Category Archives: Contractor Business

C-2 Insulation and Acoustic Contractors License: The Complete Guide

Thinking of going into the insulation business? Apprentice insulation professional looking to make the jump and start your own business? Spot a gap and want to corner your area’s soundproofing market?

You’ve come to the right place. This guide provides in-depth information on what a C-2 contractor does, the job types they handle, job examples, limitations, and success strategies, drawing from a range of sources for the most comprehensive overview.

What is A C-2 Insulation and Acoustical Contractor?

A C-2 Insulation and Acoustical Contractor is a specialist who installs insulating media and performs architectural acoustical material for temperature and sound control.

A C-2 contractor handles anything to do with insulation – installing, removing, adjusting, and so on. As the license itself says, this license covers all types of insulation, whether thermal or acoustical.

C-2 contractors usually work on residential installs, but they also find a lot of work in office buildings, working on constructing ceilings for giant offices and data centers. A big niche that falls under this category is soundproofing: an area that has become more and more important as modern life has become louder and more intense than ever – creating a need for builders to soundproof their assets to stay competitive.

Types of Jobs for C-2 Contractors

C-2 Contractors do a number of different roles, many specialized, and many general. The common thread amongst all jobs is they require some structural understanding, along with the obvious insulation and acoustical expertise required.

  • Soundproofing Contractors
  • Ceiling Contractors
  • Insulation Specialists
  • Home Insulation Contractors

Whether you’re installing insulation or soundproofing, you need this license. You can also operate a business that provides both services under the same license – a way to double or triple your income.

Typical C-2 Contractor Jobs

The C-2 license is one of the broadest, most flexible Class C contractor licenses out there. Every house needs insulation, especially in the infernal California heat – but the scope of the C-2 license goes much further than that.

Here are some of the most common jobs a C-2 Contractor does.

  • Suspended Acoustical Ceilings: Implementing overhead sound control systems in buildings.
  • Specialty Ceilings: Designing and installing unique ceiling types for aesthetic and functional purposes.
  • Demountable Partitions: Building modular partitions that can be easily moved or reconfigured.
  • Sound Absorption Insulation: Installing materials specifically designed to absorb and reduce noise.
  • Commercial Insulation: Implementing insulation solutions in commercial buildings for energy efficiency and sound control.
  • Residential Insulation Installations: Providing insulation in homes to improve thermal efficiency and reduce noise.
  • Grid Ceiling Systems: Setting up grid-based ceiling frameworks, often for drop ceilings. Ubiquitous in office parks and data centers.
  • Scaffolds and Ladders for Access: Setting up temporary structures for access to high or difficult-to-reach areas during installation.
  • Air Filtration Prevention: Ensuring buildings are airtight to enhance energy efficiency and control sound transmission.
  • Pipes and Ductwork Insulation: Some C-2 contractors work with HVAC contractors to insulate piping and HVAC ducts to reduce energy loss and noise.

Duties of a C-2 Contractor

What duties does a C-2 contractor have on-site? Here are some of the daily tasks you can expect to be doing as a C-2 contractor.

  • Installing various ceiling systems and insulation boards.
  • Batt, rigid board, and radiant barrier applications.
  • Building sealing for air filtration prevention.
  • Soundproofing and Weatherstripping.
  • Safe job site maintenance
  • Project estimation and financial management​​
  • Customer service

Limitations of C-2 Contractor Work

A C-2 Insulation and Acoustical contractor is legally restricted from bidding on projects outside their specialization, ensuring a focused and expert approach to their field of work​​.

Unless you’re a Class B General Contractor, you can’t perform any jobs outside of insulation or acoustical work without facing legal and potentially criminal penalties via the CSLB.

7 Steps To Success as a C-2 Contractor

How do you set yourself up for success as a C-2 contractor? Here’s some of the fundamentals of growing and maintaining a successful contracting business in the insulation and acoustical industries.

  • Conduct Market Research: You need to do your research when it comes to launching an insulation or acoustical business. Without a basic understanding of your local market, you have no chance of succeeding.
  • Establish a Business Niche: Once you’ve done your research, you can find the opportunities in your area. Find a service with few competitors that you can provide better than anyone else – and make it your specialty.
  • Set Up a Pricing Strategy: Your pricing should cover all costs while being competitive. You’ve already done your research so you should know what this price is, compared against others in your area.
  • Get Your CSLB License and Register Your Business With The S.O.S.: Register your business with the California Secretary of State and obtain the necessary C-2 license. It’s best to work with an attorney to ensure proper paperwork and compliance with state requirements​.
  • Start Marketing: A contractor that isn’t marketing is a contractor who is losing business. Invest in some money towards ads, SEO, and physical marketing – paying an expert to do this will pay off huge dividends.
  • Provide Exceptional Service: The absolute best thing you can do is to provide the best service in the area. If you leave your customers happy, they will be ecstatic and recommend you to others, both in-person and online.
  • Stay Up-to-Date on Industry Trends: Keep abreast of industry trends, especially in energy efficiency. This will help you stay competitive and offer the most current solutions to your clients, while also ensuring you stay compliant with California laws.

How To Get Your C-2 License

In order to get your CSLB C-2 License, you need to fulfill certain requirements. Once you meet all of these, getting your license is easy. Simply apply for your license, pass the exam, provide insurance, and – boom! – you’re a C-2 contractor!

  • Experience: A minimum of four years in the insulation and acoustical field.
  • Qualifying Individual: A manager with four years of relevant experience and a valid C-2 license who can vouch for your experience.
  • Application Submission: Providing detailed work and personal background information to the CSLB.
  • Pass the CSLB Exam: Pass both the Law and Business Examination and the Trade Examination.
  • Pass A Background Check: A comprehensive criminal background check.
  • Obtain And Show Proof of Bonds and Insurance: Obtaining a contractor’s license bond and adequate liability insurance. Note that insurance requirements have changed for California contractors in 2023!
  • Pay Fees: Pay the associated fees to the CSLB.

Conclusion

The C-2 Insulation and Acoustic Contractors License is an often-overlooked option for young people who want to get into construction. Considering how important insulation is – and will only continue to be – in our sun-baked state, there’s never any shortage of jobs for people who can provide good insulation services.

If you do your research, put in the hours, and market yourself well, there’s no reason you can’t be a huge success as a C-2 insulation contractor.

Can a Contractor Put A Lien On My House?

Most people who own their own homes – and thereby, have to hire contractors to build, fix, or otherwise modify their properties – have absolutely no issues with their contractors. Most contractors are trusted professionals in their fields and have no intention of delivering anything less than what they’ve agreed to in the contract.

But there are always exceptions. Especially in states that don’t require contractors to be licensed, or are lacking in general oversight, there are definitely a share of contractors who have less-than-honorable intentions with taking on your job.

In situations where there’s a dispute over the work done (or not done) and the payment for said work, the idea of a mechanics lien often comes up in the conversation. You may have heard someone say: “they can put a mechanics lien on your house” in case of nonpayment for contracting services.

Is that true? Can any contractor put a lien on your house in the case of a pay dispute? And if so, what are the consequences of having a lien put on your home?

Let’s find out.

Mechanics Liens: An Overview

So what is a mechanic’s lien?

According to the CSLB, a mechanics lien is a “‘hold’ against your property, filed by an unpaid contractor, subcontractor, laborer, or material supplier, and is recorded with the county recorder’s office. If unpaid, it allows a foreclosure action, forcing the sale of the property in lieu of compensation.”

In simpler terms, a mechanics lien is a legal claim made by contractors, subcontractors, laborers, and material suppliers against a property when they haven’t been paid for their services or supplier. This is a recourse for anyone in the construction industry to receive payment for services rendered, but not given.

If you’re a contractor, you know you’re often paying out of pocket for materials and other supplies – which you then recoup when you are paid for the work done. A mechanics lien is a way to make sure that you aren’t out whatever you spent to get the job done in case of non-payment.

The mechanic’s lien is a legal measure that ensures construction professionals receive their due compensation for the work done or materials provided. It serves as a safety net for every person in the construction industry, ensuring that hard work (and all the costs associated with it) doesn’t go unpaid.

Who Can File a Mechanic’s Lien?

In California, basically, anyone involved in a construction project can file a mechanics lien in the case of non-payment.

This includes general contractors, subcontractors, laborers, and material suppliers. If you’re a general contractor and you don’t get paid by the client – you can file a lien. If you’re a roofer who did one day of work on a job, were paid, but less than the amount in the contract – you can file a lien.

