General Requirements 1. Who can become a licensed contractor? To qualify to become a licensed contractor an individual must be 18 years of age or older and have the experience and skills necessary to manage the daily activities of a construction business, including field supervision, or must be represented by someone else with the necessary experience and skills, who serves as the qualifying individual. The contractor or other person who will act as the qualifying individual must have had, within the ten years immediately before the filing of the application, at least four full years of experience at a journey level, or as a foreman, supervisor, or contractor in the classification for which he or she is applying. The experience claimed on the application must be verifiable and individuals who have knowledge of the experience must certify the accuracy of the experience information provided by the applicant (page 3 of the application). 2. Who must be licensed as a contractor? All businesses or individuals who construct or alter any building, highway, road, parking facility, railroad, excavation, or other structure in California must be licensed by the California Contractors State License Board (CSLB) if the total cost (labor and materials) of one or more contracts on the project is $500 or more. Contractors, including subcontractors, specialty contractors, and persons engaged in the business of home improvement (with the exception of joint ventures and projects involving federal funding) must be licensed before submitting bids. Licenses may be issued to individuals, partnerships, corporations, or joint ventures. The CSLB does not issue licenses to Limited Liability Companies (LLC's). 3. Is anyone exempt from the requirement to be licensed? Yes. Here are some of the exemptions: Work on a project for which the combined value of labor, materials, and all other costs on one or more contracts is less than $500 falls within the minor work exemption. Work which is part of a larger or major project, whether undertaken by the same or different contractors, may not be divided into amounts less than $500 in an attempt to meet the $500 exemption. Unlicensed contractors must provide the purchaser with the written disclosure in B&P Code section 7048 stating that they are not licensed by the CSLB, or the $500 exemption does not apply and that a citation can be issued for work completed by an unlicensed contractor; An employee who is paid wages, who does not usually work in an independently established business, and who does not have direction or control over the performance of work or who does not determine the final results of the work or project; Public personnel working on public projects; Officers of a court acting within the scope of their office; Public utilities working under specified conditions; Oil and gas operations performed by an owner or lessee; Owner-builders who build or improve existing structures on their own property if they either do the work themselves or use their own employees (paid in wages) to do the work. This exemption is only valid if the structure is not intended or offered for sale within one year of completion; Owner-builders who build or improve existing structures on their own property if they contract for the construction with a licensed contractor or contractors; Owner-builders who improve their main place of residence, have actually resided there for one year prior to completion of the work, and who complete the work prior to sale. This exemption is limited to two structures within a three-year period; Sale or installation of finished products that do not become a fixed part of the structure; A seller of installed carpets who holds a retail furniture dealer's licenses but who contracts for installation of the carpet with a licensed carpet installer; Security alarm company operators (licensed by the Bureau of Security and Investigative Services) who install, maintain, monitor, sell, alter, or service alarm systems (fire alarm company operators must be licensed by the CSLB); and Persons whose activities consist only of installing satellite antenna systems on residential structures or property. These persons must be registered with the Bureau of Electronic and Appliance Repair. 4. Do I have to reside in California to get and keep a contractor's license? No. 5. Does California recognize contractors' licenses issued by other states or countries? No. However, California does have reciprocal agreements with some states that recognize the experience qualifications for certain trades. It is only after the Registrar of Contractors has entered into a reciprocal agreement with the other state and under certain conditions that the Registrar may waive the written trade examination for a contractor licensed in another state. Applicants must still qualify by taking and passing the Law and Business Examination. If you have trade experience or a contractor's license issued by another state or country and you want to contract for work in California, this experience may be acceptable. In any case, you must apply for and be issued a license by the California Contractors State License Board. 6. What happens if I contract without a license? A contractor's license is not necessary as long as you advertise yourself as an unlicensed contractor, provide your customers with a written statement that you are unlicensed (see Question 3), and never contract for jobs costing $500 or more, including labor and materials. The Contractors State License Board has established statewide investigative fraud teams that focus on unlicensed contractors and the underground economy. These units conduct stings and sweeps to curtail illegal contracting activities. Contracting without a license is a misdemeanor. Unlicensed contractors face potential sentences of up to one year in county jail and potential administrative fines from $200 to $15,000. The CSLB filed 1,136 nonlicensee citations and referred 854 nonlicensees to the District Attorney during the 2001-2002 fiscal year. Stings and sweeps are publicized to ensure maximum consumer education.