Businesses with contractor licenses must have a licensed RMO (Responsible Managing Officer) or RME (Responsible Managing Employee). The RMO or RME is essentially the qualifier for the company’s contractor license.
SBA Lender Requirements for Buyers Acquiring Construction & Contractor Businesses
The SBA recently issued guidance clarifying the licensing requirements for businesses with Contractor Licenses, confirming that the Seller may not act as the RMO (Responsible Managing Officer) or RME (Responsible Managing Employee) of the business post-closing. The SBA also stated the RMO or RME must be a buyer listed on the purchase agreement with equity in the business and be a signer on the loan. SBA lenders cannot accept an employee RME.
Check with your SBA lender for their specific licensing requirements, and see the CSLB Contractor Licensing requirements below for information on qualification requirements and obtaining a contractor license.
CSLB (Contractor State Licensing Board) Contractor Licensing Requirements
Practical Experience
The CSLB requires four years of experience to obtain a contractor’s license. The experience can be comprised of experience in the particular trade and general construction experience, with a minimum of one year in the trade.
Education
A Bachelor’s degree in Engineering can count for two years of experience, and a Master’s degree in Engineering can count for four years of experience. Note that only degrees in Construction, Structural, Electrical, Mechanical, and Civil engineering are accepted by the CSLB for experience.
The links below are to the CSLB Licensing Requirements pages
CSLB Qualifying Experience for the Contractor License Examination
Acceptable Supporting Experience Documentation
htps://www.cslb.ca.gov/AcceptableDocuments
CSLB Processing Times
https://www.cslb.ca.gov/OnlineServices/ProcessingTimes/ProcessingTimes.aspx
CSLB Laws & Regulations