What is old can be new again, but databases never forget the past! No crystal ball so I can only share my condolences and an expert solution for the unexpected problem, and offer advice to a hopeful future license contractor…

Q: My company (OldCo) was recently acquired as an asset sale by NewCo. NewCo obtained a new license with OldCo’s business name as their dba. OldCo was kept in place just to make sure there was no lapse in licensure between the two entities. Once NewCo became licensed, I cancelled the bonds and Worker’s Comp insurance in relation to OldCo which caused the license to become suspended.

Not a big deal since we aren’t using it, BUT when you search the CSLB license check website by the dba name, two licenses show up, one showing “suspended” and one showing “active”. The suspended license could cause a red flag to potential clients. Is there a way to correct that so OldCo’s license no longer shows up?

A: We can cancel the suspended license, however there is no way to take them off the database completely. If we cancel them, they will just show up as “cancelled” instead of suspended. Also note the OldCo license is set to expire at the end of the month here so you can also just wait a couple weeks and it will show “expired” instead of suspended.

Q: We have a corporation license and our qualifier passed away unexpectedly. We have ongoing projects, employees, and open contracts. I read we have 90 days to replace him as the qualifier on the license and I would be the person to take over, however I don’t know that I want to add my name to the license because of the liability. I don’t know yet what the financial status of the company is. Are we able to request a continuance in the meantime while we make decisions about what will be the outcome of the company?

A: Sorry to hear about your Qualifier. Because the license belongs to the Corporation as a whole, a continuance cannot be granted to a corporation or LLC. Once you have an application to replace the Qualifier in process, you are able to request a onetime 90-day extension which will give you some more time to decide what you are going to do. During the 180 days, you can continue business as usual.

Q: We have several businesses in California with licenses. We seem to continually be dealing with qualifiers disassociating which in turn leaves the company scrambling to replace them within the 90-day time limit. I would like to explore the option of spreading our more “permanent” qualifiers across multiple locations.

Am I correct that a Responsible Managing Officer (RMO) can have their license used at up to three locations? And a Responsible Managing Employee (RME) is limited to just two? 

Lastly, I’m assuming the RMO/RME is required to be employed by the company as opposed to an independent contractor?

A:An RMO can have their license used for up to three licenses within a one-year period as long as one of the following exists: 

  1. They own at least 20% of each company
  2. One company owns at least 20% of the other, 

OR

  1. The majority of the personnel are the same on each license (this is the condition you guys use).

RME’s can only be on two if (b) or (c) listed above is true, you are correct. You are also correct regarding the employment of the RME/RMO; he/she should be employed by the company as opposed to a 1099 contractor.

Under a new rule, as of this January 1, CSLB will not process renewals for these licenses without proof of worker’s comp insurance, regardless of having any employees.

Q: I had a contractor’s license years ago, but I let it go when I went to work for a company who was already licensed. I want to reactivate my license. What does that require? I’ve tried calling the CSLB, but I’ve gotten a couple of different answers, so my buddy referred me to you.

A: Good call, pleases pass along my appreciation to your friend. I looked up your license and it has been expired for over five years so you will be required to take the exams again to get the license back. You will also need to be fingerprinted and obtain a bond. Since it’s a Sole Owner license, you can request that the number be re-issued to you. We of course would be happy to assist you with the process.

By Shauna Krause, President, Capitol Services, Inc.- www.cutredtape.com