However, all of these different roles and situations have different rules and procedures for filing a mechanics lien. It’s not a one-size-fits-all process, and understanding the nuances can be crucial in ensuring the lien is filed correctly and effectively.

How To File A Mechanic’s Lien

Step 1: Send A Preliminary 20-Day Notice

Before a mechanics lien can be filed, the first step is to serve a Notice of Right to Liens, often referred to as the Preliminary 20-Day Notice.

This notice must be served within 20 days of starting work or supplying materials to the project, whichever. If you miss the 20-day window, you can still serve the notice to recoup the costs of the project – but only money earned within the previous 20 days can be included in the lien.

That means if you only worked one day, but you let the 20-day window expire, you’re out of luck. If you worked, say, 5 days on a job, and you filed 21 days after the start, you’d only be entitled to 4 days of work – that first day’s wages are now unretrievable as you missed the 20-day window.

This step is crucial as it sets the stage for the filing of the lien and informs all parties involved of the potential claim. You should be filing this notice on every job, just to be safe. MAKE SURE that you file it before the 20-day deadline is up, as you will be unable to recoup any money spent after that time frame.

Step 2: File The Mechanic’s Lien

Once the Preliminary 20-Day Notice has been served, the next step is to file the mechanics lien. In many cases, you’ll never even have to do this, but everyone gets done over once by some unscrupulous construction “professional” at some point.

In California, you have 90 days from the last day you performed work or provided goods on the project to file your mechanics lien. This is different from the 20-day Notice, of course – which is a warning that you could file a lien if you’re not paid.

Now, you’re not being paid, and you have up to 3 months to file a mechanics lien to get repaid. If you let this time go by without filing a mechanics lien, the party that owes you money for your work and supplies is no longer legally liable to pay you.

Notice of Completion Or Cessation: 60 Days To File

One important exception to the 90-day window to file your mechanic’s lien for backpay or supplies is if the owner files a notice of completion or cessation, indicating the project has stopped.

In case of a filing of a notice of completion or cessation, you only have 60 days from the filing of that notice to file your lien. You will see this often on projects with tenuous funding or in times of upheaval. Make sure you’re paying attention to the people who owe you money, and get that mechanic’s lien filed ASAP.

Every day you wait is you potentially losing money you’re owed!

Step 3: The Chips Fall

Once a mechanics lien has been filed, then the pain begins. For the homeowner, at least.

Any homeowner who has a mechanics lien filed against them will have their property immediately impacted. In some cases, they may have their home foreclosed to recoup the payments. In other scenarios, a homeowner may be forced to pay twice the original amount.

At any rate, a homeowner with a lien against their home will have a very difficult time selling, refinancing, or doing many things that property owners need to do. Basically, a lien on someone’s home makes it extremely difficult to do anything substantial with that home – until the lien is cleared.

Once the homeowner completes the lien and pays the outstanding balance, the lien is quickly dropped and both the homeowner and the contractor can continue on with their lives. As you can imagine, this process is good for no one in the process – and ultimately it may feel like a Pyrrhic victory, having had to deal with months of back and forth and legal work.

The Importance Of Following Through

Even if you don’t plan to foreclose on the lien, it’s best to go through the entire procedure of filing a mechanics lien on every project. It’s important that you make the mechanics lien an essential part of your business, as it only serves to protect you and your company.

If payment discussions break down or your customer appears headed toward insolvency, your diligence will have made it possible for you to foreclose on the lien and retrieve any funds that you’ve invested. There really is absolutely no reason for you not to be on top of this, personally and with anyone working under you.

In the case of non-payment, if you don’t have a mechanics lien, things get A LOT more difficult if you want to get your money. Considering how easy the process is, there’s absolutely no excuse to not follow this entire process for every job you take on.

In any situation, whether you’re the homeowner or the contractor, it’s important to contact a legal professional to handle these complicated situations. A lawyer can be an invaluable resource when it comes to properly navigating the complex and labyrinthine American legal system.

The key takeaway from all of this is to do your diligence ahead of time – and you’ll always be prepared when the worst happens.

Additional Reading

CSLB – Preventing Mechanics Liens (great source of nitty-gritty information!)
CSLB – Understanding Mechanics Liens

What Jobs Can A General Contractor Do In California?

With over 100,000 license holders in California, Class B General Contractors make up the majority of construction professionals in the state.

As masters of the basics of construction, general contractors know the fundamentals of every aspect of building – and are responsible for making sure the project comes out the way it’s supposed to.

What Kind Of Jobs Can You Take As A General Contractor: A General Overview

In…general…a general contractor can do a wide variety of construction-related tasks, but usually related only to the fundamental and structural aspects of the building.

They’re allowed to take on structural tasks like framing or carpentry jobs, where that’s all they’re hired to do. Once it goes beyond that, they need to subcontract.

While general contractors can do framing and carpentry, they are restricted from doing additional work on their job sites, unless they have the necessary Class C license to perform the work. Jobs like plumbing and electrical are accessible only to those license holders.

In addition to these general rules, there’s also a patchwork of specific bylaws and regulations as to what types of jobs they can do additional work on, which jobs they can’t, what types of trades they can perform, how many, and so on.

What Does The CSLB Say?

When it comes to ensuring your work as a general contractor is legally compliant and totally above board, it’s important to always follow the CSLB codes and regulations to a T.

Here’s what the CSLB has to say when it comes to jobs Gen Cons can do:

“Business & Professions Code

Division 3, Chapter 9. Contractors, Article 4. Classifications 7057.

Except as provided in this section, a general building contractor is a contractor whose principal contracting business is in connection with any structure built, being built, or to be built, for the support, shelter, and enclosure of persons, animals, chattels, or movable property of any kind, requiring in its construction the use of at least two unrelated building trades or crafts, or to do or superintend the whole or any part thereof.

This does not include anyone who merely furnishes materials or supplies under Section 7045 without fabricating them into or consuming them in the performance of the work of the general building contractor.

(b) A general building contractor may take a prime contract or a subcontract for a framing or carpentry project. However, a general building contractor shall not take a prime contract for any project involving trades other than framing or carpentry unless the prime contract requires at least two unrelated building trades or crafts other than framing or carpentry, or unless the general building contractor holds the appropriate license classification or subcontracts with an appropriately licensed specialty contractor to perform the work. A general building contractor shall not take a subcontract involving trades other than framing or carpentry unless the subcontract requires at least two unrelated trades or crafts other than framing or carpentry, or unless the general building contractor holds the appropriate license classification. The general building contractor may not count framing or carpentry in calculating the two unrelated trades necessary in order for the general building contractor to be able to take a prime contract or subcontract for a project involving other trades.

(c) No general building contractor shall contract for any project that includes the “C-16” Fire Protection classification as provided for in Section 7026.12 or the “C-57” Well Drilling classification as provided for in Section 13750.5 of the Water Code, unless the general building contractor holds the specialty license, or subcontracts with the appropriately licensed specialty contractor.
(Amended by Stats. 1997, Chapter 812 (SB 857).”

So…What Types Of Jobs Can A General Contractor Perform?

Sometimes the CSLB can use language that makes your head spin. There’s a lot of legalese and specific, confusing language in there that can have general contractors wondering if they’re staying compliant. So what exactly are they saying here?

The long and short of it is, if you’re a general contractor, you can do framing and carpentry on any job that is framing or carpentry only. Any more than two trades, you gotta hire it out!

If you’re a general contractor with a Class C license, you can do any Class C work on your job.

Wrapping Up

If you’re a general contractor, chances are you’re probably not doing the work yourself. You’re already deeply familiar with your limitations and your expertise – and why get your hands dirty when you can just hire someone else to do the work for you?

When in doubt, though, follow these simple guidelines. General Contractors:

  • Can Perform Construction Work On Framing and Carpentry Jobs
    • General contractors can sign contracts and self-perform work that involves framing or carpentry projects.
    • There is an exception: you cannot do framing or carpentry work if the project involves two or more trades.
  • Can Engage In Licensed Trade Work
    • GCs can also engage in contracts for a single trade, but if they lack the necessary specialty classification for that trade, they are required to subcontract the work to a contractor with the appropriate classification.
    • This does not include carpentry or framing!
  • Can Undertake Multiple Unrelated Trades
    • A general contractor can enter contracts for two or more separate and unrelated trades and self-perform the work if they hold the correct license for each respective trade job.
    • Once again, framing and carpentry cannot be counted as one of the trades – they must be one of the other Class C Classifications!

