Capitol Connection Q&A for Contractors - Week of February 4, 2018

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By Shauna Krause, President, Capitol Services, Inc.

Not only sure, I am ‘surety’ about this answer that corrects a contractor’s mistaken ‘impression.’ Another contractor will have to ‘divide’ his experience in his request to ‘subtract’ a Qualifier and ‘add’ another, and I give a ‘concrete’ example of why your ‘state’ of mind matters in answering questions from across the West!... 

Q:  We are currently converting our contracting company from a Corporation to an LLC.  The CSLB is requesting a $15,000 Contractors Bond and a $100,000 LLC Bond.  We were under the impression that we could just add the LLC to the Corporation’s bond and thus wouldn’t have to get a separate Contractor’s Bond for the LLC.  However, the surety company is telling us the State doesn’t allow two bonds holders on the same bond, even if one is a parent company to the other.  Is this true and thus do we have to get a separate bond for the LLC?

A:  Yes, the surety company is correct.  You cannot have two entities share the same bond.  Bonds are not transferrable from one entity to another either, so in addition to the $100,000 LLC/Worker bond, you will need to obtain a new $15,000 Contractor’s Bond. 

Q:  Your Company is helping me with replacing my Qualifying Individual on our license with a request to Waive the trade exams.  I’ve been the President of the company since 1986. We hold the “A” (General Engineering) and a “C-51” (Structural Steel) classifications.  I noticed you sent me two Certification of Work Experience pages to have completed.  Would the State view my application as stronger/better to add more certification pages?  I have many contractors and clients who can vouch for my experience. Would it be acceptable for the current Qualifier who I’m replacing to complete one of the pages for me?

A:  Since you have worked for the same company for over four years, it is not necessary to have more than two Certification pages completed. We sent you two certification pages because one should be specific to your General Engineering work, and one should be specific to your Structural Steel background.  The certification pages can be completed by anyone who has direct knowledge of your background in each trade, and in fact can be completed by the same person.  Your current Qualifier would be a perfect person to certify your work history since he has also been on the license since it was issued in 1986.

Q:  If a person wants to come in and buy an existing contracting business and make the seller who holds the license an RME for the new business, can the buyer continue to operate with the seller’s license, or will they have to get a new license number?

A:  It depends.  If the transaction is a stock sale, the buyer can keep the existing license number and make necessary changes to it (personnel, business name, etc).  If the transaction is an asset, a new Contractors license is required.


CLARIFICATION: In the Q&A article published on 1/22/18, we referred a “C-8” classification as a “glazing” license without specifying what State the contractor was referencing.  A reader pointed out a “C-8” contractor in California is a Concrete contractor and “C-17” contractors are Glazers.  What the article should have included is a “C-8” contractor in Nevada is in fact a Glazing contractor. Nice catch thanks for reading! 

While knowledge is power, knowing where to go for the answers is half the battle. Get expert assistance immediately when you call 866-443-0657, email info@cutredtape.com, or write us at Capitol Services, Inc., 1225 8th St. Ste. 500, Sacramento, CA 95814. Research past columns at www.cutredtape.com.

 

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