If it’s fixed it can also be ‘brokered’. How can you cancel a license and still qualify another? You can also ‘qualify’ twice in the right circumstances and another contractor wants to keep the family in the business, maybe…


Q: I have a question.  I am a Business Broker and one my client’s has a CSLB license (“License A”) which is no longer needed as he just sold his business.  However, he is now Responsible Managing Officer (RMO) Qualifier for Seller (“License B”).  May he cancel License A without affecting his ability to act as RMO for Seller (License B)?

A: Yes, he should be able to cancel License A without it affecting License B.


Q: I was reading where two companies can share a Qualifying Individual if the majority of the Officers/Members/Managers are the same between the two companies. We are going to request this option but the individual we are planning to use to Qualify both entities is an employee with no ownership, not an Officer. Do we need to give him an Officer title in order to be approved for this request? 

A: An RME (Responsible Managing Employee) can qualify for two firm’s licenses when the majority of the personnel listed on the license and CA SOS records are the same as long the individual can certify that he/she works at least 32 hours a week (or 80% of the companies’ operating time) for both firm’s licenses. Many times companies will opt for the Qualifying party to become an Officer due to the hour requirement for RME’s. Either way, remember that the RME/RMO is responsible for exercising supervision and control  of their employer’s construction operations for both companies. 


Q: I have a Sole Proprietorship license. Looking forward to someday retiring, can one of my sons automatically take over the business in the future or do they need to be working for me in order to take over? In the event they do not want to continue the business, will I be able to sell my license?

A: An immediate family member can request to have your license number transferred to them, however if they are looking to take advantage of the family waiver (of the exams), they would have had to of worked for you for at least five years. If they are not concerned about the waiver option, they can still request your license number and take the exams, but they still need to have at least four years of experience in the trade. If you are considering selling your business to someone other than a family member, you would likely want to consider obtaining the license as a corporation or LLC. Holding the license as a corporation or LLC allows you to sell the business to family members OR the general public. You should probably contact a business broker or an attorney for more information on selling a business and the entity type best suited to your need. 


While knowledge is power, knowing where to go for the answers is half the battle. Get expert assistance immediately when you call 866-443-0657, email info@cutredtape.com, or write us at Capitol Services, Inc., 3609 Bradshaw Rd, Ste H, #343, Sacramento, CA 95827. Search past columns at www.cutredtape.com