal projects have their own unique processes and requirements that don’t always align with those in the private commercial marketplace.

 

You can always appeal to the governing board of the public agency, however that usually doesn’t go anywhere because it creates the need to re-advertise the bid but it’s one thing you can try.

 

Q:  I am not a contractor but I came across your website when I was doing research on what I should do about an issue that I’m having with a contractor that is doing work on my home.  I am not happy with his work at all and I checked out his license and found that it’s currently suspended!  I called the CSLB to see what the date of Suspension was and they said that they were not able to give me that information.  Is there a way that you can find out when the license went ‘suspended’?  And is it true that I don’t have to pay him for the project because his license is suspended?

A:  In order to find out when the license was suspended you will want to request a “certified license history” from the CSLB.  We can request this for you and pick it up when it’s ready, or you can fill out the form, which is available on the CSLB’s website, and mail it in.

Yes, it is true that you as a consumer are not required to pay a contractor who is not properly licensed during the entire length of the project.  If the individual’s license goes ‘Suspended’ even for just one day as the result of non-compliance (such as an expired Worker’s Comp policy or an expired License bond) they are not entitled to be paid for the entire project by law. A crucial point for contractors to know and understand because many consumers now do know they can easily research the law and licensing online. “Contra cave” in Latin or in any language, contractors beware!

Adding to JV Licensing, Reciprocity & Inactivation vs Disassociation

You may not use it now, plan to keep it in its current form; add to or subtract from it, but your contractor’s license is golden, and the result of hard work and study. These contractors illustrate how changes in life and business can affect your licensing…

Q: I recently started working for a new company and they would like me to add my license HVAC (“C-20”) to their existing General Building (“B”) license.  How will this affect my own personal license?  Will I be required to disassociate from my license?  I am the only Officer of my corporation.

A:  If you have no ownership in the new company that you work for then you will be required to inactivate your own Corporate license.  Since you are the only Officer listed on the license if you disassociated from the license there would be no one left with signing authority.  Which means if you wanted to reactivate it at some point in the future you would need to “jump through a few hoops” first.  My recommendation would be to inactivate the license instead of disassociating.

Q:  I was previously a contractor in the State of California but about a year and a half ago I moved out of state.  I noticed that my contractor’s license is currently expired, which is no big deal because I don’t plan to use it anytime soon.  However, I do have family in California and there’s a possibility that I may move back at some point.  Will I be able to just renew my license at that time?  I don’t really want to pay fees for something that I’m not using…

A:  Once your license is expired you have 5 years to renew before you need to apply for a new license and re-take the exams.  As long as you are within a 5-year window, you can renew without needing to take the exams again.

Q:  I’ve had an Arizona electrical license for 20 years.  When I applied for a Nevada license I was required to still take the trade exam because they didn’t recognize the electrical trade as a reciprocal classification.  Is California the same way?  I’d like to get my license there but would love to avoid taking the exams.

A:  Nevada has determined that the electrical trade is not reciprocal, however it is reciprocal between California and Arizona.  So as long as you’ve been licensed for 5 out of the last 7 years in Arizona, you will be able to waive the trade exam in California.  The Law exam is still required.

Q:  We currently have a Joint Venture license with a General Engineering (“A”) classification.  One of our new employees recently added the “B” license to our company’s corporate license, which is one of the entities that makes up the Joint Venture (JV).  Can we add that classification to our JV license or are we required to apply for a brand new license?

A:  You can add the General Building or “B” classification to the Joint Venture license.  There are certain requirements that must be met for the application paperwork so please contact Capitol Services for assistance with the process.

 

 

License Number Advertising

While ignorance of the laws is no excuse, as we are often taught as children, the multi-layered complexity of contractor’s regulation in California is not an easy lesson. With full-time work as licensed contractors it helps ease the load just knowing you have an expert ‘on call’ when the inevitable question comes up about breaking those rules. As readers know, sometimes those ‘rule’ breakers are looking for a competitive edge, legal or not…

Q:  Could you tell me what are the requirements for a contractor using his correct name in advertising?   My local newspaper has an entire page of contractors (and other professionals) listing their services.  I went through the “home repair” listings (because this is my specialty) and all four had an incorrect name.  Isn’t there a requirement that a contractor use the name on his license?  Why doesn’t the newspaper disallow these ads?

A:  The CSLB has a number of requirements for contractors who advertise – including use of their correct name style.  As we have discussed in our past columns, and as the Contractors Board has included in their periodic newsletter, you cannot advertise using a company name different than what is on your official CSLB license.

Since you provided me with the name of your local newspaper, I decided to do a non-scientific “investigation”.  Of the 30+ ads from licensed contractors published on this particular Sunday, I selected about a dozen at random.  80% had an incorrect name style.  Not only that but one of the advertisers had their license revoked in 2013; two had suspended licenses; and one contractor’s license expired a few months ago.  In addition, one of your competitors was running more than one ad, each with a different business name; yet he was using the same license number (which is not legal).

Advertising is a good way for contractors to get heir name known locally; however, as you’re likely aware, it is not lawful to contract unless the license is in good standing.  While many newspapers require a contractor to list their license number, I doubt they check on the business name and they rarely do any follow-up once the ad begins running.

Since a contractor can be issued a citation or face disciplinary action for using an incorrect business name, this might be a good time for all licensed contractors to review their advertising program.  It is also a good time to check the CSLB web site to make sure YOUR license is current and in good standing.  For instance, do your Bond and Worker’s Comp show they’re renewed (with no pending suspension)?  Is your license due to be renewed, but you’ve not received the application form from the Board?  Are your current Officers listed on the Board’s records?   As always, if there are any problems related to your license, please contact Capitol Services to see if we can help in resolving licensing issues.

Q:  It is my understanding that advertising must have your number included.  Does that apply to shirts with your company name and logo on them?

A:  This seems to be somewhat of a “grey area”.  CSLB regulations require that any time a licensed contractor advertises their services, whether on paper, over the airwaves or on the Internet, a license number must appear.  This includes but is not limited to; letterhead, business cards, any type of direct listing, airwave transmissions, newspaper ads, vehicle lettering, or any form of advertising.

Clothing and caps are not mentioned, BUT according to the Statewide Investigative Fraud Team (SWIFT) at the CSLB, clothing and any give-away items are considered advertising, therefore if you want to be safe, include the license number!!