Operating a successful general contracting business in California requires proper licensing from the state’s Contractors State License Board (CSLB). This ensures contractors have the necessary experience and expertise to take on construction projects in a safe and lawful manner.

This guide will walk through the key steps and requirements to obtain a new general contractor’s license in California. We’ll also cover license renewal and reciprocity with other states.

Licensing Classifications

There are three main license classifications in California:

  • Class A – General Engineering Contractor: For specialized engineering projects like grading, paving, steel erection, and more.

  • Class B – General Building Contractor: For managing construction projects involving two or more unrelated trades. This is the most common contractor license.

  • Class C – Specialty Contractor: For particular trades like electrical, plumbing, and roofing. Class C contractors cannot serve as the general contractor on projects with multiple trades.

General contractors will apply for either a Class A or Class B license, depending on their specialty.

Eligibility Requirements

To be eligible for a general contractor license exam in California, you must meet the following requirements:

  • Experience: Have four years of journeyman-level experience in the last 10 years as a foreman, supervisor, or contractor in the classification you’re applying for.

  • Age: Be at least 18 years old.

  • Business name: Provide a business name that will be used for the license.

  • Bond: Obtain a $25,000 license bond.

  • Asbestos cert: Pass the CSLB’s asbestos open book examination.

  • Law and trade exams: Pass the law and business examination as well as the trade examination for your classification.

  • Fingerprints: Submit fingerprints for criminal background check.

  • Fees: Pay all licensing fees.

Let’s look at each of these requirements in more detail.

Experience

You must document four years of hands-on experience in the classification you are applying for. This experience must be at a journeyman level or while working as a foreman, supervisor, or licensed contractor.

The CSLB may be able to credit you for relevant education, military service, or work in a related classification.

Bond

Before you can take the licensing exams or receive a contractor’s license, you must have a $25,000 license bond filed with the CSLB. This bond is for consumer protection in case of any construction defects or contract violations.

The bond must be issued by a surety company authorized in California and use CSLB-approved bond forms. You can also submit a cash deposit of $15,000 instead of a bond.

Asbestos Certification

California requires all contractor license applicants to take the CSLB’s asbestos open book examination. This raises awareness of the risks involved in asbestos abatement projects.

You must complete this exam before you can proceed with the licensing process. The asbestos booklet and exam are available on the CSLB website.

Examinations

To qualify for a license, you must pass the law and business examination which covers licensing laws, project management, and other business knowledge.

You must also pass the trade exam in the specific classification you are applying in, such as general engineering or general building.

These exams are administered at various locations in California. Once your application is approved, you will receive details on registering for the exams.

Fingerprinting

As part of the licensing process, all applicants must submit fingerprints to the CSLB. This allows the board to conduct a criminal background check through the California Department of Justice and FBI.

You will be provided fingerprint forms and Live Scan location information once your application is accepted. Felony convictions can be grounds for denial of a contractor’s license.

Fees

The following fees must be paid during the licensing process:

  • Application fee: $330

  • License fee: $200

  • Fingerprint fee: $49

  • Exam fees: $100 per exam

The total fees for a new license will be around $800 depending on number of exam attempts.

Applying for a New License

Once you meet all the eligibility requirements, you can submit a new license application to the CSLB. Here is the step-by-step application process:

  1. Submit application form: File the Application for Original Contractor’s License along with the $330 fee.

  2. Prove experience: Submit detailed experience documentation covering the past 10 years.

  3. Get bonding: Work with a surety company to obtain $15,000 license bond.

  4. Complete asbestos exam: Pass the CSLB’s open book asbestos exam.

  5. Schedule exams: Once approved, you can register for the law/business and trade exams.

  6. Fingerprinting: Complete Live Scan fingerprinting form and submit prints.

  7. Pass exams: You must receive passing scores on both exams to proceed.

  8. Issue license: Once all steps are completed, your license will be issued.

  9. Activate license: File your bond, pay fees, and show workers’ comp insurance (if applicable).

The CSLB may return applications that are incomplete or lack the required documentation. Be sure to follow all instructions closely to avoid any delays.

It can take 60-90 days for the CSLB to process a new license application and issue the license after passing exams.

Maintaining the License

General contractor licenses in California must be renewed every 2 years prior to the expiration date. To renew a license, you must:

  • Pay the $450 renewal fee

  • Complete any required continuing education courses

  • Have an active $15,000 license bond

  • Provide updated business address and personnel information

  • Show current workers’ compensation insurance (if applicable)

Active general contractors are required to complete 5 hours of continuing education during each 2-year renewal cycle. Courses must be CSLB-approved and cover business management, construction law, Cal/OSHA standards, and other relevant topics.

Letting your contractor’s license expire will require going through the lengthy licensing process all over again. Renew on time to maintain an active status.

Reciprocity with Other States

California has limited reciprocity with other states for contractors licenses. The CSLB currently has reciprocity agreements with only the following states:

  • Arizona
  • Louisiana
  • Nevada

To transfer your license from one of these states to California, you must:

  • Hold a current license in AZ, LA, or NV

  • Have passed the trade exam for your classification

  • Submit a reciprocity application to California

  • Pay the $330 application fee

  • Pass the California law and business exam

  • Meet all other CA licensing requirements

This allows you to transfer your existing license rather than having to apply as a new candidate. All other steps of the licensing process still apply.

California does not have any reciprocity agreements with other states beyond AZ, LA, and NV. Applicants must go through the full licensing process.

Bond Requirements

General contractors in California must have the following bonds:

  • $15,000 license bond: Required for active licensure and renewal. Filed with the CSLB.

  • $15,000 qualifying individual bond: Required if the qualifying individual is a responsible managing employee (RME). Does not apply if the qualifier owns 10%+ of the business.

  • Disciplinary bond: Additional bond required for revoked licenses seeking reinstatement. Amount set by CSLB.

Bonds must be written by a California-approved surety company on CSLB bond forms. The $15,000 contractor bond provides financial protection to consumers and employees in the event of any license law violations.

Having adequate bonding is essential to maintaining an active status as a licensed contractor.

Insurance Requirements

Licensed contractors in California must carry general liability insurance and workers’ compensation insurance.

  • General liability: Covers third-party bodily injury and property damage claims. Minimum $1 million policy recommended.

  • Workers’ compensation: Required if you have employees. Covers medical and disability benefits for job-related injuries.

You are not required to carry general liability insurance by law, but it is highly recommended to protect your business.

Proof of active workers’ compensation coverage is mandatory if you have W-2 employees on payroll. This must be provided whenever applying for a new license or renewing an existing one.

Carrying adequate insurance reduces financial risk and demonstrates credibility to consumers. Consult licensed insurance brokers to find the right policy for your business.

Conclusion

Becoming a licensed general contractor in California involves meeting stringent eligibility requirements, passing multiple exams, and maintaining bonds and insurance. Key steps include documenting experience, obtaining a license bond, completing asbestos certification, passing law and trade exams, submitting fingerprints for background check, and activating the license.

General contractors must also renew their license every two years, which includes paying fees and meeting continuing education requirements. Reciprocity is only available from three states: Arizona, Louisiana, and Nevada.

Complying with all state licensing and insurance regulations is crucial for operating legally and protecting consumers. Resources are available on the Contractors State License Board website during each stage of the application and renewal processes.