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Bad Contractors Licensing Information

Beware of bad contractors licensing information!

Isn’t everything on the internet true??   But seriously, you have to beware of bad contractors licensing information on the www.

I came across this webpage: https://generalcontractorlicenseguide.com/california-contractors-license/ and as I read through it, I kept finding bad, incorrect, erroneous information.  I started to make a list but when I got to about half of the article I gave up.  Just too many mistakes/errors, etc.

Bad Contractors Licensing InformationHere is some of the misinformation I found:

1) (CLSB) should be CSLB
2) “Applicants may be exempted from the exam if they have been actively working in the construction trades continuously for at least the past five years.” This is basically incorrect, but appears it might be referring to a specific exemption with specific conditions. Doing more research or talking to a licensing professional will let you know if you qualify for any type of waiver.
3) Experience must be “…certified by an individual who can speak to the quality of the applicant’s work.” Incorrect. The law only states that the certifier must have first hand knowledge of the experience being provided.  The certifier has nothing to do with the quality of the applicants work.
4) “The applicant’s experience must also be able to be verified via an official document, such as payroll slips, contracts, or something similar.” This is only true if the application is randomly pulled for a secondary review.
5) “Fee payments may be made by mailing a check or money order. In-person payments may also be made at the licensing headquarters by cash (exact amount only), check, money order, and credit card.”  The CSLB will not accept a credit card for application fees. The CSLB will accept credit/debit payments for license renewals, but not license apps.  And this can only take place at specific CSLB offices.

So, when researching information on how to obtain your contractors license, no matter what state you’re in, be careful of sites that were only created to make someone money by ad clicks placed throughout the page.  Their goal is not to provide you with accurate information, in fact, that goal may not even be on their list.  They just want you to click on ads and make them $$.

Contractors Business Name Style

Contractors Business Name Style

Contractors Business Name StyleMany people get caught in the contractors business name style law, or B&P Code 7059.1, and end up with a rejected contractor’s license application.

The contractors business name style code section states: “7059.1. Misleading or incompatible use of name styles (a) A licensee shall not use any business name that indicates the licensee is qualified to perform work in classifications other than those issued for that license, or any business name that is incompatible with the type of business entity licensed.
(b) A licensee shall not conduct business under more than one name for each license. Nothing in this section shall prevent a licensee from obtaining a business name change as otherwise provided by this chapter.”

The Contractors State License Board’s (CSLB) interpretation of this law is that your business name must be compatible with the classification you are applying for. If you are applying for a B-General Building license, your business name must have the words construction, building, or contractor in it (unless you are using your personal name as the business name). So… if your corporate name, partnership name, or sole owner DBA is “My Business Rocks, Inc.” or “My Business Rocks & Sons” or “My Business Rocks”, the CSLB will require you to add a DBA that matches the classification you are applying for.

My Business Rocks Construction (B-Gen)
My Business Rocks Electrician (C-10)
My Business Rocks Plumbing (C-36)
My Business Rocks Drywall (C-9)

To give you my straight up opinion… this law is government overreach at it’s finest. If I want to name my business “My Business Rocks” I should be able to do that… without having to add a DBA (a DBA that then must be included on all contracts, advertising, etc.).

A client sent me the correction letter he received from the CSLB where the tech told him “Business name must be strictly compatible with the classification in which you are applying for, not allude to any other classification and not be too vague.” Too Vague!!?? Does someone at the CSLB have the title of “Too Vague Police”? Who determines what is too vague and what is not?!? For people like me who help applicants wade through the red tape, it makes it very difficult when CSLB techs jump ship and begin changing the laws as they wish.

You’ll notice in the law section mentioned above there is nothing that states that the business name “must be strictly compatible with the classification” being applied for. It states, “or any business name that is incompatible with the type of business entity licensed” (emphasis added) My Business Rocks, Inc. does not indicate that I’m performing work in a classification that I’m not applying for.  It also doesn’t suggest that my intent is to operate as a sole owner with a corporate name.

