Contractor’s Licensing Schools

Contractors License Schools - CSLB Exam Prep Study Materials

Let’s talk about the pros and cons of contractor’s licensing schools.

I’m not referring to any one specific contractor’s licensing school, just the overall contractor’s license school method.  And before we get into the pros and cons, let’s define the word “school.”  They really aren’t schools because they aren’t teaching anything, they are showing people how to take an exam.  They aren’t an accredited learning institution, and their customers don’t go to them to learn their specific trades. So, the word school is a misnomer.

Pros and Cons

Starting with the pros list, only because it’s shorter.

They offer an in-class system where people can go spend 8 hours studying the materials that were shipped to their home or office.  That’s the one pro, if you can even call it that.  Some people think they need to sit in front of an “instructor” to absorb the information contained within the written manuals.

Now the cons.

The biggest con is that their study materials are sub-standard.  I only know this because many of their customers come to me after they’ve failed their exams using the schools study materials.

Next, their customers are just a number to them.  They don’t provide personal attention to every student.  It’s all about how many people can they get signed up.

They don’t personally and professionally prepare their customers applications.  They let the customer complete the app, which results in a large percentage of rejected applications by the cslb.

To my knowledge, they don’t employ anyone who has worked at the CSLB in any capacity.  Obviously, this is not a requirement to run a business, but if you don’t know how things work on the inside, how can you properly inform your clients?

Often, provide incorrect information and/or provide bad advice.  I hear from people all the time who were told something by a school that is incorrect.  Or they suggest a path for the applicant to take that will surely end in a rejection of their application.  And put them in a position where they can’t undo what has been done regarding their app or their experience.

Many of the schools offer guarantees, and I’m using that word lightly.  Some of their guarantees require the applicant to fail the exams several times, and each time the applicant is required to go back to the classroom or study additional practice questions.  It’s not until they’ve jumped through any number of hoops that the customer is even considered for a refund of the fees they’ve paid.  Which could be $1000 or more!

What about their instructors?

Their “instructors” are not always coming from the trades or the construction industry.  Often, they are coming from an educational background, teachers, etc.  If they have 30 people in their classroom, and of those 30, 15 trades are represented, what are the chances that the person standing in the front of the room is well versed in those 15 trade classifications? Slim to none.  You may be applying for a C-11 Elevator contractor’s license.  Do you think that guy in the front of the room knows anything about elevators except that they go up and down?  Extremely doubtful!

So, there are the pros and cons of contractor’s licensing schools.  As you can see, there are far more cons then there are pros.  When looking for CSLB exam study materials or a system that will get you ready for your exams, look for someone who has experience in construction, has worked for the CSLB, and offers the highest quality exam preparation study materials!  Look for The License Guru!!

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How long does it take to get a contractors license in California?

How long does it take to get a contractors license in California

As my father used to say… how long is a piece of string?

The processing times at the Contractors State License Board (CSLB) vary greatly.  It depends on the type of application, document, or form you’re submitting.

Different applications are processed by different units within the CSLB, and they each have their own backlogs.

When I joined the CSLB many, many years ago, the backlog was six months for an exam application to be processed.  Today it averages around three weeks, but that’s just for the application to be reviewed by a license application technician.  What are some other factors that could effect your application?

  1. Is the application formatted correctly?
  2. Are you applying for a B-Gen or A-Eng license?
  3. Is your experience that of an employee of a licensed contractor or self-employed?
  4. Are you submitting owner/builder experience?

Let’s say that your application hits all the CSLB marks for excellence and they approve your application and schedule you for the exams. Great! You’ll only have to wait about another three weeks for that test date to arrive.

While you are waiting for that test date, you’ll receive an envelope from the CSLB that contains forms you will take to a Live Scan office to get your fingerprints processed.  Check, one more thing off the list!  But wait… the FBI and DOJ that process those prints have their own backlogs and they can take anywhere between two and six weeks to return their reports to the CSLB.

