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If you're looking to practise construction work in California, getting licensed is a skilful place to beginning. Without the proper license, contractors can lose any and all rights to payment. It's hard plenty to go paid in construction every bit it is! In order to get a California contractors license, there are qualifications, applications, and exams along the fashion.

In this guide, you'll become a improve understanding of California'due south licensing requirements and the procedure involved in getting ane. Yous'll also acquire what can happen if you don't accept the appropriate license for your merchandise, and how it puts your payments at gamble.

Read more than: The Ultimate Country-by-Land Guide to Contractor License Requirements

Contractor licensing in California

Contractor licensing in California is a function of the Contractor Country Licensing Board (CSLB). Established in 1929, this governing body's primary goal is to protect consumers from predatory contractors and fly-by-night crews. The CSLB works to institute trade standards, ethics, and sound business concern practices in the state.

Larn more about the CSLB and how it works.

In California, the CSLB works to ensure that contractors aren't taking advantage of consumers. The board sets the requirements, standards, and testing for licensing. More often than not speaking, the CSLB requires almost all contractors to carry a license, with a few exceptions.

Only that's not all. The Statewide Investigative Fraud Team (SWIFT) works aslope the CSLB and performs regular stings and sweeps of construction sites to detect potential violations. The penalties can be steep — nosotros'll cover those further down.

Contractor licensing is critical in California

A license is not just some easy-to-come-by piece of paper. Information technology'southward important, both to the consumer and the contractor.

It protects consumers

The CSLB's entire purpose is to protect consumers from defective piece of work and inexperienced contractors. If you're considering hiring a contractor, be sure to check their license. Any project valued in backlog of $500 requires a contractor to concur a license, so don't take whatever excuse equally to why they don't have one.

Unlicensed contractors can often undercut the bid of a licensed company because they don't have to carry overhead expenses, like insurance or bonds. As a result, substantially lower projection estimates may be a red flag of an unlicensed contractor. CSLB regulations crave licensed contractors to carry insurance and bonds. Without the appropriate insurance, property owners could be liable for problems that occur on the job.

Without the required bond, the unlicensed contractor can skip boondocks without paying their subs. If these subs have licenses, they could potentially file a mechanics lien on your house for money you already paid to an unlicensed contractor.

Here are some quick links:

  • Look up a contractor's license number
  • Find a licensed contractor
  • File a complaint

It maintains contractor rights

As a contractor, information technology's critical to comport the appropriate license for your piece of work. If an unlicensed contractor performs work where a license is required, they lose all legal rights to collect payment.

They cannot file a California mechanics lien, bail claim, or whatsoever other claim in California for that matter. And missing out on payment isn't the cease of it: You could air current upwardly in jail.

If an unlicensed contractor performs piece of work where a license is required, they lose all legal rights to collect payment.

According to the CSLB, getting defenseless contracting without the appropriate license is a misdemeanor. A first criminal offense is punishable by up to 6 months in jail, a $5,000 fine, equally well equally administrative fines between $200 and $15,000. A 2d offense is a mandatory 90-twenty-four hour period jail sentence and a fine for up to 20 pct of the contract upward to $five,000.

California is besides very clear on payment disputes involving contractors without licenses. Unlicensed contractors take no remedy for non-payment. Equally an unlicensed contractor, if you perform $xx,000 on a project, and the owner chooses not to pay, y'all have no ground to stand on to recover your money. You lot tin't file a mechanics lien, and you won't be able to have information technology to court.

Performing work equally an unlicensed subcontractor when a license is a requirement in California puts your payments at take chances. Savvy GC's know this and tin can take advantage of you if they choose to, so be sure to go through the right channels to get your license.

Who needs a contractor license in California?

If you're wondering if you require a license in the State of California, the answer is probably yep.

The general rule is that a person or entity needs a license if they construct or alter any of the following if the total cost (including labor and materials) is $500 or more than:

  • Building
  • Road
  • Parking facility
  • Railroad + earthworks
  • Any other structure

This guideline goes on to state that contractors, subs, and specialty contractors engaged in home improvement must have a contractors license before submitting bids.

Substantially, these guidelines include all contractors. So, if you lot're a Full general Contractor, you must have a license. If you're a painter, you lot need a license. If your company installs windows and siding, get a license. In general, the CSLB is very strict on this point. However, there are a few exceptions.

Exceptions

A handyman service that completes projects less than $500 in value (including the cost of materials) do not need a license. But they cannot break a large job downwardly into smaller $500 projects to skirt this law.

