Foreign Company Licensing, Qualifier Disassociation and Qualifier Rules

When you are bi-national and cross country you also may need expert assistance! Another out-of-state question from a contractor gets a ‘qualified’ answer ahead of one for a “C-17”. The last one is ‘mistaken’ in more ways than one…

Q:  We are a Canadian firm, but our US based company is in Florida.  We have a Contractor’s license in Florida.  We just landed a job in CA but we are not licensed there so we need to obtain a license immediately.  I am not at all familiar with the licensing rules and procedures in CA.  Does a CA Contractor’s license expire?  If so, what is the duration?

A:  Thank you for contacting us.  California licenses need to be renewed every two years to remain valid.

Q:  We are a Michigan contractor and we have a potential job in California, so we need to obtain a General Building (“B”) contractor’s license.  From the research I’ve done, in order to speed up the process, we should identify an individual who already holds a “B” license.  Our concern is if our Qualifier leaves the company, are we no longer licensed?

A:  Once your Qualifier leaves the company, the CSLB allows you 90 days (from the Notice of Disassociation) to replace your Qualifying person.  Once your application is in process, you can request a one-time 90-day extension.  You should have this request (if needed) submitted several weeks before your deadline in order to get approved for the extension.

Q:  We are needing to apply for a “C-17” (Glazing) contractor’s license. With regards to a Qualifying Individual, is there a difference between using a trade employee vs. a corporate Officer?  Does the individual need to have the specific specialty experience we are applying for, or is someone with general construction and/or engineering experience acceptable?

A:  Regardless of whether you use an RME (Responsible Managing Employee), or an RMO (Responsible Managing Officer), your Qualifying person will need to have the required experience in the specific tradeyou are applying for.  Officers and employees do have different responsibilities, please contact my office to discuss the differences.

Q:  We need to change our Qualified Individual and we have an employee currently holding an Inactive license who is willing to Qualify our license.  We submitted the Application for Original Contractor’s License “Waiver”.  I’m trying to follow up and get some status but all I can see is there has been a rejection of some sort.  I’ve been unable to get a hold of a live person at the CSLB.  Can you help?

A:  Hmmm…sounds like you mistakenly submitted the incorrect application, which is likely reason for the rejection.  Because you already have a license and are looking to update your Qualifier, you should have actually submitted the Application for Replacing the Qualifying Individual.  This will require that you withdraw your current “Waiver” application, and you will be issued a new application number for the Replacement application.

NASCLA License, Family Transfer and Test Reschedule Fees

One size does not fit all when it comes to contractor licenses! A ‘grand-daddy’ of questions has a family flair, and a final question that is ‘pass’ or ‘fail’…

Q:  I have taken the NASCLA (National Association of State Licensing Agencies) General Building exam.  Will that qualify me for a license in CA, NV, and AZ?  

A:  To qualify for a license in CA, NV, and AZ, you are required to document at least four years of experience in the trade.  The fact that you passed the NASCLA exam will allow you to waive the trade exam in Nevada, however you will still be required to take the Construction Management Survey exam.  CA and AZ do not recognize the NASCLA exam, both law and trade exams would be required in CA and AZ.

Q: My husband has been working for his parent’s family-owned company for the past ten years. His parents want to retire, and I read somewhere that he would be able to work under a “grandfather” license. I haven’t really been able to find out too much information about the process and what he needs to qualify or how to go about doing that. Any advice would be appreciated.

A: There is no formal “grandfather” license. I think you’re referring to a law (7065.1) that allows a close relative to take over an existing license. If the family owned business is a Sole Proprietorship, this is commonly referred to as a “family waiver”. This would allow your husband to waive the exams and become the new Qualifier.   On the other hand, if the family business is a corporation, your husband can apply to replace the present Qualifier (his father or mother) with a Waiver request.

Q:  I have been in contact with the CSLB regarding the need for our company to hold the “A” General Engineering classification vs. the “C-/61”/”D-21” Machinery and Pumps license.  It seems that either one would work, but I wanted to make sure we would be able to sub-contract out the electrical/mechanical portion of our work with either license.  Do you have any advice?

A:   If you plan on subcontracting or self-performing any of the work then the “A” General Engineering classification is required.

