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 FeesJune 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
VariesVaries

 

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 FeesLicenses 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 FeesJune 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!!

Phil the Dog

I just have to share this….

I received an email from a client who just passed his exams.. part of his email included this…

“I want to thank you so much for all your awesome help, if I had known about you before I wasted not only TIME but MONEY as well……I will make sure my write up about you and your services are large enough EVERYONE ELSE can see…
Thanks Again

PS my kids named their new dog after YOU……PHIL”

That is soooo awesome!!! lol

CSLB Fees will Increase

Effective July 1, 2017, CSLB fees will increase.

CSLB 2017 Fee Increase

 

 

It’s gonna get a little bit more expensive to obtain, maintain, and change/update a contractors license!

 

Application and Licensing FeesCurrentFee as of July 1, 2017
Fee
1.      Original Application$300$330
(for those taking exam or requesting waiver for one classification)
2.      Additional Classification (each) (with waiver or joint venture application for original license)$75$75 (unchanged)
3.      Initial License (good for two years)$180$200
4.      Re-Examination$60$60 (unchanged)
5.      Additional Classification Application (for an existing license)$75$150
6.      Replacing the Qualifying Individual Application (for an existing license)$75$150
7.      License Reactivation Application$360$400
(for licenses expired for more than five years)
8.      Joint Venture Application$480$530
(total fee for one classification – application fee plus initial license fee)
(see #2 above for additional classification fee)
9.      Add New Personnel Application$100
(for existing corporate or limited liability company licenses – not including the qualifying individual; see above for replacing the qualifier)
10.   Add New Limited Partner Application$100
(for existing partnership license)
11.   Home Improvement Salesperson Registration Application$75$83
12.   Fingerprinting Fees – Paid to Live Scan Operator$49$49 (unchanged)
Dept. of Justice (DOJ) Processing Fee($32 DOJ &
Federal Bureau of Investigation (FBI) Processing Fee$17 FBI)
13.   Live Scan “Rolling Fees”VariesVaries
(each Live Scan site sets its own fee)
14.   Asbestos Certification Application$75$83
15.   Hazardous Substance Removal Certification Application$75$83
License and Registration Renewal FeesFor Licenses/For Licenses/
Registrations that expire on or before June 30, 2017Registrations that expire on or after 1 Jul 17
$360$400
16.   Active Timely Renewal (postmarked or hand delivered to CSLB on or before the expiration date)
17.   Active Delinquent Renewal$540$600
(postmarked or hand delivered to CSLB after the expiration date)
(renewal fee + penalty)
18.   Inactive Timely Renewal$180$200
(postmarked or hand delivered to CSLB on or before the expiration date)
19.   Inactive Delinquent Renewal$270$300
(postmarked or hand delivered to CSLB  after the expiration date)
(renewal fee + penalty)
20.   Home Improvement Salesperson Timely Renewal$75$83
(postmarked or hand delivered to CSLB on or before the expiration date)
21.   Home Improvement Salesperson Delinquent Renewal$100$124.50
(postmarked or hand delivered to CSLB after the expiration date)
(renewal fee + penalty)

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CSLB Chooses Against C1 Classification

I just received word that the CSLB will not be pursing the addition of the C-1 Classification.

I posted in October of 2015 that the CSLB would be creating this classification to allow the license holder to perform work that “provided that no load bearing portion of the existing structure is altered, added or moved; this includes footings, foundations, and weight bearing members.” Basically, it would have allowed the C1 contractor to bid, contract, and perform work that includes at least two unrelated trades that did not include framing.

My assumption was that this new classification was in response to their now defunked “critical classification” application process.  A process that was actually an underground regulation that was devastating the industry.  Now that they’ve finally come around to processing apps in a manner that is actually allowed by law, it would appear they’ve decided against the new classification.

I’m sure they have their “reasons”, but that new classification would have meant that many unlicensed people could have obtained a license. And, therefore, putting some sort of dent in the unlicensed industry that the CSLB has been so inept in containing or curbing.  They just can’t seem to get out of their own way.

I give this decision a BIG….

CSLB C1 Thumbs Down