The CSLB gives this example: Suppose you are remodeling the kitchen for a total price of $6,000. You sublet the flooring work, which is merely $300. The floor worker is non exempt from licensure, because the overall project cost was over $500.

Besides, owner-builders — those building a structure on their own property — do not need a license. The same exception applies to security warning company operators, satellite installers, or any craftsperson selling or installing finished products that practice non go function of the construction.

As yous can see, it's actually easier to name the trades and businesses that do non demand a license in California than the other mode around. The CSLB is extremely articulate on this topic. If you're working on projects valued in excess of $500 in California, the chances are that you need to go through the contractor licensing procedure.

Why you lot need a contractor's license in California

A general contractor license, as well as any license a sub might accept to carry, might seem like unnecessary cherry record. But that'south but not the case. In that location are many valid reasons why conveying a contractor license in California is important for your business and the land's interest.

A California contractor license makes you look professional person

If you desire to land the jobs that pay the big bucks, you demand to present yourself in a professional low-cal. Providing your customers with your license ID number buys them some peace of mind.

In short, a license is good for business concern.

A license ensures y'all're capable

The state doesn't want fly-past-night contractors working in construction, whether it exist commercial or residential work. Past passing the licensing exam, the country is certifying that you know what you lot're doing.

It ensures you lot're insured and bonded

The state also needs to ensure that contractors carry the correct insurance and bonds for whatever work they're doing. The best way to practise that is to require proof of those compliances in social club to get a license.

It's the law

Almost importantly, conveying a full general contractor license — or other contractor license types — is a legal requirement in California.

In fact, the land requires contractors, subs, and specialty contractors engaged in home improvement to carry a license before fifty-fifty submitting a bid. Not only are at that place fines and legal consequences (which we'll go into later in the article), but unlicensed contractors might not have mechanics lien rights every bit well.

How to get a contractor's license in California

While the procedure of obtaining a California contractor's license may seem daunting at beginning, it breaks down into only a few easy to manage steps. It begins with instruction, specification knowledge, correct application work, fee management, exam completion, and qualification. With the right information and experience the whole process can be completed with ease, just information technology all the same may exist difficult to predict how long information technology will take to get the license.

We'll go over all of this in detail, but before you lot apply for your license you need to make certain you lot're applying for the correct i.

1. Identify the license classification you lot need

Before y'all apply for your license, you demand to brand sure you're applying for the right one. There are three general types of contractor licenses in California. The type of work you do determines which license you demand.

Class A General Engineering Contractor License

The CSLB requires a Course A General Engineering science License for any contractor "whose main contracting business is in connection with fixed works requiring specialized engineering noesis and skill." This includes land leveling, earthmoving, excavating, trenching, paving, as well equally cement and physical work.

Projects typically requiring Class A licenses could include overpasses, underpasses, bridges, airports, power plants, pipelines, railroads, and highways.

These are large-scale, public works-type projects. Projects similar these will accept off under one or more engineers' licenses, commonly employed past a large construction company or engineering firm.

Class B General Building Contractor License

The CSLB requires a Class B General Building License for any contractor "whose chief contracting business concern is in connection with any structure congenital, existence built, or to be congenital, for the support, shelter, and enclosure of persons, animals, chattels, or movable property of any kind, requiring in its structure the use of at least 2 unrelated building trades or crafts, or to do or superintendent the whole or any part thereof."

Hither's the gist: Class B is a California license for full general contractors. If you are bidding on and taking prime contracts, you'll need a Form B license. With a Form B license, Full general Contractors can take the framing contract on a projection, but the projection must too include two unrelated trades besides.

Class C Speciality Contractor License

The CSLB requires contractors specializing in a particular trade to carry a Class C Specialty Contractor License. This license applies to electric, plumbing, and HVAC subcontractors, to name a few.

CSLB designates over twoscore unlike categories of Form C licenses. They include:

  • C-5 Framing and Rough Carpentry
  • C-9 Drywall
  • C-10 Electrical
  • C-27 Landscaping
  • C-29 Masonry
  • C-33 Painting and Decorating
  • C-36 Plumbing

If you're taking a prime contract on a project that does Non require two or more than unrelated trades, yous'll be fine with a Class C license, provided you hold the license for that specific work.

two. Run into the basic licensing requirements

The general licensing requirements in California are pretty straightforward. To qualify for a license in California, you must:

  • Exist eighteen years or older
  • Have the experience and skills necessary to manage the daily activities of a construction business concern, including field supervision (or have representation with the necessary skills and experience to serve as your qualifying individual)
  • Accept four years of verifiable feel at the journeying level, or as foreman, supervisor, or contractor in the classification you're applying for
  • Secure a $15,000 bond to protect consumers against lacking craftsmanship and employees from not-payment. If you're using a qualifying individual, their bond'south value is set at $12,500.