Contractor Warranties: What California Contractors Need to Know

Implied, express, or contractual – warranties are a critical part of contract law that ALL California contractors need to know to be successful.

Sure, one can say “I’m a contractor and not a lawyer!” and while that’s true, it’s also essential that you understand the basics of a contract, to make sure you don’t get burned by sketchy subcontractors or ruthless clients – both of which want to get the most value for the least money.

With that in mind, let’s take a look at warranties for contractors – what they are, what they do, and why you need to know them to be successful as a California contractor.

What Is A Construction Warranty?

In California, a warranty is a legally enforceable assurance provided by a contractor to a client regarding the quality, functionality, and durability of the work delivered.

Warranties in the construction domain serve to uphold professional standards, protect consumer rights, and provide a framework for action and remuneration in case of construction defects or non-compliance with specified standards.

It serves as a pledge that the delivered project will adhere to the specified standards, and should any issues arise within a stipulated period post-completion, the contractor will rectify them at no additional cost to the client.

In legal terms, a warranty refers to a guarantee or promise enshrined within a contract, under which the contractor assures the quality, performance, or condition of a particular subject matter to the client. Warranties also stipulate the consequences of construction defects, legally outlining what a contractor must do in the case of a construction defect.

What Does A Construction Warranty Do?

Warranties, at their very basic level, are legal protections that protect both the contractor and the client by outlining all of the responsibilities of both parties – and the consequences for violating the terms both parties agreed upon.

  • Contractual Assurance: A warranty is a contractual assurance wherein the contractor guarantees the quality and compliance of the job. This could range from the materials used, the workmanship quality, to the project adhering to local building codes and regulations.
  • Binding Obligation: Once a warranty is stipulated within a contract, it becomes a binding obligation, enforceable in court. The contractor is now legally bound to honor the warranty, failing which could result in legal repercussions.
  • Remedial Action: The primary purpose of a warranty is to provide a remedial course of action in case the delivered work doesn’t meet the specified standards. Warranties exist to protect the client, by outlining the specific steps a contractor must take to fix a contractual violation.
  • Risk Allocation: On the flip side, warranties also protect contractors by defining the extent to which contractors are liable for defects or issues arising post-construction.

Types of Construction Warranties

  • Express Warranty: This is a clearly articulated assurance provided by the contractor regarding specific aspects of the construction project. This is essentially any warranty or guarantee a contractor puts in a contract. It specifically and granularly outlines the things they promise to deliver to the client and the timeframe they’ll fix any problems that crop up.
  • Implied Warranty: Unlike express warranties, implied warranties are not explicitly stated but are implied in the very nature of construction. By taking on any construction job, a contractor is tacitly agreeing to these warranties. There are two types of implied warranties in the United States.
    • Workmanship Warranty: guarantees that any construction project will be built in a good or workmanlike manner, free of major defects. This includes both labor and materials.
    • Warranty of Habitability: guarantees that any construction project will be suitable for the purpose they are intended for and be safe to live in.
  • Statutory Warranty: These are warranties determined by the state. Statutory warranties do one thing: they specifically outline the amount of time that contractors are liable for any construction defects.

Common Construction Warranties In California

Warranties in California cover a spectrum of durations and construction aspects, and they can vary from industry to industry and home to home. Here’s some of the main ones you’ll come across in your career as a California contractor.

General Warranties

  • Mandatory Warranties: Contractors in California are obligated to provide warranties on their work, such as a 4-year warranty on installed items, a one-year warranty on the fit and finish of certain areas, and a guarantee against defects in compliance with building codes and manufacturer requirements​.
  • State Law: Notable legal codes include California Civil Code 900, which requires one-year expressed limited warranties for both new construction and remodeling projects, and the Right to Repair Act (California Civil Code 896, et seq.), which includes implied warranties into the one-year warranty requirement.
  • One-Year Warranties: These short-term warranties cover aspects like “fit and finish” of certain elements, “manufactured products,” compliance with “interunit noise transmission standards,” and irrigation, drainage, and landscaping systems​.
  • Two to Five-Year Warranties: These cover medium-sized problems, like untreated wood posts, dryer ducts, plumbing, sewer, electrical systems, exterior pathways, and paint and stains causing deterioration​.
  • Ten-Year Warranties: Ten-year warranties are all about foundational and structural elements. Ten-year warranties ensure long-term accountability on the construction elements most critical to human safety.

Notable Court Cases Involving Warranties

When it comes to contractor contracts, looking to existing court cases is a good way to learn about the system, so you can prepare yourself for even the worst-case scenario.

1. Moore v. Teed

Moore v. Teed was an interesting case about contractual fraud and construction defects, with a big emphasis on the legal application of Business and Professions Code §7160. In the case, a homeowner was suing a contractor for damages because the contractor severely overpromised… and underdelivered to the tune of $300,000.

This ruling gives homeowners more leverage over contractors who promise the world and don’t deliver. In the case, the court ruled that homeowners are entitled to the “image that the contractor promised” when selling their services. In other words, a contractor is liable for the promise of the project made by the contractor and is due damages equal to the promise made to the client – whether it’s in writing or not.

2. Howard Contracting, Inc. v. G.A. Macdonald Construction Co., Inc.

This landmark case made it to the California Supreme Court and set a precedent that allows subcontractors to recover damages for cost overruns caused by delays and disruptions – even if there’s stipulations in the prime contract barring such claims.

The civil ruling changed things for both subcontractors and contractors in California by giving subcontractors the option to sue for – and receive – damages for any out-of-pocket costs or expense overruns caused by delays. The key thing is that even if the prime contract states the prime contractor isn’t liable for damages, they are still liable for damages.

3. Aas v. Superior Court Of California

In this massive 2000 ruling, the California Supreme Court delineated the boundaries of negligence claims in construction defects scenarios. The court ruled that homeowners could not recover damages for construction defects that hadn’t caused property damage. It seems obvious, but before then, there was no legal precedent protecting contractors against

This ruling set a significant precedent on the scope of liability for contractors and developers, finally establishing precedent that homeowners can’t sue contractors for damages related to construction defects…. without actually suffering damages related to construction defects.

It’s wild that we even have to type that…but here we are. Thanks to this court ruling, contractors and the state of California must have saved millions in legal fees from baseless lawsuits.

California Contractors: Get To Know Your Contracts!

As you can see from these court cases, it’s critical for any contractor to know what’s in their contracts – and what’s excluded from them. Any contractor who is too lazy to learn at least the basics of contract law is a contractor who will find themselves in trouble at some point down the road.

We hope this guide serves as a good jumping-off point for your contracting business – now’s the time for you to dig deeper into your own personal situation to make sure you’re covering all your bases and setting yourself up for success as a California contractor.

Additional Reading

California State Licensing Board
Levelset – Warranty requirements for contractors in California​
Esquire REB – New Construction Warranties Provided By California Law​
Valley Contractors Exchange – New Construction Warranties
Stone Sallus – Construction Defect Claims in California: Understanding Your Options​
FreeAdvice – California Contractor Warranty Form
Smith Currie – New California Construction Laws for 2023

How To Go From A Construction Manager To A Licensed Engineer

Construction management is a difficult, demanding profession – it involves long days at the job site in every weather imaginable, putting out fires from sun-up to sun-down (and often all the time in between!).

If you’re a construction manager yourself, you may be thinking: why not just become an engineer? In many cases, you already have 90% of the skills of an engineer; you just lack the mathematical education and skills and the licensing requirements to become an engineer – and enjoy the quality-of-life perks that come with it.

But becoming an engineer as a construction manager isn’t the most straightforward or easy path. It requires years of hard work and planning to fulfill that dream – but it’s not impossible! With that in mind, here’s our guide to the easiest way to become an engineer as a construction manager!

Understanding the Roles: Construction Manager vs. Engineer

Before diving into the transition process, it’s essential to understand the distinct roles of a construction manager and an engineer.

  • Construction Manager: Primarily responsible for overseeing the day-to-day operations of a construction site, ensuring that projects are completed on time, within budget, and adhering to set standards. Their education typically includes a degree in construction management, civil engineering, or construction science.
  • Engineer: These professionals design the initial planning and blueprints for construction projects and ensure that their directions are followed throughout the project by regularly communicating with construction managers and other stakeholders. Engineers usually work from an offsite main office, overseeing the broader aspects of planning a construction project1. Depending on the complexity of the project, engineers may have a smaller part of the process as the project progresses.

