50. Are there any financial requirements to meet in order to qualify for a contractor's license?

Yes. All applicants for a new contractor's license, other than those applying for a joint venture license, must have more than $2,500 worth of operating capital. Operating capital is defined as your current assets minus your current liabilities.

51. Are there any bond requirements for a contractor's license?

Yes. It is your responsibility to file with the registrar a contractor's bond or cash deposit in the amount of $7,500 (except for the C-53, Swimming Pool classification, which requires a $10,000 bond or cash deposit). In addition, you must submit a separate Bond of Qualifying Individual or cash deposit in the amount of $7,500 for the responsible managing employee (RME) or the responsible managing officer (RMO). However, the CSLB may grant an exemption from the requirement to file a Bond of Qualifying Individual if the RMO certifies that he or she owns 10 percent or more of the voting stock or equity of the corporation for which he or she is to serve as the qualifying individual.

52. Where do I obtain bonds?

You may purchase bonds from your insurance agent or from one of the private holding companies licensed by the State Department of Insurance. The CSLB does not issue bonds. Copies of the approved bond form and information regarding cash alternatives to bonds are available from the CSLB upon request.

53. How long is a bond valid?

A bond may be issued for whatever length of time you and your insurance agent or bond company representative arrange. Most bonds are issued for a period of one to three years. At the end of that time, the bond may be canceled, or the bond company may request another premium to extend the life of the bond.

54. What is the total amount of fees I must pay to obtain a contractor's license?

Fees are subject to change. Current fees are printed on the application forms and notices distributed to you. You may call the CSLB to verify the fees. Currently, it costs a total of $400 in fees to obtain a contractor's license for one classification. This amount includes both the nonrefundable application processing fee and the two-year initial license fee.

55. Do I need to be concerned about workers' compensation?

All contractors are required to present proof of workers' compensation insurance coverage as a condition of licensure, to maintain a license, to activate an inactive license, or to renew a license, unless they are exempt from this requirement. Contractors who do not have employees working for them are exempt from the requirement for Workers' Compensation Insurance, but they will be required to file a certification of this exemption with the registrar. Neither the proof of coverage nor the exemption is required for an inactive license (see question #44).

56. How long is a license valid?

A contractor's license is initially issued for a two-year period. It will expire two years from the last day of the month in which it was issued. Licenses may be renewed for two years at a time if renewed on active status, or for four years if renewed on inactive status.