Wouldn’t it be nice if government agencies actually followed the law as written? And wouldn’t it be nice if the CSLB techs didn’t alter or amend the contractors business name style law, or any other law, whenever they feel like it?

General Building Experience

General Building Experience

General Building ExperienceAre you having trouble with your general building experience outline (or any trade outline)? Has the Contractors State License Board (CSLB) rejected your B general building application because your outline was not formatted properly?

An improperly formatted general building experience outline is a very common issue, and probably the number one reason why applications get rejected. The application requirements state that you must show experience in framing and at least two unrelated trades, i.e. HVAC, Electrical, Plumbing, Concrete, Painting, Drywall, etc. when applying for the B-General Building license.

What the CSLB does not want to see are administrative duties such as, pulling permits, signing contracts, hiring subs, reading blue prints, etc. They also don’t want to see specific projects. The experience outline should be a broad overview of what you do (either install or supervise) on the job site on a daily basis.

I was contacted by an applicant whose application was rejected because their experience was not properly formatted. I reviewed the outline, and although it did contain the necessary framing and two unrelated trades, the outline began with a detailed description of solar installations. While solar can be one of the two unrelated trades, beginning the outline with that suggests to the tech reviewing the app that that is the main focus of the experience. It also suggests that the CSLB tech is incapable of thinking out of the box. Either way, a properly formatted experience outline would include framing in the beginning.

I help a lot of people every week with their general building experience outlines. If you are having trouble with yours, or the CSLB has rejected your app, I do offer an application review service that will save you time, frustration, and cut through some red tape. Click here if you would like to have me review your application and/or experience outline, then email your application, work experience page, and/or the CSLB rejection letter to me and I’ll look it over.

Merry Christmas

Merry Christmas to all of my clients, readers, family, and friends!

Merry Christmas

Workers Compensation Laws Changed

Contractors License Workers Compensation Laws ChangedWorkers Compensation laws changed earlier this year, thanks to AB 2883.

And here’s how it’s affecting California contractors and applicants.

This new law, as stated in-part below, requires that corporations carry workers comp if they have officers that own less than 15% ownership in the company.

How does this affect contractors and license applicants?

If you’re a current corporate contractors license holder and you have officers who are listed on the contractors license but not on the corporate record with the Secretary of State (SOS), you should be carrying workers comp for those officers who are not listed on the SOS record.  Or you would need to add those officers to the SOS record*.

If you’re applying for a corporate contractors license for the first time (or changing from a sole owner to a corporation) and are using someone other than yourself as your RMO qualifier, that person must also be listed on your corporate record with the SOS.

Sound simple enough?  Maybe not.  What if the positions of President, Secretary, Treasurer, and Director (PSTD) have all been filled by other personnel besides the RMO qualifier?  Then what?  The SOS only wants to see the names of those individuals, PSTD.  You can always add another Director to the list.  But what if you don’t want your RMO to be on the Board of Directors?  Then what?  Exactly! Then what?!?!  Phone a friend?  Buy a vowel?  Take your ball and go home?

I reached out to the Contractors State License Board to get their input.  Their reply was “The Contractor’s State License Law provides that a licensee must file a certificate of workers’ compensation if they employ anyone who would be subject to the workers’ compensation laws of a California, or they may file a Certificate of Exemption from those laws if they don’t.”  But I know they are not requiring applicants to prove that officers listed on the application have at least 15% ownership.  So the CSLB doesn’t care about workers compensation laws??  It’s very black and white with them… if the license has an RME.. it needs works comp.  That’s it.  Nothing about the other officers listed on the application and how much of the company they own.

Here’s a scenario…

A corporate license application has an RMO qualifier who states he owns 30% of the company and his title is VP.  Additional officers include the President, a Secretary, and a Treasurer.   When the CSLB processes the app, they’re only looking to see if the named President on the app matches the named President on the SOS record.  So, let’s say they match.  The CSLB is then not asking for proof of ownership levels of the other two officers!  Now let’s say that those other two officers, who may or may not be listed on the corporation with the SOS, each own only 10% of the company.  What then?  Well, according to AB 2883, they are in violation of the law for not carrying workers comp!