Practical Steps to Transition

Okay, so how do you transition into an engineering career as a construction manager? Well, get ready to go back to school, as you need to get a degree in engineering to get started! You need a bachelor’s degree to get any real job as an engineer on a construction project. This is obviously for safety reasons – engineers are responsible for ensuring the physical safety of their buildings.

A bachelor’s degree in engineering provides you with the comprehensive knowledge needed to operate as an engineer in the real world – ensuring construction projects are safe and within the boundaries of physical law. You learn everything from math to design – all critical skills for engineers.

  • Earn a Relevant Bachelor’s Degree: The first step to becoming a civil engineer is to earn a bachelor’s degree from a program that offers a construction engineering program. A good engineering program typically has accreditation from the Engineering Accreditation Commission of the Accreditation Board for Engineering and Technology (ABET).
  • Get A License: To practice as an engineer, you don’t technically need a license, but in reality, you do. If you’re a civil engineer, you must obtain a Professional Engineer (PE) license. Μuch like getting any other CSLB license, this includes four years of experience operating as a “journeyman” engineer under a licensed engineer. In addition to licenses for civil engineers, most states require specific licenses. All of these routes require you to pass engineering exams as well. The steps to licensing are:

In many cases, you have to apply for and receive a state license from your state. There may even be state and local requirements as well.

Skills Needed for Engineers

Transitioning to an engineering role requires a blend of technical and soft skills. Luckily, if you’re a construction manager, you have all the necessary soft skills needed, in addition to knowing the ins and outs of construction – something that gives you a huge advantage in understanding and communicating logistical realities to clients and higher-ups.

The key difference in skills needed is your engineering skills – the knowledge and understanding of the mathematics and physics needed to construct a building that is safe and fit for humans, meets local codes and bylaws, and may even need to be sustainably developed.

  • Total understanding and control of physics such as dynamics, mechanics, tension and more.
  • Strong mathematical skills such as calculus and geometry, with the ability to apply them.
  • Design skills such as blueprinting, conceiving, and sketching.
  • Proficiency with design and visualization programs like AutoCAD and TileFlow.
  • Programming skills to get maximum value from design tools such as SolidWorks and AutoCAD. In the electrical and mechanical engineering fields, specialized programming languages such as MATLAB and RAPID are often used.
  • Specialized construction knowledge of common high-use projects like roads, tunnels, bridges, and so on.
  • Ability to accurately estimate cost and communicate trade-offs when it comes to materials and design.
  • Knowledge of sustainable and energy-efficient materials and their properties with regard to construction.
  • Ability to effectively communicate the project to stakeholders.
  • A consistent ability to problem-solve real-world problems posed by the physical and material challenges of production.

Similarities and Differences Between Construction Managers and Engineers

Similarities

  • Both roles are the backbone of the construction process. Without either of them, no building gets built.
  • Both demand a profound understanding of construction principles and practices, on both a macro- and micro-scopic level.
  • Effective and consistent communication is the key in both roles, especially when coordinating with other professionals and stakeholders.

Differences

  • Engineers have more stringent education and licensing prerequisites, with a stronger emphasis on the mathematics and physics of construction.
  • Engineers are involved early on in planning and design, well before anything is touched on a job site. Construction managers take the plan and make it happen – they are the day-to-day torchbearers on a job site.
  • Engineers are generally much more mathematical and “brainy” than construction managers, and their work is much less ambiguous than construction managers. CMs are constantly working with the human side and the day-to-day work, which means they’re doing less math and less time in an office chair.
  • Engineers may never step foot on a job site, often working from the comfort of an office. Construction managers are pretty much on the site from the beginning of the project all the way to the bitter end.

Engineering vs. Construction Management Salaries and Economic Impact

It may surprise you that, in general, it is more lucrative to be a construction manager than an engineer!

As of May 2022, the median annual wage for construction managers was $101,480. The employment of construction managers is projected to grow by 5% from 2022 to 2032, which is faster than the average growth rate for all occupations. This indicates approximately 38,700 job openings for construction managers each year over the decade.

On the flip side, civil engineers (the best representation of this diverse career) had a median annual wage of $89,940 in May 2022. The employment landscape for civil engineers is projected to burgeon by 5% from 2022 to 2032. This signifies about 21,200 openings for civil engineers each year, on average, over the decade.

However, it’s important to keep in mind that financial compensation is only one piece of the puzzle when deciding one’s career. A construction manager is often in the trenches with their team, dealing with rain, snow, wind, and all sorts of weather conditions, at all hours of the day, often working long days to make sure everything runs smoothly.

Engineers, on the other hand, are generally white-collar jobs. Engineers generally work regular hours from the comfort of an air-conditioned office. With a difference of ~$10k, it makes sense for a lot of seasoned CMs to want to change to something that’s a little less demanding. You may be one of these people!

Transitioning to a Licensed Engineer in California: The Golden State’s Path

As always, let’s take a look at the process for construction managers in California looking to change course and become an engineer in the Oldie Goldie State.

Steps to Become a Licensed Engineer in California:

Pre-Application Requirements:

  • Before applying for licensure, ensure you’ve passed the NCEES Fundamentals of Engineering (FE) exam and the Principles and Practice of Engineering (PE-Civil) exam.
  • Confirm that you meet the qualifying experience requirements set by the state.

FOR CIVIL ENGINEERS ONLY – APPLY TO BPELSG

  • Once you’ve passed the necessary exams and have the required experience, submit your application for licensure to the California Board of Professional Engineers, Land Surveyors, and Geologists using the online BPELSG Connect portal.
  • California requires additional state-specific exams: Civil Seismic Principles and Civil Engineering Surveying.
  • These exams are offered on a continuous quarterly basis, and there’s no final filing date.

Get Your CSLB License

  • Now you need to apply for your CSLB Class A General Engineering Contractor License!
  • As always, you have to meet the CSLB’s licensing requirements before applying.
  • Then, you just have to pass the CSLB exam and get the necessary bonds and insurance
    Receive Your License And Start Working!

Once you’ve passed the CSLB exam, you can start working as an engineer right away!

Additional Information:

  • For Civil Engineers – Three Types Of BPELSG Licenses: BPELSG California offers three categories of licensing for engineers:
      • Practice act (Civil, Electrical, and Mechanical Engineering)
      • Title act (Agricultural, Chemical, Control Systems, Fire Protection, Industrial, Metallurgical, Nuclear, Petroleum, and Traffic Engineering)
      • Title authority (sub-branches of Civil Engineering: Structural Engineering and Geotechnical Engineering).
  • Eligibility and Experience Requirements: Applicants must meet the qualifying experience requirements outlined in Business and Professions Code sections 6751(c) and 6753 and Title 16, California Code of Regulations section 424.
  • Background Check and Fingerprinting: All applicants are background checked and fingerprinted by the CSLB before they are given a license. Check out our comprehensive article on that topic for more information.

Should I Become An Engineer As A Construction Manager?

The answer to that question can only lie within. The reality is that construction managers do make a bit more money, but the trade-offs of having set, reliable hours, and working off-site (or even from home!) means that it could be absolutely worth it for you and your family to make the transition to engineering.

If you’re looking to become an engineer in California, we’ve got you covered with everything you could need to know about what it takes to become a CSLB-certified construction engineer in our great state.

Can a Residential Contractor Work on Commercial Jobs in California?

If you’re a general contractor working on homes, apartments or other residential spaces, you might wonder if you are legally able to work on commercial jobs, even if you’ve only worked on residential jobs before.

In this article, we’ll cover everything you need to know if you’re a residential contractor looking to make the jump to the bigger, higher-paying commercial jobs in your part of California.

Key Differences Between Residential and Commercial Contractors

The obvious difference between commercial and residential contractors is that one builds residences like homes and apartments, while the other works on commercial properties: offices, data centers, strip malls, and so on.

Both groups tend to stay in their own respective lanes, but there is a fair bit of overlap as well. Here are the main differences (and similarities) between residential and commercial contractors.

