In the last days of the 2020 historically-shortened legislative session, the California Senate unanimously passed Senate Bill 1189, amending Bus. & Prof. Sections 7028.16, 7055, 7151, 7057.5, as well as updating the Penal Code relating to a criminal conviction for construction. Senator Mike McGuire proposed the bill during the 2019-2020 regular session, and it was co-authored by two members. The bill is supported by the American Subcontractors Association-California, Associated Builders and Contractors Northern California Chapter, the Contractors State License Board, the City of Santa Rosa, and more.
SB 1189 was officially signed into law by Gov. Newsom on September 30, 2020, and goes into effect on January 1, 2021.
SB 1189 addresses numerous issues by revising the one-size-fits-all contracting license classification that is the Class B license. Here are the changes contractors need to know from the SB 1189 Business and Profession Code (BPC) amendments.
- The amendments create a new classification of contractor called “Residential Remodeling Contractor.” It upholds the current requirement for a Class B license that a residential remodeling contractor cannot accept a contract if the contract does not include 3 or more unrelated trades or crafts unless the contractor holds the separate appropriate license classification or subcontracts with a contractor that holds an appropriate license classification. The “Residential Remodeling Contractor” license classification creates an opportunity to move unlicensed handymen out of the shadows and into licensed work without the hurdles of work experience years and additional expertise needed to obtain the Class B license. Although the new classification goes into effect January 1, 2021, contractors will not be able to test for the license until the CSLB begins administering the exam in the summer of 2021.
- Currently, a contractor making repairs to a residential or non-residential structure for damage caused by a natural disaster without the appropriate license is guilty of a crime, punishable as a misdemeanor or felony. Under BPC 7028, contracting without a license or appropriate license is a misdemeanor, but depending on the severity and frequency of the crime, felony charges are possible. The amendments expand this provision to include improvements, additions, and subtractions to property and structures.
- The new amendments also close a loophole in California criminal laws by expanding the definition of home improvement to include the reconstruction, restoration, or rebuilding of residential property that was damaged or destroyed by a natural disaster declared a state of emergency by the Governor or an emergency or major disaster declared by the President of the United States.
When asked about the intent behind the bill, Senator McGuire said, “By creating a new contract licensing classification specific to residential rebuilding, this bill ensures that contractors who accept projects after a natural disaster can be held accountable for their actions.” Senator McGuire represents District 2, who saw devastating wildfire destruction in 2017 and 2018. Seeing some unlicensed contractors take advantage of those who lost their homes and property from the fires was the driving force behind his introduction of SB 1189.
Additionally, SB 1189 protects consumers by allowing the California Department of Justice to prosecute unlicensed contractors and contracting companies who take advantage of those recovering from wildfires and other natural disasters. If disciplinary action is undertaken, the state Office of the Attorney General represents CSLB to prosecute the case. The Attorney General is not counsel for the complainant, but counsel for CSLB.
For more information on contractor license classifications and guidelines, visit the CSLB’s licensing classifications page.