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On Licensing Contractors and Cowboys

In Great Britain they call them cowboys, those unscrupulous, unskilled and historically unbridled
building contractors who prey on an unknowing public by leaving them with incomplete
and poor quality construction projects . . . and vanishing into the night. In America, we call
them scam-artists, fly-by-nighters and just plain crooks. But regardless of the moniker, the
rogue contractor does and always has given the building industry a bad name and remains a
heavy burden on those of us who practice our craft with responsibility, dedication and professionalism.
The problem is real and only demonstrates that we all (unfortunately) live in a
day when it’s incumbent on the reputable portion of the industry
(and the public) to take steps to control those who have
strayed. And one popular suggestion for doing just that is
through contractor licensing.



In the United States, we already require that some (mostly trade-specific)
contractors be licensed, but the practice is fickle.
Depending on where you live and work, requirements for
licensing can vary markedly. General contractors in your state
may be required to test rigorously to obtain a license while the
state right next door may require no licensing at all. This creates
situations (and I was one of these) where, while living near
a state line, one of your projects will fall under entirely different
licensing requirements than another only minutes away, It
can be confusing and frustrating for you and your customer.



So why not just be done with it and license all contractors? After
all, isn’t it paradoxical to live in a world where pets and bikes
require licenses and contractors don’t? Besides, architects, engineers and land surveyors (all integral parts of the construction
process) are required to prove education, pass testing and obtain
a license to practice in their states, so shouldn’t the contractor
too?



Unfortunately it’s not that simple. There are forces both pro and
con who fight voraciously for their respective sides. Strong
opposition by construction groups, unions and politicians (con)
have historically led the charge against licensing. They argue
licensing violates the contractor’s right to free enterprise and is
just one more burden the government imposes on honest, hard-working,
tax-paying business people. On the other hand, consumer
groups, pro-politicians and government entities (often
trade related) wave the banner for public safety, construction
quality, consumer confidence and industry integrity as reasons
to implement licensing. Also on the pro-side are licensed contractors
who argue their unlicensed counterparts create unfair
competition in workplace by not paying the same state/local
taxes, fees and state benefits (unemployment, workers’ compensation, etc.) and use those savings to undercut their “legitimate”
prices.



Case by Case, State by State




Of course the problem with any good debate is that both sides
likely have valid points within their arguments. That’s what
makes the decision to license so arduous. That’s also why—as
happens with many thorny regulation issues—licensing hasn’t
found consensus on a national level and subsequently finds itself
primarily in the lap of individual state and local governments.



But that’s not to say there isn’t help on the national level. Groups
like the National Association of State Contractors Licensing
Agencies, an organization in Arizona, provides an annual publication
that lists contractor licensing requirements by individual
state and further gives information regarding regulation,
continuing education, testing locations, alternative certification
programs and more. NASCLA also advocates standardization
of state contractor licensing tests and works with individual
states toward that goal. You can find them online at
www.nascla.org or you can contact them at NASCLA, P.O. Box
14941, Scottsdale, AZ, 85267, phone (480) 948-3363, fax
(480) 948-4117, e-mail: [email protected].




However, even with this help, it will likely be your own state
and local governing bodies that will offer up the nuts and bolts
of your particular licensing requirements. But how much difference
is there really from state to state? Well, to know where
we’re going, we should know where we are. Let’s look at a few
examples. First, it’s not surprising that states with above-average
population growth, vulnerability to natural disasters and
histories of contractor abuse seem most receptive to contractor
licensing scenarios. Take California for instance (according to
the Contractors State License Boards Web site,
www.cslb.ca.gov). Currently, California licensing law calls for
the following general and specialty trades to be classified and
tested for trade competency, qualified by experience, and
licensed:



General Engineering Contractor — Fixed works, such as irrigation,
drainage, water power, water supply, flood control, inland
waterways, harbors, railroads, highways, tunnels, airports and
runways, sewers and bridges) and . . .



General Building Contractor — One whose contracting business
is in connection with any structure built or being built for
the support, shelter and enclosure of persons, animals, personal
property or movable property of any kind, requiring in its
construction the use of more than two
unrelated building trades or crafts. This
means a contractor hiring three subtrades
other than the work they self-perform
must have a general building contractor’s
license.



But in addition, California law also
requires licenses of certain specialty trade
contractors, such as these:


Now, compare that to, say, Wisconsin,
where the requirements (in Wisconsin,
they often refer to “credential” is lieu of
“license”) and the trades affected vary
somewhat and are far less in number
than those in California. In Wisconsin
(www.commerce.state.wi.us/sb/sbdivprogramslisted.
html), general con-tractors
may be unlicensed, and only the
following specialty trade contractors are
required to obtain separate credentials:





There appear far more “hoops” to jump
through in California than in Wisconsin, but given California’s population
expansion and history for natural disasters,
it’s probably no surprise. In addition
(and similar to other states), those
working on Wisconsin Department of
Transportation projects and out-of-state
corporations are also required to be credentialed.


But even should you pass state requirements, you may not be out of the
woods. You may be also be required to
be licensed on a local/county level.
Orange County in California and Cook
County in Illinois are only two places
that may require additional licensing. In
New York state, all work (except for
asbestos abatement) is regulated at a
local level.



Or take Fairfax, Va. The Commonwealth
of Virginia (www.fairfaxcounty.gov)
requires that if you, the contractor, are
bidding on construction jobs in excess of
$1,000, you must (first) obtain a Virginia
contractor’s license. Fairfax County then
has opted to impose an additional
requirement, a Fairfax County Home
Improvement License, on certain contractors
who perform work on residential
property and who qualify by having the
Home Improvement or Building classification
on their state license.



So check out your local situation as well.
And we’re not done! In addition, this still
doesn’t account for any industry-specific
certifications that might pop up, such as
often accompany work in nuclear, medical,
technologies and even some main-stream
sectors.




More Than a License: Countinuing Education



But a license isn’t just a piece of paper.
One of the main points of licensing is to
provide the public with continual quality
product and service, so many states
mandate the person or company wishing
to maintain a accreditation (after the
initial license has been granted) complete
continuing education require-ments
related to their field. CE is a
means to keep the contractor abreast of
the latest innovations and techniques
through ongoing training. CE can come
in the form of seminars, workships, educational
courses (often with hourly
incremental requirements), training programs
and more. Instruction classes can
be conducted by accredited private construction
organizations, unions, colleges/
universities, mainstream industry,
or other entity approved to administer
that training by the governing body.



As part of the process, the contractor
must then in turn provide proof to the
licensing board that they’ve completed
the required learning to be re-licensed.
Besides providing knowledge to the
individual, CE also helps provide professionalism
and integrity to an industry
sometimes viewed suspiciously by the
public. It shows the consumer that the
construction industry cares about quality
and keeping up with their craft.



The obvious conclusion one can draw
from all this is you will need to check
out more than one source to ensure
you’ve met the proper licensing guide-lines
for your location. A good place to
start might be some of the Web sites
we’ve noted in this article. You can also
log on www.contractornet.com to view
licensed contractors listed by state, or
conduct your own search. There’s a
wealth of information available to you
online.



As for the licensing debate itself, it goes
on. There’s little doubt that unskilled,
unregulated contractors can and do pose
an obstacle to professionalizing our
industry and help perpetuate the “scam-artist”
perception that some of the public
harbors. Licensing may be one corrective
avenue in controlling the damage.
As for your situation? Do your
homework and never assume the last
credential you got was really the last
one.


About the Author

S.S. Saucerman retired after 26 years in
the construction industry. Today he is
writing, speaking and consulting on a
full-time basis.

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