1. Scope and Scale of Projects

  • Residential Contractors: Build homes, apartments, and other living spaces. The projects are typically smaller in scale and involve a more personalized approach to meet the homeowner’s needs. They require a fair bit of direct customer interaction – more so than commercial contractors.
  • Commercial Contractors: They construct non-residential buildings like offices, malls, and industrial structures. These projects are almost always larger, involving more complex systems and more stringent regulations than residential jobs.

2. Building Codes and Regulations

Residential Contractors: Adhere to residential building codes, which might be more lenient in aspects like accessibility and materials. Basically, if you’re building a safe and habitable home or apartment that fits the neighborhood, residential contractors have little to be concerned about when it comes to codes and regulations.
Commercial Contractors: Must comply with commercial building codes, which have stricter guidelines concerning safety, accessibility, and durability due to the public nature of the spaces and the sheer amount of people who use commercial spaces.

3. Design and Materials

Residential Contractors: The design often prioritizes aesthetics, comfort, and functionality, with a lot more flexibility and openness to unique designs. Materials used might prioritize cost-effectiveness or visual appeal. There’s a lot more freedom here.
Commercial Contractors: The design must cater to the functionality of the business or industry, often involving the use of more durable and industrial-grade materials to withstand higher traffic and usage.

4. Project Timeline and Budget

Residential Contractors: Residential projects almost always have a shorter timeline and might have a more flexible budget, with a focus on meeting the homeowner’s specific needs and preferences.
Commercial Contractors: Projects often come with a stringent timeline and budget, with a higher emphasis on adhering to the predetermined schedule to prevent financial losses. Commercial contractors have a lot more on their shoulders than residential contractors, with dozens or hundreds of stakeholders pushing hard on the project to meet expectations and deadlines.

5. Licensing and Insurance

Residential Contractors: Licensing requirements might be less stringent, and insurance might focus more on aspects like property damage and injury. However, in most states, residential contractors have strict licensing guidelines.
Commercial Contractors: While all residential contractors are required to have licenses and insurance in California, commercial contractors are often required to have even more comprehensive licenses and insurance policies due to the larger scale and higher risks involved in commercial projects.

6. Client Interaction

Residential Contractors: Interaction is often with individuals or families, requiring a personal touch and understanding of individual needs. This can sometimes mean overly demanding or needy clients when compared to the residential world, where the general contractor is communicating with an intermediary.
Commercial Contractors: Interaction is usually with business entities, requiring a focus on meeting the functional needs of the business and adhering to commercial standards and regulations. Generally, they have less need for shmoozing or working hard to win clients over.

Licensing: The Key Area

In California, the key license required for general contractors looking to work on both residential and commercial projects is the Class B General Contractor License. Both sets of general contractors need this license to do any work in California. This license is designed for individuals specializing in both residential and commercial construction tasks.

The scope of work under this license is broad as you might expect, covering all sorts of general contractor responsibilities. Some of the things that the Class B General Contractor license encompasses:

  • Design & Builds
  • Residential and commercial building construction
  • ADU Builds
  • Tenant Improvements
  • Repairs and fixes
  • Remodeling (in some instances – in others you’ll need a class B-2 license)

It’s extremely important to note that without a Class B license, you cannot do any general contracting work at all – residential or commercial, so you’re going to want to take care of that first.

The Fine Print

However, the General B License comes with its set of caveats. A general building contractor may engage in a project involving framing or carpentry directly. But for projects involving other trades – in California, anyone holding a Class C License – the scenario gets a tad complex.

Here’s the deal:

If a project involves trades beyond framing or carpentry, a general building contractor can take a prime contract only if it necessitates “at least two unrelated building trades or crafts”.
Alternatively, the contractor should hold the appropriate license classification or subcontract with an appropriately licensed specialty contractor to perform the work.

The Legal and Regulatory Rundown

There are a bunch of legal and regulatory guidelines that govern commercial and residential contracts. The main thing to be aware of – as always – is licensing. Generally speaking, license laws are the laws that will govern everything when it comes to residential and commercial general contracting.

A Class B General Contractor License, for example, allows GenCons to take on any general contracting job in the state – including residential or commercial – but many jobs require contractors to acquire further licensing or certifications to perform certain types of work.

The B&P Code §7057, for example, places further limitations on the types of work GenCons can take on, stating that general building contractors cannot engage in certain works unless they add specific classifications to their license or subcontract with a specially licensed contractor.

As always – it’s illegal for unlicensed contractors to work on any construction project valued over $500, and a license is mandated for 40 construction-related trades in California.

Here’s some more specific information.

Commercial Construction Contracts

One of the biggest laws affecting general contractors working in residential and commercial jobs is SB 474, signed back in 2011. This law established the following changes:

  • SB 474 broadened the scope of unenforceable indemnity provisions, particularly the “Type I” indemnity provisions which previously allowed an upstream contractor to be indemnified by a downstream contractor even for liabilities arising from the former’s own active negligence.
  • Imposed stricter limitations on contractors’ ability to require their subcontractors and suppliers to cover the costs of defense in litigation. Specifically, the law added requirements for a formal written tender of the claim before a subcontractor is obligated to contribute to defense costs.

Carpentry & Framing Restrictions

General contractors in California have specific restrictions when engaging in projects outside the domains of framing or carpentry on their jobs. This gets a bit sticky, so we’ll cover this more in-depth in a later article, but here’s a bird’s eye view of how carpentry and framing trades affect residential and commercial general contractors.

  • A general contractor may take a prime contract or a subcontract for a framing or carpentry project.
  • For projects involving trades other than framing or carpentry, a GenCon can only take a prime contract if it requires at least two unrelated building trades or crafts.
  • Similarly, a GC can take a subcontract involving other trades only if it involves at least two unrelated trades or crafts, aside from framing or carpentry.
  • Furthermore, the law restricts general contractors from contracting for projects that include any CSLB Class “C” specialty contractor projects, unless they hold that certification themselves. Even then, they cannot perform the work if there are less than two trades involved. There must be at least two trades involved.

In addition, to these overarching laws, there’s been a number of recent bills and other legislation that dictate the finer points of commercial general contracting. Here are some of the most important ones for contractors to know.

2022 General Contractor Laws

Electronic Records for Contractors and Subcontractors (AB 1023):

  • This regulation was introduced to enable electronic record-keeping, making it easier for contractors and subcontractors to maintain and access their records digitally.

Direct Contractor Liability on Private Works (SB 727):

  • This legislation expands the liability of direct contractors on private works projects. It requires direct contractors to make certain payments and extends their liability, ensuring that subcontractors and laborers are paid appropriately for their work​​.

Property Assessed Clean Energy (PACE) Program (AB 1551):

  • This law concerns the PACE program which provides financing for homeowners and business owners to make energy efficiency, renewable energy, and water conservation improvements.

Enforcement of Liens on Real Property (SB 572):

  • This regulation addresses the enforcement of liens on real property, providing a legal framework for contractors and other stakeholders to claim their financial rights.

Change Order Cap (Los Angeles County ONLY!):

  • A law was enacted that allows Los Angeles County to implement a change order cap of $400,000 for contracts whose original cost exceeds $25,000,000, and a cap of $750,000 for contracts exceeding $50,000,000. These caps are adjustable annually based on the percentage change in the California Consumer Price Index​.

2023 General Contractor Laws

Workers’ Compensation Laws

  • Probably the biggest piece of legislation that went into effect in 2023 are the new Workers’ Comp laws. These laws legally require all contractors to have $25,000 in Workers’ Compensation.

Housing Affordability and Environmental Laws

  • A series of laws were passed aimed at improving housing affordability, tackling climate change, and facilitating the construction of new housing, impacting both residential and commercial contractors. This is an opportunity for general contractors to reach new markets

Procurement Authorities

  • New procurement authorities were introduced for contractors, potentially altering the way contracts are awarded and managed.

Accessory Dwelling Units (ADUs) Laws

  • New laws concerning ADUs were passed to make it easier and more affordable to build such units, impacting residential contractors primarily but also commercial contractors involved in residential projects.

Minimum Wage Increase

  • Effective January 1, 2023, the minimum wage in California will increase to $15.50 per hour for businesses with 26 or more employees, affecting the labor costs for contractors.

Increased Civil Penalties (AB 1747):

  • Contractors who violate building laws will see an increase in civil penalties under AB 1747 in 2023. The bill increases the fine from $8,000 to $30,000 for every violation of BPC Section 7110 (violations of building laws) and amends Section 7099.2 (assessment of civil penalties) regarding building permit violations​.