In that location are no additional financial requirements. This is to protect consumers from contractors flying nether the radar past claiming they don't earn plenty acquirement to qualify for a license.

Contractor education & credits

There are no educational requirements outside of those required to run into the journey level in your trade.

All the same, the CSLB may provide credit in the form of work experience for up to iii years for vocational preparation or an applicable apprenticeship. You lot tin can also receive a credit for up to one ½ years for an Associate of Arts in building or structure management, or three years for a bachelor's degree meeting certain requirements.

Note from the CSLB: "Please be aware that in that location are no schools or application preparation organizations that are affiliated with or agents of CSLB, although some may take company names that are confusingly similar to CSLB. If yous discover that an organisation has misrepresented itself as existence CSLB, y'all should submit a complaint to CSLB or the California Department of Consumer Affairs. Official CSLB examination study guides are available free of accuse on CSLB's website and are mailed to applicants when they are scheduled for exams."

California contractor licensing schools

  1. Find a community college with a construction program near you
  2. Research private schools with the California's Agency for Private Post-Secondary Education (BPPE). Search for canonical schools.

3. Fill out the licensing application

The beginning step in becoming licensed in California is to make up one's mind that you're eligible. There's a non-refundable $330 application fee, so be sure you run into the requirements before applying, else y'all could be out some cash.

If you lot meet the requirements for licensing, you'll need to fill out an Easy-Fill up or PDF application, or order a paper application.

The application requires the following information:

  • Full business proper name
  • Address information, including:
    • Public mailing accost
    • Physical location
    • Business concern phone and fax numbers
    • Electronic mail address
  • License type or form requested
  • Business entity type, including:
    • Sole proprietorship
    • Partnership
    • Express Liability Company, requiring:
      • $100,000 surety bail
      • $1,000,000 liability insurance policy
      • Identifying information for every officer, responsible manager, member, or managing director
    • Corporation (requires agile California Secretary of Land registration number)
  • Identifying information for the Qualifying Individual, including:
    • Proper noun, accost, engagement of nativity, social security number, and driver'southward license number
    • Current or previous CSLB license numbers
    • The percentage of the business organisation owned by the Qualified Individual
  • Identifying information for personnel, including:
    • Legal names
    • Dates of birth
    • Social security numbers
    • Addresses
    • Commuter'south license numbers
    • Championship or position
    • Personal phone numbers
  • Work feel breakdown, completed by the Qualified Individual

Post the completed awarding and the $330 application fee to:

CSLB Headquarters
Contractors State License Lath
P.O. Box 26000
Sacramento, CA 95826-0026

After the CSLB accepts the awarding, you'll receive a fingerprinting packet (which costs extra). Accept care of that ASAP, equally the examination discover should arrive within three weeks. If you take to reschedule the exam, additional fees will employ.

4. Consummate a background check

Once the CSLB accepts your application, y'all'll accept to submit fingerprints as part of the criminal groundwork cheque. The CSLB will contact you with how to become these taken care of, where y'all tin go, and ultimately, how much information technology volition cost.

After fingerprinting, a random choice process could require you to verify your work experience. You can use an employer, a General Contractor, a foreman or supervisor, as well as another journeyman for this step in the process. That person will demand to verify that you take the experience required to run a construction business concern.

Criminal background exclusions

If you have a confidence for a criminal offense on your record, you may nonetheless qualify for a license. The CSLB has the correct to deny a license for any conviction essentially related to the duties, functions, or qualifications of a contractor.

That said, the board may event a license if you've shown sufficient rehabilitation.

If yous're qualified, fingerprinted, and verified, you can schedule your CSLB examination.

5. Pass the California contractor licensing exam

Beyond the basic education and experience requirements, California contractors take to pass a licensing exam. One time the CSLB accepts your awarding, you'll accept to sign up for an exam at one of the following locations:

  • Fresno
  • Norwalk
  • Oakland
  • Oxnard
  • Sacramento
  • San Bernardino
  • San Diego
  • San Jose

Regardless of license, you lot'll take to laissez passer a Law and Business section to confirm that you're familiar with the laws and regulations that govern construction. The other half of the test will cover actual knowledge of the trade (or trades, in the Class B case).

