Articles of Incorporation, RMO Liability, Installers Licensing and Bond Amounts

Happy New Year! We are all about contractor licensing this year, last year and for more than 30 years!  Capitol Services has been assisting contractors with the complex issues and aspects of applying for and keeping your license to bid and work in CA, AZ and NV. For our first question of this new calendar…

Q:  Can you tell me what the turnaround time is for filing Articles of Incorporation with the Secretary of State?  We are hoping to get a new corporation formed quickly without having to pay the $350 expedite fee.

A:  They are taking about 7 business days right now, so you should be able to make that happen.

Q:  I have a personal contractor’s license and my company would like me to be put on their license as an RMO (Responsible Managing Officer).  If the company were ever to have a complaint filed against them or be sued, could it affect my Sole Proprietorship license?

A:  The Responsible Managing Officer does hold some liability for complaints, claims, and judgments against the license.  So yes, the status of the company license has the potential to impact your Sole Owner license.  As long as you are listed as an Officer of record with the CSLB, they can go after any associated license you are listed on.  For example, if the company were to ever have an unsatisfied judgment that resulted in the CSLB suspending their license, it is highly likely the CSLB would also suspend your Sole Owner license.

As always, we recommend that you contact a construction attorney to discuss the legal liabilities associated with acting as a Responsible Managing Officer.

Q:  My company currently manufactures machines that clean, de-shells, and prepares walnuts, almonds, and other types of nuts for sale.  We are looking to start installing the machines as well and need to know what type of Contractor’s License will be required.  The machines are concrete inlaid, bolted to the ground, and we would be installing the motors and conveyors (which requires some electrical wiring), installing fans for the dryers, piping, etc.

A:  Based on what you described, the “A” General Engineering classification would be the most appropriate license. Let us know if we can assist you.

*Contractor Reminder*

 Recently passed Senate Bill 467 raised the amount of contractor’s bonds from $12,500 to $15,000.  This change became effective January 1, 2016.  We encourage all contractors to make sure that they have their new Bond or cash deposit in place to avoid the risk of having your license suspended.  Many Surety companies have a Blanket Endorsement on file with the CSLB, which means Bonds for their clients will automatically be increased to the $15,000 amount, without any action required from the Contractor.  However, if your Surety company is not one of these companies, it is important that you contact them immediately.  A list of the companies that have a Blanket Endorsement with the CSLB can be found online at

This new legislation also eliminated the requirement for applicants to prove that they have $2,500 in working capital in order to obtain/maintain a license.