Conclusion

If you’re a residential contractor in California – good news! You don’t need anything special to do commercial jobs, as long as you’re working on jobs that fit your classification, and making sure that you’re paying attention to all the exceptions to the rules – things like specialized classifications and the “two trade” laws.

Marketing yourself as a commercial contractor is a whole different kettle of fish, though – maybe we’ll write an article with some of the best tips to get you going!

References

CSLB – Building Official Information Guide
CSLB – Class B General Contractor License
Smith, Currie & Hancock – 2023 Construction Laws
Digital Constructive – Jobs You Can Do With A General B License
Contractors License Guru – What Can and What Can’t General Building Contractors Do
LegalMatch – Can Homeowners Hire an Unlicensed Contractor?
Lorman – Fundamentals of Construction Contracts in California
Pillsbury Law – Shifting of Liability

How to Market to Your Local Area as a California Contractor

As a California contractor, one of the hardest parts of being a contractor is growing your business.

While some contractors are lucky enough to work a number of jobs across different zip codes and geographies, the reality is that the majority of the contractors in the state work in the same area for their entire careers.

With this in mind, it’s absolutely essential for any contractor looking to build success to have a strong local presence. People in your neighborhood need to know who you are and what you do before they can even think about hiring you.

So how do you reach your local market? What are the best ways for California contractors to get their name out there – and ultimately to win more business? Here’s how.

Define and Understand Your Local Market

Before you can market to your local area, you need to understand it, as well as how your skills, or license fits into your local area’s needs. For example, if you’re a C-57 Well Drilling contractor, you might not find much work in Santa Monica.

Here are some easy ways to define your market:

  • Demographics: Who are the people in your local area? What is their age range, income level, and housing situation? What types of properties are in your area, and which ones need contractors in your discipline?
  • Needs: What are the common construction needs in your area? Are there more demands for home renovations or new constructions?
  • Competition: Who are your local competitors? What services do they offer, and how can you differentiate yourself? A quick Google search can provide you with a list of local contractors. Analyze their services, pricing, and customer reviews to identify gaps that your business can fill.
  • Networking: Attend industry events, stay up to date with your union meetups, and join professional organizations both locally, regionally and nationally. This not only helps you stay updated with the latest trends but also provides opportunities for networking and collaboration between contracting disciplines. If someone needs a roofer, they’re going to call the roofer they know.

Person-To-Person Contact

Once you’ve understood your local market, the next step is to build a strong local presence. The best way to achieve growth, just like networking, is by face-to-face, in-person connection.

Especially when it comes to something as expensive and important as construction, people want to hire people they trust. Here are some specific ways you can do that.

  • Community Involvement: Participate in local events and sponsor local teams or charities. This not only increases your visibility but also builds your reputation as a community-focused business. People trust people who are invested in their own community and success – so put your money where your mouth is.
  • Local Partnerships: Partner with local businesses to offer joint promotions or discounts. This can help you reach a wider audience and increase your customer base. For instance, partnering with a local home improvement store or joining forces with other contractors in the area to offer discounts is a great way to net new customers.
  • Angie’s List: Angie’s List is a great way to build your local network, as many people use it to find contractors in their area. Sure, this isn’t a direct, in-person way, but usually, if you book a job on Angie’s List, and deliver well, you’ll get hired again.
  • Referral Programs: One of the best ways to grow your business locally is via a referral program. Offer incentives like discounts or free services to motivate satisfied customers to refer you to friends. Referential power is the best way to grow your business – Nielsen underlines that 92% of people trust referrals from people they know.

Digital Marketing Is Essential

In today’s digital age, online marketing is a powerful tool for reaching your local audience. Here are some strategies to consider:

  • Social Media: You need to be using social media if you want to market yourself effectively – not even contractors are exempt from this. Share updates about your projects, offer home improvement tips, and respond to comments and messages – this will help you stay top of mind for your local customers. And don’t underestimate a good, old-fashioned Facebook group for your local community – it’s a great way to connect with people in your area.
  • Online Advertising: Use platforms like Google Ads and Facebook Ads to reach a wider audience. You can target your ads based on location, demographics, and interests to ensure your ads stay relevant to the people you’re trying to reach.
  • Email Marketing: Along those lines, sending regular newsletters to your subscribers, offering updates, promotions, or useful content can keep you top of mind. According to a study by Campaign Monitor, email marketing has an ROI of $44 for every $1 spent.
  • Local SEO: Optimize your website for local search. This includes using location-specific keywords, such as “California contractor,” and ensuring your business is listed in local directories and on Google Business, so people can find you when they search for you. According to a study by BrightLocal, 93% of consumers used the internet to find a local business in the last year – underlining how important this is to local marketing.
  • Content Marketing: Create valuable content related to home construction and renovation and post it on your own website. This not only positions you as an expert for anyone looking at your services but also increases visibility by improving your website’s SEO. You can even go as far as creating video or photo content for TikTok or Instagram.

Track Your Efforts And Iterate

At the end of the day, you have no idea how your efforts are going if you don’t track your data and record the results of your marketing efforts.

Use tools like Google Analytics to monitor your website traffic, social media insights to track engagement, and customer feedback – in the form of customer surveys after a completed job – to gauge satisfaction. According to a report by HubSpot, companies that track their inbound marketing see a 12% increase in conversion rates, really underlining the importance of seeing how your work is doing.

Even if it looks like your marketing efforts aren’t working at all, stay patient. In many cases, it takes a long time for prospective customers to become real customers, up to months or even years in some cases, especially as contractors.

And if you think something isn’t working, you can always iterate upon it. Sometimes it’s as simple as the image you are using for your ad or the subject line of your email. Iteration is a great way to quickly and easily improve your marketing.

A Comprehensive Guide To ADU Builds For California Contractors

Accessory Dwelling Units (ADUs) have emerged as a huge economic opportunity for both homeowners and contractors alike. The ADU market in California has experienced unprecedented growth, evidenced by a 50% increase in permit applications in 2022 compared to the preceding year. There’s a reason why – it represents a huge opportunity for both contractors and homeowners alike.

With bill after bill of pro-ADU legislation coming through the California legislature, the state is definitely making it easy for people to offer ADUs on residential property. If you’re a builder looking to take advantage of this new market or a person looking to make a little bit of extra cash, an ADU looks like an enticing opportunity. But make no mistake – building an ADU is no joke. It requires a lot of work, a lot of money, and a lot of regulatory legwork.

If you’re someone looking to build an ADU, either for yourself or your client – this guide will cover everything you need to know about ADUs and what it means to actually build one or enter the market as a specialty ADU contractor.

A Closer Look at the Historical Evolution

The trajectory of ADUs in California is marked by significant legislative milestones, each contributing to easing housing shortages. The introduction of Senate Bill 1069 in 2017 was a game-changer, relaxing parking and utility fee requirements and thereby catalyzing ADU developments.

Assembly Bill 68 in 2021 further expedited the approval process and allowed for multiple ADUs on single-family lots, setting the stage for a thriving ADU market with contractors steering this transformative shift

Navigating the intricate regulatory framework is paramount for contractors. The California Department of Housing and Community Development (HCD) outlines comprehensive guidelines encompassing zoning, size, and design, with local jurisdictions adding another layer of specificity. Contractors must meticulously consider:

  • Zoning Requirements: Adherence to varying local zoning ordinances is crucial, dictating the permissible locations for ADU construction and often adding to the cost.
  • Size Limitations: With a typical cap at 1,200 square feet, size regulations demand careful attention, considering the lot size and local variations.
  • Local Design Standards: Compliance with local design standards ensures that ADUs stay within local building codes like heights and lawn care.

Innovations and Trends: Crafting the ADU of Tomorrow

Innovation is at the heart of ADU construction, with contractors employing advanced technologies and sustainable methodologies to meet the evolving market expectations. Emerging trends include:

  • Sustainable Building Practices: The incorporation of features like solar panels, rainwater harvesting systems, and energy-efficient appliances is becoming the norm, reflecting California’s sustainability goals.
  • Modular Construction: The rising popularity of modular construction offers a blend of cost efficiency and time-saving benefits.
  • Smart Home Integration: The integration of smart home technologies enhances the appeal and functionality of ADUs, aligning with modern living expectations.

