Message From the Board Chair
Good cheer to all as we start off a new year. The Board hopes CSLB licensees are still in a merry mood from the last year's rebound in construction and home improvement spending. According to an Associated General Contractors of America analysis, California topped all other states with 41,000 construction-related jobs created from November 2014 to November 2015, a 5.9 percent increase from the previous year.
There's every reason to expect 2015's positive trend will continue in 2016. With the economic recovery in full swing, CSLB expects to be busier than ever living up to its industry oversight and consumer protection responsibilities.
We're grateful to have the support of the Legislature and the Governor in addressing several needed changes in contracting law for the upcoming year.
The most far-reaching of the new laws involve CSLB's home improvement salesperson (HIS) registrations. The number of persons applying to become HIS, particularly in the fast-growing solar industry, has jumped in recent years and in turn put pressure on CSLB's HIS registration process.
Recognizing that application delays hurt salespersons and the contractors who hire them, CSLB sponsored legislation for a change in the law to permit a single HIS registration even when representing multiple contractors. More details on the changes are described in a separate story in this issue.
"We're grateful to have the support of the Legislature and the Governor in addressing several needed changes in contracting law for the upcoming year."CSLB supported two other pieces of legislation that became law on January 1, 2016. By now, hopefully, all licensees have received notice about the new contractor bond amount of $15,000 and double-checked their coverage before doing business in 2016. While no one likes paying a few more dollars for a bond, the Board felt that a new bond limit was justified for the increased consumer protection it will provide.
At the same time, the law lifted the requirement that new licensees have $2,500 of working capital before starting their contracting business – a section of contractor law that CSLB believed was outdated and no longer needed.
On the enforcement front, another new law grants CSLB representatives the authority to issue citations if they encounter cases of workers' compensation (WC) insurance fraud. Previously, only peace officers and district attorney's offices could take action against alleged offenders.
That gives CSLB a more direct and effective way to deal with WC violations when uncovered. It's part of a larger CSLB strategy to identify contractors who purposely evade their responsibility to get WC insurance for their workers and themselves if necessary. CSLB suspects that many WC exemptions are being claimed by licensees who do have employees, and by doing so are exposing themselves, workers, and clients to serious legal jeopardy if an accident happens on the job.
Again, CSLB realizes this is another bottom-line expense, but one that is absolutely necessary and has to be factored into the cost of doing business. Another story in this issue describes CSLB's efforts to bring more contractors into workers' comp compliance.
You also may be pleased to hear that the Board, at its last meeting, gave CSLB's Statewide Investigative Fraud Team (SWIFT) the go-ahead to conduct more sting operations in 2016. Statistics have shown that stings are a particular effective enforcement tool against unlicensed contracting and the underground economy. With that data in hand, Board members were glad to give our investigators more help to pursue unlicensed operators.
Just as you do with your business, CSLB is always looking to improve its operations and make its services more accessible to licensees and consumers. You can offer your input on our website, or voice your opinion at Board meetings held quarterly at locations around the state.
I hope you and your family will enjoy and safe and prosperous 2016.
Respectfully,
Ed Lang
CSLB Board Chair