Backing up a bit, what if your application doesn’t get a passing grade and the exams aren’t scheduled right away?  Well, then you’re looking at additional weeks of back and forth with the technician, waiting on a correction letter to be delivered in the mail, mailing your corrections back and then waiting on the technician to process those corrections.  If those corrections aren’t accepted, rinse and repeat.

There are tricks to speed the process up a bit, depending on your specific situation.  I’d be happy to help you find out.  Send me an email and we can discuss it. So, how long does it take to get a contractors license in California?  How much time do you have?

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CSLB Owner Builder Experience

Let’s talk about CSLB owner builder experience for a moment.

CSLB Owner Builder Experience

Since the CSLB has once again become the Soup Nazi’s (Seinfeld reference) of State licensing, many people are asking if their owner builder experience is enough to get them to the B General Building exam room.

The answer is a big fat maybe.  The problem is that owner builder experience is also heavily scrutinized. They will require permits for each project to verify the framing component.  If you did not pull permits, it is very likely they will not give you any credit for that experience.

They’ll also require that you submit a certification of work experience form (part of the license application) for each project, and an Owner-Builder B General Building Construction Project Experience form for each project.  Click here to view the form.

But wait, there’s more…

They will look at how much of the work you performed yourself and how much of the work was done by other contractors, sub-contractors, and laborers.

But that’s not all…

They’ll also determine (using some secret imaginary formula) how long it would have taken a licensed contractor to perform the same work.  Here are the unknown factors to this secret formula: 1) how long has the imaginary contractor been building houses, 2) does he use imaginary laborers to perform the work, 3) and if so, how many imaginary laborers is he using?  No one knows, which makes their formula and resulting determination sketchy at best!

Many owner builders do most of the work by themselves and bring in contractors to perform, let’s say, pouring the foundation, or installing an electrical panel, or connecting the city power to the house, but the cslb has been known to heavily discount, if not deny it all together, a persons experience because of this.  Seem fair? Of course not.  The cslb doesn’t do fair.  They do, well, basically, whatever the hell they want.

The fine print…

So how many owner builder projects must have you completed in order to qualify for the ever increasingly elusive B General Building contractors license exam??  The cslb has publicly stated that they want to see at least four (4) owner builder projects completed per year for a four (4) year period. That’s 16 owner builder houses in four years.

Is this possible?  Yes, but only for the serious house flipper.  And not for the person who buys a house, lives it in while flipping it during his spare time, then sells it and starts anew with another house.

So there you have it, the cslb owner builder experience nightmare in a nut shell.

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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.

Update: Dec. 6 2019

The CSLB told an applicant that he must use a DBA with four specific words in it. They told the applicant that he could only use those four words without changes or alterations. So here we go again… the cslb crossing the line between state agency and dictatorship.

Continuing with the original post…

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 or building 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, LLC”, 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?

Update: 5/28/19

A current client applied for a new license (waiver) with the B-General classification and his/her corp name is X Y Solar.  I informed him/her that the CSLB will ask for a DBA because the corp name didn’t include construction or building. He/she was adamant that there are other licenses out there with Solar in the name that only hold the B classification.  I agree, there probably are, but CSLB business name cops are cracking the whip, and as much as he/she doesn’t want to use a DBA (i.e. X Y Construction) the CSLB won’t move the app forward until he/she provides them with one.

Also… a DBA (or FBN) filed statement from the county where the business is located must be included with the amended application. (again… nothing in the law that says the CSLB can ask for this filed FBN statement)

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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.

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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.

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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 Scrutinizing Workers Comp Exemptions

CSLB Scrutinizing Workers Comp ExemptionsThe Contractors State License Board (CSLB) is turning their attention to contractors who they believe should be carrying workers compensation.

In the newsletter article below, the CSLB discusses their plan to look into whether or not a licensee who submitted a workers comp exempt form should actually be carrying a workers comp policy.

Right off the top, any licensee who has employees must and should have workers comp. It’s the law. It benefits the contractor and his employee’s and their families. If you know me, you know that I’m always on the side of the law. If, or course, it just and not abusive.

Regarding the CSLB plan… if it walks like a duck, talks like a duck, it’s a governmental agency abusing its power and authority…. Yet again!