Statistics About the ADU Market in California in 2023

The ADU market in California in 2023 has witnessed significant developments, reflecting the evolving legal and economic landscape. Here are five noteworthy statistics:

  • Permit Applications: There has been a 60% increase in ADU permit applications in California in 2023 compared to the previous year, indicating heightened interest and activity in the ADU market.
  • Construction Costs: The average construction cost of an ADU in California is approximately $200,000, varying based on size, design, and location.
  • Rental Rates: Rental rates for ADUs in California have seen an average increase of 8%, making them a lucrative investment for homeowners.
  • Sustainability Trends: Approximately 70% of new ADUs constructed in 2023 have incorporated sustainable building practices, reflecting the growing emphasis on eco-friendly living.
  • Financing Options: The availability of ADU-specific financing options has increased by 25%, providing homeowners with more avenues to fund ADU construction.

Best Tips for Contractors Who Want to Enter the ADU Market

Establishing yourself in the piping-hot ADU market in California presents a golden opportunity for contractors. While every contractor’s situation is different, here are some general tips that will put you in the right direction when it comes to ADUs.

  • Stay Informed on Regulations: Regularly update knowledge on state and local ADU regulations to ensure compliance and stay ahead of any legislative changes.
  • Specialize in Sustainable Practices: Embrace and specialize in sustainable building practices to meet the growing demand for eco-friendly ADUs.
  • Build Relationships with Local Authorities: Foster relationships with local planning and zoning authorities to facilitate smoother permit applications and approvals.
  • Offer Customized Solutions: Provide tailored ADU designs and solutions to cater to the diverse needs and preferences of homeowners.
  • Engage in Community Outreach: Actively engage with communities to address concerns, build trust, and establish a positive reputation in the ADU market.
  • Budgeting and Financing: Providing accurate cost estimates and assisting homeowners in navigating financing options, such as ADU-specific loans and grants, is essential.
  • Site Assessment: Comprehensive site assessments identify potential challenges related to topography and utility access, enabling preemptive solutions.

Pros and Cons of Hiring a Contractor to Build Your ADU

As a homeowner, deciding whether to hire a contractor for your ADU build is probably the most important step you’ll make when building an ADU, because, obviously, you’re going to be the one building it if you don’t hire someone to build it!

Obviously, we think that most people would benefit from having a contractor build your ADU, but here are some pros and cons of bringing on an expert to take care of the building of your ADU property.

Pros

  • Expertise and Experience: Contractors bring a wealth of experience and expertise in construction, ensuring that the ADU is built to high standards and complies with all applicable regulations.
  • Streamlined Permitting Process: Navigating the permitting process can be challenging. Contractors are familiar with local ordinances and can streamline the application and approval process, saving homeowners time and hassle.
  • Quality Assurance: Hiring a contractor provides quality assurance, as they are accountable for the workmanship and must adhere to industry standards, reducing the risk of construction errors and subsequent costs.
  • Time Efficiency: Contractors manage the construction timeline efficiently, coordinating with subcontractors and suppliers, which can expedite the building process compared to a DIY approach.
  • Less Stress: Building an ADU can be stressful. Having a contractor manage the project alleviates the burden on homeowners, providing peace of mind throughout the construction journey.

Cons

  • Cost Implications: Hiring a contractor can be more expensive than a DIY approach due to labor and management costs. Homeowners need to weigh this against the potential costs of mistakes and delays if they were to manage the project themselves.
  • Less Personal Control: While contractors consult with homeowners, there may be less personal control over every detail of the construction process, which might be a drawback for those who prefer a hands-on approach.
  • Potential Communication Gaps: Homeowners may experience communication gaps or misunderstandings with the contractor, which can affect the project’s outcome. Clear and consistent communication is essential to mitigate this risk.
  • Finding the Right Fit: Identifying a reliable and qualified contractor can be time-consuming. Homeowners need to conduct thorough research, check references, and obtain multiple quotes to find the right fit for their project.
  • Contractual Disputes: There is a risk of disputes arising over contractual agreements, such as costs, timelines, or work scope. A well-drafted contract and open communication can help prevent and resolve any issues.

The Final Word

If you’re a contractor looking to get into ADUs, now is the time. The longer you wait to become a trusted ADU contractor in your area, the more competition there will be when you finally take the plunge.

The good thing is you don’t need a specific CSLB license to build an ADU – at the very least, you only need a Class B license, or, if you’re a homeowner modifying your own property, and the materials cost less than $600, you can build your own ADU. We have to be honest, though, that’s unlikely unless you’re just installing a new shelf or something. Considering the average cost of an ADU is $200,000, that’s highly unlikely.

Additional Reading

LA Times – Deep Dive on ADUs
California Legislative Information – Senate Bill 1069
California Legislative Information – Assembly Bill 68
California Department of Housing and Community Development – ADU Handbook
Terner Center for Housing Innovation at UC Berkeley – The State of ADUs in California
California Contractors State License Board – Owner-Builder Responsibilities
California Department of Housing and Community Development – ADU Construction and Financing
California Housing Partnership – ADU Market Trends and Statistics
U.S. Green Building Council – Sustainable ADU Construction in California

Business Structures 101 for California Contractors

You’ve put in the hard hours, you’ve done the hard work, and you’ve finally passed the notorious CSLB exam. Now’s the time to submit your bonds and insurance to the CSLB and get your contractor’s license.

Not so fast. There’s one thing that many contractors overlook – every contractor needs to establish a company for themselves, whether they’re a day jobber working on roofs in their neighborhood, or a multinational company beginning work in California for the first time.

But what kind of business should you establish for your contracting business? How do you even decide? In this article, we’ll cover some of the essentials when it comes to deciding what kind of business structure you should establish for your contracting company.

The California Secretary of State and the CSLB

The authority that regulates business in California is called the Secretary of State, but the CSLB – as always – is the one who requires all contractors to register as a business in the state.

It’s important to note that while technically speaking you do not need to have a business or to be registered with the California SoS, it’s all but necessary for contractors to have their own business. Without a proper business structure and registration, you expose yourself to financial risk, liability risk, to reputational risk in case anything goes wrong.

Registering a Business: A Prerequisite for CSLB Licensing

Before you can apply for a contractor’s license from the CSLB, you must first register your business with the state of California. This is a critical step in the licensing process. The type of business structure you choose will determine the specific registration process you must follow – more on that later.

Once your business is registered, you can then proceed to apply for a contractor’s license from the CSLB. The application process involves demonstrating your qualifying experience, passing an examination, and getting fingerprinted for a criminal background check.

Remember, operating a contracting business without a valid license from the CSLB is illegal in California and can result in hefty penalties. Therefore, it’s crucial to ensure your business is properly registered and licensed before you start offering contracting services.

Sole Proprietorship: Simplicity with Personal Liability

For 99% of contractors, you’ll want to set up as a sole proprietorship.

In its simplest form, this means you are the only operator and only employee in the business. As you can imagine, this is the structure that independent construction specialists (those with Class C licenses) like plumbers, HVAC techs, and welders use, as they’re often one-man bands.

In California, contractors operating as sole proprietors must register their business with the county clerk’s office in the county where the business is located. They must also obtain an Employer Identification Number (EIN) from the IRS, even if they don’t have employees, as an EIN is required for certain federal tax filings.

Partnership: Shared Ownership and Responsibilities

A partnership is a business structure where two or more individuals share ownership. Partnerships can be general or limited in liability – which essentially defines what you’re liable for in case of losses.

In a general partnership, all partners share in the business’s profits and losses, and each partner is personally liable for business debts. In a limited partnership, one or more general partners have unlimited liability, while the limited partners have liability only up to the amount of their investment.

This setup is a good situation for family businesses or situations where you and some of your friends, family, or local community are all banding together to work together. This way, the people involved in your company’s success are liable for losses as well as profits.

When setting up a partnership, documentation is key. Partnerships require a written agreement detailing the division of profits, roles and responsibilities, and procedures for resolving disputes. Partnerships in California must register with the Secretary of State and obtain an EIN from the IRS.

Corporation: Maximum Protection with Increased Complexity

“Corporation” might be a dirty word nowadays, but for contractors, it can be a very useful business structure. A corporation is a legal entity separate from its owners, providing the most protection from personal liability, but the tradeoff is it takes tons of resources to begin – and even more to maintain.

Corporations have the most complex business structure and require more time and money to maintain. Corporations are required to hold regular board meetings, maintain corporate records, and file corporate income tax returns – all of which are extremely complicated and difficult, especially for corporations.

