Each of the 50 states in the United States has its own laws that contractors must comply with. In California State, the Department of Consumer Affairs, Contractors States License Board (CLSB) is saddled with this responsibility. The board is also responsible for administrative services to contractors and their clients and investigating related complaints.
California Contractor License Requirements
To become a licensed contractor in the Golden State, you will need to:
- Be at least 18 years of age
- Be a U.S. citizen or legal resident
- Provide passport photographs
- Hold a $15,000 worth of bond
Who Needs the License?
According to the CLSB, becoming licensed is a must if you are to work on a project with the total cost (materials and labor) of $500 and above. This involves all businesses or individuals who construct or alter any structure, such as building, road, highway, parking facility, excavation, or railroad. The requirement applies to contractors, specialty contractors, subcontractors, and anyone engaged in the business. It is a major prerequisite that must be fulfilled before you can submit a bid for a project within the state.
Penalties for Working Without a License
Being an unlicensed contractor is a gross violation of the California state law. It can lead to criminal or civil actions against any offender. If you are caught contracting jobs or advertizing yourself as a contractor for jobs worth $500 and above, the CSLB will initiate legal or criminal action against you up in the following ways:
This is usually treated as a misdemeanor, carrying a possible sentence of up to 6 months in jail and/or a fine of $500. Depending on the outcome of the investigation, it can also attract a potential administrative fine $200 to $15,000.
Subsequent convictions will increase the penalties, which could cost a fine of 20% of the total price of the project done, or a $4,500 fine. Such an offender shall also be confined to jail for at least 90 days.
It is, therefore, highly recommended to get the license and avoid legal actions that could lead to a setback for your business. The consequences can also ruin your overall trajectory and long-term projection.
What if I Don’t Meet the Requirements for a License?
If you do not meet the California licensing requirements for contractors, you may qualify for a license under a “qualifier.” A qualifier, according to CSLB, is a person captured on the board’s records who meets the requirements for a license.
Can I Work in Another State With California Contractors License?
California has contractor license reciprocity with Utah, Arizona, and the Nevada States. If you are to work in any of these states with CSLB license, or vice versa, you stand a higher chance of landing the job than in other states. This doesn’t automatically guarantee you the right to work contract with those state’s license, but it removes some of the requirements in the license examination.
The advantage will help fast-track the bidding process as you get to complete the whole process ahead of other potential competitors. You might also qualify for a waiver for some of the examination requirements. Bear in mind that reciprocity agreement doesn’t work in all classifications of California contractor license. It is awarded only in specified, similar classifications. For example, Arizona license code A-21 for landscaping will be accepted as equal to California landscaping license code C-27. Any contract outside the accepted code will not be authorized.