What they’re saying is that if you hold the A-Gen Eng., C8 Concrete, C10 Electrical, C20 HVAC, C36 Plumbing, or the C46 Solar classification, you could be part of their “random” checks. I wonder why they didn’t include the B-Gen??

As with everything else the CSLB does randomly, what exactly is their process for choosing their random sample? Throw darts at a board, pull license numbers out of a hat?

The law states: “Pursuant to Section 7065, the registrar shall conduct a comprehensive investigation of no less than 3 percent of applications filed under this section to ensure that the applicants met the experience requirements of this section.” This is the go to section for a lot of what the CSLB licensing department does. They throw this thing out like it was a coup-fourre card in a Mille Borne game.CSLB Coup Forre

They must look at an app and decide there is something about it and…..BAM!! 7065 COUP FORRE! Unless of course your application is one of the critical classifications, then the minimum 3% rule turns into a mandatory 100% rule!

 

Anyway… back to the random workers comp sampling of the classifications listed above. I personally know plumbers, electricians, HVAC guys, and some B-Gen Bldg. guys who work alone. The fact that the cslb has selected those classifications to focus their attention shows they really have no clue what actually takes place outside of their doors.

A one man shop is going to get a call, letter, or visit from a CSLB enforcement rep and he’s going to have to stop everything he’s doing to prove that he doesn’t have employees. Just what every small business wants to deal with… the heavy hand of State Government. No thank you!

Begin article

Workers’ Comp Exemptions Will Get Extra Scrutiny From CSLB

CSLB will be taking a much closer look at licensees who file exemptions from having to purchase workers’ compensation (WC) insurance, particularly those working in trades likely to need a partner or employees.

At its December meeting, the Board agreed to a strategy to bring more contractors into compliance with California law on WC insurance. More than 50 percent of all licensees have filed WC exemptions with CSLB, a rate suspected to be too high considering the nature of the contracting work done.

Business and Professions Code section 7125 requires contractors to purchase a WC policy and submit proof to CSLB when an active license is issued, an inactive one reactivated, or at the time of renewal, unless the licensee does not employ anyone subject to California WC or files a certificate of self-insurance with CSLB. (All C-39 Roofing contractors, however, must carry WC insurance even if they work on their own.)

To identify contractors who may be improperly claiming a WC exemption, and encourage them to purchase WC policies for employees, CSLB’s Enforcement division will:

  • Perform an analysis and reach out to contractors registered with the state Department of Industrial Relations who bid on public works projects. CSLB staff will perform random checks of those contractors, and send letters to those claiming WC exemptions about the need to provide insurance if they employ workers.
  • Review a sampling of the overall consumer complaints that CSLB receives for contractor WC compliance.
  • Conduct random checks of licensees in classifications most likely to need employee labor, but who hold WC exemptions. Staff will look at those with C-46 SolarC-36 PlumbingC-20 Warm-Air Heating, Ventilation and Air-Conditioning, C-10 ElectricalC-8 Concrete, and “A” General Engineering licensees who have declared they have no employees.
  • Review permit activity in partnering counties to determine if contractors pulling permits for large projects have WC insurance.
  • Coordinate with other state agencies to further identify WC violators. Representatives from CSLB, state Department of Insurance, and Division of Labor Standards will discuss ways to raise WC compliance among contractors.

Contractors who falsely claim WC exemptions are taking a great risk to save a little money. WC violators not only face CSLB disciplinary action, but they expose themselves and their clients to liability if uninsured workers get hurt on the job.

End of article

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CSLB Changing the Rules

CSLB Changing the RulesThe CSLB is changing the rules again!

I spoke to an applicant today who’s application was voided by the CSLB.

After months of back and forth with the Contractors State License Board where they continued to ask for more and more documentation, they voided his application without offering the “options” letter. The “options” letter is something they’ve sent to countless other applicants. The letter gives the applicant the option of withdrawing the app, using someone else as a qualifier, or sending the app to a formal investigation. As you’ll see below, this applicant to not get the “options” letter. My question is why???