In addition to filing a formation of business with the California SOS, corporations must also adopt bylaws, issue shares of stock, and file an annual report. Corporations are taxed at the corporate rate and may face double taxation if profits are distributed to shareholders as dividends.

Limited Liability Company (LLC)

An LLC combines the liability protection of a corporation with the tax benefits and simplicity of a partnership. This, in addition to Sole proprietorship, are rather common in the construction world, as it blends both the liability protection of corporations with the freedom and flexibility of a sole proprietorship or partnership.

Owners of an LLC, known as members, are not personally liable for the company’s debts and liabilities. There can be as many members as you want to name. We have to recommend an LLC structure for your contracting business, it’s a nice balance of all the other various structures.

The Role of Qualifying Individuals in Business Structures

In California, every contractor license requires a qualifying individual, or “qualifier,” who has demonstrated their knowledge and experience through the application process and holds one or more license classifications. If you’re a contractor, you either are a QI or work for a QI.

A qualifier may be a Sole Owner, Qualifying Partner, Responsible Managing Employee (RME), Responsible Managing Officer (RMO), Responsible Managing Manager, or Responsible Managing Member.

Being a qualifier on a license can be a significant risk and liability. Under Business and Professions (B&P) Code section 7122.5, if the performance of an act or omission by the license constitutes a cause for disciplinary action, it also is a cause for disciplinary action against the qualifier, regardless of their knowledge and participation.

Conclusion

Choosing the right business structure for your contracting business in California is a critical decision to both your business’s success and your personal liability. It’s essential to consider your business’s nature, your personal risk tolerance, and your long-term business goals when making this decision, as this decision is extremely subjective and equally important.

When opening your business, it’s definitely worth the time to meet with someone who can help you make the right decision. Someone with experience in California law knows the tax codes, and has the general financial know-how that can provide individualized advice – these are definitely worth the money when opening your business.

Additional Reading

“Starting a Business Checklist.” California Secretary of State
“Employer ID Numbers.” Internal Revenue Service
“Partnerships.” Internal Revenue Service
“Corporations.” California Secretary of State
“Corporation Tax Rates.” Franchise Tax Board
“Contractors State License Board.” State of California
“Absentee Qualifiers.” Contractors State License Board

Do You Really Need to Join A Union To Become A Master Electrician?

If you’re an electrician or thinking about becoming one, you’re probably thinking about joining the union – whether that’s the national unions like the IBEW and NECA, or your local union like the CSAEW. If you’re even vaguely aware of electricians, what they do, and what the career entails, then surely you’ve at least heard of these.

These unions are the collective bargaining groups in the electrician’s field, and beyond the basic benefits of unions like arguing for wage and safety standards, the union serves as a psychological standard for electricians.

That is to say, being a union electrician carries a certain amount of prestige for electricians – it legitimizes many of them in the eye of the public. Likewise the title “Master Electrician” – it’s a title that everyone has heard from and it carries with it an air of trustworthiness and quality.

The thought that comes into one’s mind when one hears “master” versus “journeyman” or “apprentice” is that of a professional versus an amateur. Anyone who aims to be an electrician wants to be a master electrician.

What is a Master Electrician? And do you have to be in a union to become one? In this article, we’ll examine what a master electrician is, how to become one, and how the IBEW fits into this whole thing. Let’s take a look.

What Is A Master Electrician?

At the pinnacle of the electrical profession stands the master electrician—a title that signifies not just expertise but years of dedication, training, and hands-on experience. But what does it mean? What is a Master Electrician?

To be honest, it’s a little nebulous and frankly, ill-defined. A master electrician is actually not a specific title, like a journeyman or an apprentice. Rather, it’s a general signifier that suggests an electrician who has gone as far as they can go in their field.

What that means is typically a few things. A master electrician is a title that exists for electricians who have completed the apprenticeship and journeyman stages of their careers. They are people who have passed all the exams, gotten all the certifications, have worked the hours, and have overseen journeyman and apprentice electricians.

The specific requirements for becoming a master electrician vary by state, but generally speaking, it’s a title that only exists by necessity; it describes electricians who have surpassed journeyman status.

It’s also a term that seems to be dying out as the electrical profession continues to become more standardized. For example, California doesn’t create a distinction between these. You’ve satisfied the requirements to become a licensed C-10 electrical contractor, in which case, you get your license. Or you’re not. There’s no in-between.

In other states, like Arkansas or Colorado, there are distinctions between different types of electricians (some even getting as granular as apprentice journeyman electricians), so be aware of what the requirements are in your state. You may have to apply for a new license every single time you reach a new designation.

The long and short of it is what a master electrician actually is is vague at best, and meaningless at worst. There are some states where it doesn’t even exist.

Do I Have To Join The Union To Be A Master Electrician?

So now that you know that a master electrician simply means, well, being a good electrician for a long time, you can finally start moving in that direction. In some states, it’s a meaningless title or one that doesn’t exist. In others, becoming a master electrician is a quantifiable boost to your career.

Either way, the question remains: do you have to join the union to become a master electrician? In most cases, the answer is: technically no, but realistically yes.

Why do we say that? Well, because even though you are technically not required to be a part of any trade organization to become a master electrician in any state, the benefits of electrician’s unions are powerful. They provide invaluable resources that make getting any electrician’s license easier – they can definitely point you in the right direction to your master’s status.

You don’t need a union for anything as an electrician, really, but they do provide strong support for new electricians especially. However, you can still gain the same skills from non-union apprenticeships or non-union trade associations.

Union apprenticeships are known for their competitiveness and rigorous standards that will set you up in the professional for life, as well as induct you into the union, a big benefit to many just starting out. Union apprenticeships come with added prerequisites but offer better pay and benefits. Such apprenticeships are coordinated through partnerships, notably the International Brotherhood of Electrical Workers (IBEW) and the National Electrical Contractors Association (NECA).

Non-union apprenticeships offer more flexibility and are often preferred by those who wish to avoid union dues and seek a less structured work environment. local contractors or non-union trade organizations, such as the Independent Electrical Contractors (IECI) or the Associated Builders and Contractors (ABC) offer these apprenticeship programs and can be a good start for people who lack the money for union dues.

The reality is both pathways are equally viable. Electrical work is pure science that anyone can learn – even from a library – but both come with pros and cons that may fit your lifestyle better than the other.

The Transition From Apprentice to Master

The journey from an apprentice to a master electrician is filled with milestones and largely dependent on where you live. In some states, there are specific requirements that delineate between apprentices, journeymen, and master electricians. As we said before, in some states, the master electrician title does not exist at all!

In general, though, you’ll often see an hourly or yearly work requirement. That is to say, in order to be certified as a master electrician in certain states, you have to either work a number of hours or work for a number of years in a certain position.

For example, in Georgia, you can either do four years’ on-the-job training or four years’ apprenticeship and that’s it – you can get your license. In Arkansas, you need to complete 8,000 hours of work experience, AND 2,000 hours in the classroom, AND you have to pass an exam!

This underlines all the different definitions and standards for what makes a master electrician. In reality, what makes a master electrician depends on your local jurisdiction, on both a state and municipal level. If you’re reading this, you probably already know your area’s regulatory requirements. If you don’t – you need to get into gear!

Licensing and Regulations

Master electrician licensing is a complex tapestry of requirements that vary across states, and they become increasingly complex as you get more local – with town, municipal, and county regulations coming into play with state regulations as well. In some places, you’ll be up to your neck in licenses and regulations before you’re even a journeyman!

While the National Fire Protection Association’s National Electrical Code (NEC) serves as a foundational standard for many states, local jurisdictions often have their own specific requirements, modifications, and examinations, and as we covered in the last section, they can be radically different state-by-state.

In most cases; however, it’s a simple case of doing on-the-job training, in the form of apprenticeship, and then journeymanship. Only after completing these two steps can you reach the next level of becoming a master electrician.

Circling back to our central question: Do you have to be in a union to be a master electrician? The answer is no – with a ton of caveats.

While unions offer a myriad of benefits and can significantly influence an electrician’s career, they are not a mandatory or exclusive pathway to mastery. You don’t ever have to join a union to get your contractor’s license or to become a certified master electrician. And in many areas – like the 40 million people in California – master electricians don’t even exist!

That said, the electrician’s union is giant and popular amongst electricians for a reason – they do provide quite a bit of value to electricians just starting out and those at the end of their careers. If you’re just starting out, we recommend checking out an introductory meeting at your local chapter of the IBEW.