Q:  Your company is helping us obtain our CA Contractor’s License.  If our qualifying party fails to pass the exam, how does that change the process?

A:  If your Qualifier fails the Law and Business examination and/or the Trade examination, you must pay a $60 fee each time he/she is rescheduled. The CSLB gives a period of 18 months to pass the examinations. If he/she does not pass within 18 months after the application is accepted by the Board, your application is considered void, and you will have to submit a new application with new fees

LLC, Removing Managers, Experience Waiver and Subs

I have a ‘limited’ answer for a corporate transfer question and another to ‘manage’ for different contractors. Although, there were no ‘yellow roses,’ I will also answer an out-of-state inquiry before finishing with some ‘landscaping’ work…

Q:  Our currently licensed ‘S’-corporation is applying for a license for a newly formed Limited Liability Company (LLC).  I understand it will be several weeks before the new license will be issued.  Is it possible for us to transfer the Corporation’s assets to the LLC, and do business under the LLC, with the corporate license number while we are waiting for the CLSB to issue the new license?

A: One entity cannot use another entity’s license number under any circumstances. So, no. 

Q:  We have a current Contractor’s license in CA in good standing.  Our “Managers” are no longer a part of our LLC.  Is there is any concern with removing them from the license?

A:  Possibly.  The personnel you have listed with the CSLB and the Secretary of State have signing authority for your Contractor’s License.  So, you will want to make sure when you remove personnel, you still have individuals listed on the license who can sign for any changes/updates (renewals, Officer changes, Qualifier changes, etc.).

Q:  We are a Texas-based company and we need to get a California Contractor’s license.  We are going to be applying for an “A” (General Engineering) license.  The purpose of the license is so we can contract with a sub-contractor to do the work.  Does the sub need to have the same classification as we do?

A:  Both the Contractor signing the contract, as well as the sub-contractor doing the work, bothneed to have the appropriate contractor’s license.  If your sub-contractor will only be doing specialty work, they may only need a ‘C’ classification license.  Feel free to contact me to discuss this further.

Q:  I have over 20 years of experience doing landscaping work.  Is there any way I can obtain a Sole Owner license without needing to take the exam?

A: Unfortunately, that won’t cut it.  You cannot qualify for a Waiver of the exams for a Sole Owner license based on experience alone.  If you have over 20 years of experience, you can definitely qualify for the license, however you would need to sit for the exams.

RME, Sister Companies, Adding Class and Insurance

Going, going, gone? But this contractor’s ‘number’ hasn’t expired yet. Another gets some ‘re-insurance’ before I answer a “C-20” with ‘class’. Looking to the west for opportunity a Delaware contractor has license questions…

Q:  My partner just completed the process of replacing me as the RMO (Responsible Managing Officer) on our license so that we can get our certification as a Women-owned small business.  In order to keep my qualification, can I reactivate my personal license?  

A:  I looked up your license and it’s “expired” so you cannot “reactivate” it.  After a license has been expired for over five years, it cannot be renewed.  You will be required to apply for a new license, however you can request that the CSLB re-issue your old number to you again.

Q: What are the insurance requirements for a new contractor obtaining a license in California?

A:  It depends.  If your company has California employees, you will be required to show proof of Workers Compensation insurance.  In addition, LLC’s are required to show at least $1 million in General Liability insurance.

Q:  Is there any limit to the number of classifications I can have on my license?  We are considering adding some additional classifications to our “C-20” (HVAC) license to expand our range of services.

A:  No, there is no limit to the number of classifications a license can hold.  Keep in mind for each classification, you are required to have an individual who can document at least four years of full-time work experience in the specific trade you are applying for.

Q:  We need to get a California Contractor’s license for our new Delaware corporation.  Are we permitted to use an employee of one of our sister companies as our Responsible Managing Employee (RME), or will the CSLB need to see proof, such as paycheck stubs or W-2’s, to verify the RME is employed by the applying company?

A:  While the CSLB does not always request/require W-2’s or proof of employment, per B&P Code Section 7068 your RME is required to be a “bona fide employee” of the applicant.  The California Code Section 823 definition of that description means “an employee who is permanently employed by the applicant and is actively engaged in the operation of the applicant’s contracting business for at least 32 hours or 80% of the total hours per week such business is in operation, whichever is less.”