To go a step further…

Let’s say this corporation attempts to buy a workers compensation policy.  The Pres/CEO will have to sign a waiver form for his officers stating that they each own at least 15% of the company… including the RMO.  But wait, he already owns 30%!  Yes, but if you look at the CSLB website, it only states that the RMO owns “at least 10%”!  State Fund, the workers comp underwriter, doesn’t know that the RMO owns 30% because the CSLB says he only owns at least 10%.  Government working together at its best!

*What if those other officers (Sect./Tres) only own 5% each, and the Pres/CEO and/or Board of Directors is not willing to increase their ownership to 15% EACH?!  Then State Fund will rate their salaries based on the type of construction services the license provides…. increasing your workers comp rates exponentially!

Bottom line…. your workers comp rates will not be through the roof… they’ll be through the stratosphere!

This is nothing but a money-making scheme produced by over paid legislators.  It’s just one more thing to drive businesses out of California!!

AB 2883 States, in part:
Existing law defines an employee, for purposes of the laws governing workers’ compensation, to include, among other persons, officers and members of boards of directors of quasi-public or private corporations while rendering actual service for the corporations for pay. Existing law excludes from that definition, among other persons, officers and directors of a private corporation who are the sole shareholders of the corporation and working members of a partnership or limited liability company, as specified, unless they elect to come under the compensation provisions of the laws governing workers’ compensation.
This bill would revise those exceptions from the definition of an employee to apply to an officer or member of the board of directors, as specified, if he or she owns at least 15% of the issued and outstanding stock of the corporation, or an individual who is a general partner of a partnership or a managing member of a limited liability company, and that person elects to be excluded by executing a written waiver of his or her rights under the laws governing workers’ compensation, stating under penalty of perjury that he or she is a qualifying officer or director, or a qualifying general partner or managing member, as applicable. The bill would specify the effective date of the waivers.

 

 

 

 

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Updated California Law Business Contractors License Exam Kit_1Updated California Law Business Contractors License Exam Kit

CSLB Reassigning Application Technicians

CSLB Reassigning TechniciansI was told recently that the Contractors State License Board (CSLB), Licensing Department, has reassigned several of their license application technicians to their call center.

This is good news, bad news.

Good news because their call center has lacked competent people for a very long time.  You could call three times and get three different answers to the same question.  These long-time employees, many with over ten years at the CSLB, will bring valuable knowledge to the center and the consumers that call them.

The bad news is that they’ll be hiring new people for the licensing department to backfill the positions vacated by the move.  Why is that bad news?  Because these new techs won’t know anything about the licensing process.  It will take months for them to be trained to a point where they’re comfortable in what they’re doing and to have a good understanding of the processes and intricacies involved in contractor applications.

Not only that, but the comfortable short-term backlogs we’ve been experiencing will be no more.  It’s possible that the backlogs could increase to months instead of weeks, as it is now.

After 17 years of working for and dealing with the CSLB, they still manage to baffle me with their ill-conceived ideas and hair-brained schemes.  It’s almost as if they are not capable of looking one or two steps ahead.

It’s unlikely they will un-do this bad idea, so for all of us who process apps and the people who are applying for a license will be paying the price for the foreseeable future.

CSLB Raising Fees

 

CSLB Raising FeesThe CSLB will be raising fees on July 1, 2017.  Get ready to dig a little deeper into your wallet.

It’s been a long time since the Contractors State License Board has raised their fees, but here they come.

Click here to view the fee increase chart in a PDF.