Did they change the rules again? And without any notification to anyone?

This particular applicant has an over abundance of experience, plus a college degree that should have given him at least up to two years of experience credit. With his experience and the overwhelming experience documentation he provided that covered more than 10 years (when only two years was required), why did they void his app?

Granted, there were some issues with the experience outline on the application (something I could have helped him avoid with my app review service), but the fact remains that he was not given the “options” letter. I firmly believe that if he’d been given the option of having a formal investigation he could have dealt with an investigator that actually has some construction experience… unlike those who work in the application unit of the CSLB who have none. The same people who were reviewing his application and made the determination to void his app.

We all know that the federal and state governments play by their own rules, but why can’t there be some consistency? How can anyone play the game when the rules are constantly changing?

Another issue I have with this particular application is that they granted an extended void date on January 8th. Did they grant a 30 days extension as is standard? No. If they had, the app would have been voided on February 8th. But they voided the app on January 26th! What the %*&# is going on here!!!

I gave the applicant some options, all of which we will pursue… bottom line… This kind of government abuse is unacceptable, and we as a society have to stand up and say ENOUGH IS ENOUGH!!

Application is void

  • 08/24/2015 – APPLICATION RECEIVED
  • 08/31/2015 – PRINTED ACKNLDGMNT LTTR TO APPLCNT
  • 09/10/2015 – APPLICATION RETURNED FOR CORRECTION
  • 09/10/2015 – WORK EXPERIENCE BLANK/PROBLEM
  • 09/10/2015 – CRITICAL CLASS DUTIES NOT SPECIFIC
  • 09/10/2015 – CERTIFIER RELATIONSHIP DISCREPANCY
  • 09/10/2015 – SPEC PROJ – EXPERIENCE VERIFICATION
  • 09/10/2015 – ADD’L SELF EMPLOYMNT INFO REQUESTED
  • 10/16/2015 – RETURNED APP RECEIVED BACK AT CSLB
  • 10/23/2015 – CORRECTIONS SENT TO BE SCANNED
  • 10/23/2015 – APPLICATION RETURNED FOR CORRECTION
  • 10/23/2015 – WORK EXPERIENCE BLANK/PROBLEM
  • 10/23/2015 – CERT DUTIES STILL NOT ACCEPTABLE
  • 10/23/2015 – SPEC PROJ – EXPERIENCE VERIFICATION
  • 10/23/2015 – ADD’L SELF EMPLOYMNT INFO REQUESTED
  • 12/09/2015 – RETURNED APP RECEIVED BACK AT CSLB
  • 12/24/2015 – CORRECTIONS SENT TO BE SCANNED
  • 12/24/2015 – APPLICATION RETURNED FOR CORRECTION
  • 12/24/2015 – WORK EXPERIENCE BLANK/PROBLEM
  • 12/24/2015 – CERT INCOMPLETE
  • 12/24/2015 – CRITICAL CLASS DUTIES NOT SPECIFIC
  • 12/24/2015 – EMAILED CERTS FOR ADDL CORRECTION.
  • 01/08/2016 – EXTENDED VOID DATE
  • 01/08/2016 – RETURNED APP RECEIVED BACK AT CSLB
  • 01/08/2016 – CORRECTIONS SENT TO BE SCANNED
  • 01/13/2016 – APP SENT TO SUPERVISOR FOR REVIEW
  • 01/25/2016 – ROUTED TO EXP ANALYST FOR REVIEW
  • 01/26/2016 – APPLICATION RETURNED TO PROGRM TECH
  • 01/26/2016 – DOCS INSUFF – EXPER NOT VERIFIED
  • 01/26/2016 – APP VOID – APP NOT PROCESSED
  • 01/26/2016 – APPLICATION IS VOID
  • 01/26/2016 – VOID LETTER SENT

Don’t put yourself in this position where you’re dealing with the CSLB changing the rules on you! Let me help you!!