Depending on the license type, an additional trade-axial section might exist a requirement. This section will ensure that the applicant has practical knowledge of the codes, best practices, and methods for the specific line of work for which they practical.

6. Submit bonding & insurance documents

If you pass, you'll accept more paperwork to practise. Yous have to submit proof of your bond, worker's bounty, and liability insurance. Yous'll also have to pay an initial licensing fee.

How much does a California contractor's license cost?

At a minimum, the total cost for a California contractor's license is $579. That does not include whatever extra fees for additional fingerprinting or a rescheduling an exam.

  • The application for licensing is $330.
  • The fee for the actual license is $200, and it's valid for two years.
  • Yous'll need fingerprints taken to ensure that your criminal background is accurate. The fee for fingerprinting is normally $49. Fees for boosted fingerprint rolling are a possibility.
  • If you have to reschedule your exam for any reason, at that place is a fee of $60.

Renewal fees

Once yous have your license, y'all'll have to maintain information technology with the CSLB. Agile licenses elapse every two years, while inactive licenses expire every four. The CSLB will send a renewal awarding roughly sixty days before your license is due to expire. You need to fill it out and send information technology back with the renewal fee.

Timing is everything with your renewal. If you send your renewal application in on time, an active renewal volition toll $450, while timely inactive renewals cost $225. If yous're late with your awarding, the fees spring to $675 for active and $337 for inactive.

The CSLB recommends ordering a renewal online if you lot don't receive a renewal application within 45 days of your license's expiration date.

Reciprocity: Transferring a license from some other land

If you already hold a license in another country, California may make it easier for you. The three states that California offers a reciprocal license with are Arizona, Nevada, and Louisiana.

In order to qualify for reciprocity, you lot must exist applying for a license that appears on California's Country Reciprocal Classification List. You must have held that license in good standing for the previous five years.

You'll then need to submit a Asking for Verification of License, completed by the already-licensed entity. Later that, it's an Application for Original Contractor'due south License.

If the CSLB accepts your request, you lot'll have to show proof of bonding, the necessary insurances, and pay your licensing fees.

Licensing timeline

Ultimately, it's difficult to provide even a crude timeline to suggest how long information technology will take you to get your license from starting time to finish, even if you lot pass your test on the showtime get. To become an idea of where each CSLB testing location is in the application process, you can bank check the CSLB Processing Times.

Penalties for unlicensed contractors

California takes unlicensed contract work very seriously. They hitting you lot where information technology hurts – both in your walletand with potential criminal penalties (we'll get to those in a second).

Fiscal penalties

If you are supposed to have a license, and do non, you have cipher recourse for payment in any way. Nada. Cypher.

Under California constabulary, an unlicensed contractor "may not bring or maintain" any action for compensation for performing any deed or contract for which a license is required unless the contractor was duly licensed "at all times" during functioning of the chore.

Keep the phrase "at all times" in heed. Even if you were licensed when yous started a projection, if your license expires or is suspended for any reason, the aforementioned penalties use.

Perhaps even more severe than that is the "disgorgement" principle. It's an ugly sounding word, but it basically but means to "give dorsum" ill-gotten gains. An unlicensed contractor may be required to disgorge ("give dorsum") any past compensation.

So whatever money that you fronted for materials and labor are now lost. What's even worse? You may cease up paying taxes on the money earned likewise!

Criminal penalties

Now on to criminal penalties! A first law-breaking of unlicensed contractor piece of work is a misdemeanor which tin include upward to six months jail time and/or $5,000 fine. That doesn't include administrative fines that can range anywhere from $200 to $xv,000.

A second crime comes with a mandatory 90 day jail time and a fine of either twenty% of the total contract price or $five,000. If that wasn't enough, you tin face felony charges also. If you illegally use another person'southward license or pretend to be licensed, information technology's considered a felony. So is unlicensed contract work during a declared state of emergency or disaster (unless the rules have been relaxed past the appropriate governing bodies).

The bottom line on licensing

California takes unlicensed contractor work very seriously . If yous are a contractor or sub in California, it'south well brash to not perform any work on a construction projection without a valid California contractors license in place at all times. Without it, y'all could be in trouble.

Summary

Article Name

Contractor's License California - Understanding the Rules

Description

Without a California contractors license, contractors in California could face fines, penalties, and fifty-fifty misdemeanors or felonies. If you don't want the California Contractors State Licensing Board (CSLB) knocking on your door - make certain yous've obtained the necessary licensure to perform your work.

Author

Alex Benarroche

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levelset

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