As anyone who has been connected with us for any length of
time will know, we are always saying that things could change at any time. Well
they did, but thankfully the state has given us time to adjust by allowing us
to continue the old way for a while as we (and they!) learn their new system.
What are we talking about? New applications. The state has updated their forms
and we have scoured them to be able to let you know how they are easier than
the old ones and more importantly how they are more difficult.
Let’s start with the easy. For Initial Issuance
applications, the state no longer requires someone else to verify (sign off) on
experience. Also, none of the new applications require bank letters or financial
statements. The form that was streamlined the most, though, is the Qualifying
an Additional Business Entity application. They no longer require CPA prepared
financials or letter of capitalization, 3-months bank statements, bank
verification letter, a list of projects completed by each company, information
about who can pull permits or vendors, or a signature from a “responsible
party” of each company.
This is sounding pretty good, maybe too good, right? Well,
now let’s discuss why they are harder. Old applications only looked at credit
reports for open bankruptcies/liens/judgments, but the new applications also
look at credit SCORES. Any applicant with a credit score below 660
is required to get a financial stability bond.
For Division-1 licenses (CRC, CBC and CGC), the bond is $20,000. For
Division-2 licenses (everything else), the bond is $10,000. Bond amounts can be cut in half ($10,000 D-1,
$5,000 D-2) by taking a 14-hour financial responsibility course, but we are
finding that surety companies are only offering these bonds on a very limited
basis. From what we’re hearing right now the bond cost is around 3-5% of the
bond amount PLUS collateral equal to the bond amount!
Although experience requirements have not changed, the way
that experience is provided on the application has become much more detailed. Now (for D-1 apps) every month of experience
required needs to be accounted for on the paperwork with specific projects. Also, the main ‘buzz words’ of each license
type are listed as check-box items. Each
project must list the specific time period when the work was performed, and the
check-boxes that apply to the project must be selected. The combination of check boxes & months
must be calculated to come up with the appropriate amount of experience. D-2 is a bit more lenient than D-1, but the
details are still much more elaborate than on the old forms. In addition to all
of that, the name, license number, email address and phone number of the
contractor that supervised the experience must be listed for each project. This is to make sure that only experience
gained while under the employ of a licensed contractor is used on the
application.
We know this is a lot to take in… trust us… WE KNOW. We have until July 13th
to submit the old forms, which gives us some time to learn the new ins and
outs, so to speak. No one likes change, but as always, if you have any
questions just give us a call. The one thing that can be counted on, we are
here to help you.