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Contractor RMOs for Hire

The CSLB released their Winter 2015-16 newsletter last week. One article discussed contractor RMOs for hire.CSLB Gestapo Tactics

Section 7068.1 of the Business and Professions code states: …”responsible for exercising that direct supervision and control of his or her employer’s or principal’s construction operations to secure compliance with this chapter and the rules and regulations of the board.” And Code 823(b) states: “For purposes of Section 7068.1 of the Code, “direct supervision and control” includes any one or any combination of the following activities: supervising construction, managing construction activities by making technical and administrative decisions, checking jobs for proper workmanship, or direct supervision on construction job sites.”

823 states “any one or any combination,” so if you are using an RMO that is not directly related to your business you need to ensure that he/she is following these guidelines.

I talk to people almost daily who need to use an RMO who is not directly related to their business. I tell them that the RMO must be involved in the construction activities that will be conducted under the license and the same rules and responsibilities apply as they do to the license they currently hold.

What I think is at issue here is the broad definition of “direct supervision and control.” Does the RMO need to be on the job site to manage or make technical and admin decisions? Not according to the law. Remember, it states “any one or any combination” is allowed, that suggests “direct supervision on construction job sites” does not have to be a mandatory choice.

With this ambiguity I’m left wondering what the CSLB gestapo task force is finding during their “investigations”, what are they citing these contractors with, and what are the criminal cases truly about?

I’m sure any attorney worth his hourly fee would be able to punch holes in any CSLB case that involved 7068.1 and 823. So if you are using an RMO or you are an RMO and you do not have a direct relationship with the business, I suggest you become as active as possible with the work being done. Log all phone calls, keep all emails, review contracts and sign them if possible, review photographs, and yes… even drop by the job site if you can (even though the law cited by the CSLB does not require it).

Last comment…. if this is such a big problem that the CSLB had to create a “task force”, why don’t they just amend or remove B&P Code 7068.1? Get rid of the 20% rule altogether? Or is it easier to create an unregulated task force, pry into the business activities of licensee’s, write citations and criminal cases, and collect 100’s of thousands of dollars? Well…. they even say it themselves… “yielded big dividends”!

Full CSLB article below

RMOs-for-Hire Better Know What They’re Getting Into

CSLB has zeroed in on licensees who rent their services as Responsible Managing Officers (RMOs) for companies over which they have little or no control. Due to the work of a special CSLB task force that targets suspected RMO abuses, those who act as little more than paid license qualifier for companies are being identified and disciplined for violating state contractor law.

Contractors who serve as qualifiers for a company’s construction operations must exercise direct control and supervision, and, by law, maintain at least a 20 percent ownership stake in each firm for which the person acts as a qualifier. Business and Professions Code (BPC) section 7068.1 authorizes CSLB to discipline the licensed entity when the qualifier is not actively involved in the construction activities of the license they are representing. In addition to administrative penalties, the individual falsely serving as a qualifier on the license can be charged with a misdemeanor and be sentenced to serve up to six months in jail, and required to pay a fine of up to $5,000, or both.

CSLB’s effort to uncover straw men RMOs has yielded big dividends. There have been a total of 304 complaints filed against those suspected of misusing their qualifier status (many still under investigation), 31 accusations filed to revoke or suspend a license, 12 citations issued for violations of contractor law, 11 criminal cases filed by local district attorney’s offices, and $215,000 in restitution ordered for wronged consumers.

CSLB has strong words of caution for those who would enter these arrangements: If you act as an RMO and do not have active and financial involvement in the construction and business operations, you risk CSLB administrative penalties against your license(s) as well as criminal prosecution, regardless of whether you’re aware of substandard work being performed by unqualified individuals.

The task force also is watching for exam waiver requests from applicants suspected of only seeking to rent their name for a fee. CSLB also will seek to revoke qualifier status previously granted to anyone whose actions demonstrate they do not have an ownership stake or are not active decision makers listed on a license.

A review of BPC section 7065 will provide further explanation of examination waiver laws.

End of article

Very last comment…. do I think the CSLB should be taking action against the extremely small percentage of contractor RMOs for hire? Yes.  Should they create an unregulated task force with no oversight to invade the businesses of California contractors? …. Not just no, but hell no!

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