Application and Licensing Fees June 30, 2017
or before
July 01, 2017
or after
Original Application (exam or waiver for one classification) $300 $330
Initial License Fee $180 $200
Additional Classification (for existing license) $75 $150
Additional Classification (each) (with waiver or joint venture application for original license) $75 $75
Re-Examination $60 $60
Add New Personnel (for existing corporation or LLC) $0 $100
Replacing the Qualifier $75 $150
License Reactivation Application $360 $400
Joint Venture Application total fee for one classification
(Application fee plus initial license fee)
$480 $530
Home Improvement Salesperson Registration Application $75 $83
Asbestos Certification Application $75 $83
Hazardous Substance Removal Certification Application $75 $83
Fingerprinting Fees—Paid to Live Scan Operator
Dept. of Justice Processing Fee
Federal Bureau of Investigation Processing Fee
$32
$17
$32
$17
Live Scan “Rolling Fees”
Each Live Scan site sets its own fee—CSLB does not set the price. Rolling fees are available on DOJ listing of Live Scan sites
Varies Varies

 

Please Note:

The required fee amount to renew your license is based upon the license expiration date.

If your license expires after June 30, 2017, you must pay the increased renewal fee amount, even if you make your payment before June 30, 2017.

The correct amount due appears on the renewal notice you received from CSLB.

 

License and Registration Renewal Fees Licenses that expire
June 30, 2017
or before
Licenses that expire
July 01, 2017
or after
Active Timely Renewal
(Postmarked or received at CSLB [for hand deliveries] on or before the expiration date)
$360 $400
Active Delinquent Renewal
(Postmarked or received at CSLB [for hand deliveries] after the expiration date)
(Renewal fee plus penalty)
$540 $600
Inactive Timely Renewal
(Postmarked or received at CSLB [for hand deliveries] on or before the expiration date)
$180 $200
Inactive Delinquent Renewal
(Postmarked or received at CSLB [for hand deliveries] after the expiration date)
(Renewal fee plus penalty)
$270 $300
Home Improvement Salesperson Timely Renewal $75 $83
Home Improvement Salesperson Delinquent Renewal
(Renewal fee plus penalty)
$100 $124.50

 

Miscellaneous Fees June 30, 2017
or before
July 01, 2017
or after
Duplicate/Replacement Pocket/Wall Certificates $11 each $12 each
Certified License History for licensed or unlicensed contractor, per name researched $67 $67
Certified License History for registered or unregistered Home Improvement Salesperson, per name researched $67 $67
General Status Letter $8 $8
Bond Status Letter $8 $8
Copies of Public Documents $0.10 per page $0.10 per page
Certified Copies of Public Documents $2 plus $0.10 per page $2 plus $0.10 per page

Rogue CSLB Application Technicians

Beware of rogue CSLB application technicians!

First.. Happy Memorial Day weekend.  Remember it’s not about BBQ’s, it’s about remembering those who sacrificed their lives to protect our freedom.

Some application technicians at the CSLB have been falsely rejecting applications for corrections to their experience outlines.

The problem is… there is nothing wrong with the experience outlines they’re reviewing. The bigger problem is that many, if not most, CSLB techs have zero construction experience.  I was contacted by someone this week whose application was rejected for experience.  I reviewed his outline and it met the CSLB requirements for the classification he was applying for. I gave him some advice on how he could spruce it up a bit so that maybe the tech would realize that he actually is qualified.  After having talked to the applicant, I could tell that was definitely qualified.

But what are we to do?  If properly formatted applications and experience outlines are being submitted only to be rejected by someone who has absolutely no experience in construction… how can we play the game?  I’m a pretty black and white kind of guy. I’m a Navy vet who grew up knowing what the rules are. Rules that we all had to follow. But when we’re dealing with people who seem to make up the rules as they go…. there’s no way we can play the game!

The CSLB often forgets that their salaries are paid by application, license, renewal fees, etc., and without those applicants, licensees, they wouldn’t have a job.  And they often forget that they’re dealing with people’s livelihoods.  Taking care of contractors is certainly not in their mission statement. Their purpose is to protect consumers, but come’on… they could at least hire people who know the difference between a sill plate and a hot mop.

I know I’m asking a lot.  The State hiring of Program Technicians will never include requiring them to have construction experience… as I did.  So I guess we’ll just have to take the bad with the worthless and deal with each knucklehead that crosses our path.

Have a great weekend!!