Board Buzz – Fall

Greetings from Executive Director C. Frank Wiesner

I am delighted to present the first of what will now be a quarterly e-newsletter aptly called the Board Buzz. We recognize the importance of regularly communicating to our licensees, qualifiers and other interested parties. With that in mind, you can expect to receive newsletter communication from the Board on the first Wednesday of every month. In addition to the quarterly Board Buzz e-newsletter, shorter Board Briefs newsletters will be distributed in the other eight months.

Board newsletters will cover information important for licensed contractors including changes to laws and rules, continuing education information, license renewal updates, and other topics that may affect how a contractor conducts the administrative and regulatory aspects of their business. Feel free to encourage others to sign-up to receive the Board Buzz and Board Briefs newsletters by visiting www.nclbgc.org.

Wiesner moderates panel on skilled workforce

C. Frank Wiesner, Executive Director for the NC Licensing Board for General Contractors, served as moderator for a building industry leader panel discussion on “Reasonable Regulation from a National Perspective” at the Annual Conference for the National Association of State Contractor Licensing Agencies (NASCLA) in August in Baltimore, MD. The discussion focused on the skilled workforce shortage in the construction industry and how the industry is creatively embracing different initiatives to train workers to fill the gap. The discussion and questions and answers from the 150 in attendance centered on reaching a younger audience, women entering the construction industry, immigration policy and numerous examples of private companies including recruitment departments as part of their HR strategy. Representatives from the National Association of Home Builders (NAHB), the Associated Builders and Contractors (ABC) and the Association of General Contractors (AGC) participated.

Welcome Sonya McLamb

Sonya McLamb joined the NC Licensing Board for General Contractors in September. Sonya will serve as Education Coordinator and will be responsible for administering the Board’s continuing education program. She has a variety of education and training experience, including roles with non-profits and state governments. She holds a bachelor’s degree in Business Management from NC State and is currently working on her master’s in education there. Sonya and her husband have three adult sons and enjoy traveling and live music. Sonya also likes gardening and cooking and is a lifelong fan of Tom Petty.

Summary of amended rules effective September 1, 2019

Below is a summary of amended rules approved by the NC Rules Review Commission; they became effective September 1, 2019, and have been implemented by the Board. The amendments to the North Carolina Administrative Code, Title 21, Chapter 12, provide definitions, revise requirements and modernize procedures and guidelines for applicants, qualifiers and licensed general contractors.

Many of the amendments were adopted to provide clarity and understanding so the rules can be more easily interpreted. The following summary highlights the more significant amendments to the rules:

Read full text of rules

  • 21 NCAC 12 .0201 – Definitions – Further defines statutory terms and words found in the Board’s rules.
  • 21 NCAC 12 .0201 – Classification – Adds demolition as a licensed activity for projects at or above $30,000 to the license classifications of Building, Residential, Concrete, Interior Construction, Marine Construction, Masonry Construction, Roofing, Metal Erection, Swimming Pools, and Wind Turbine. There is also included a clarification for the Asbestos classification.
  • 21 NCAC 12 .0204 – License Limitations; Eligibility – Provides for an agreed-upon procedures report as an alternative to an audited financial statement for applicants for licensure and increase in limitation when demonstrating financial responsibility. Also revises the surety bond values for applicants utilizing the surety bond in lieu of working capital or net worth.
  • 21 NCAC 12 .0205 – Qualifier – Clarifies that a qualifier who is not an owner, officer or partner of the licensed entity then the qualifier must be a W-2 employee of the licensee.
  • 21 NCAC 12 .0303 – Application for Licensure – Provides for applicants who are using an exam waiver from another approved state licensing agency or the NASCLA exam shall take and pass a North Carolina Law and Building Code examination prior to licensure.
  • 21 NCAC 12 .0308 – Character References – Defines that an applicant shall submit three character references and defines the elements that shall be included in each reference letter.
  • 21 NCAC 12 .0402 – Subject Matter – Provides that exams shall test the qualifier’s knowledge of the practice of general contracting with the classification of licensure the applicant is seeking. Also provides that all applicants shall be tested on the Board’s laws and rules.
  • 21 NCAC 12.0501 – License Granted – Amends the rule regarding requirements for when a license number must appear. The amended rule now states that license numbers must appear on all contracts and bids.
  • 21 NCAC 12 .0503 – Renewal of License – Eliminates the financial statement from the license renewal application and provides for licensees to attest that they continue to maintain continued financial responsibility. Enables licensees in bankruptcy to use an agreed-upon procedures report as an alternative to an audited financial statement.
  • 21 NCAC 12 .0903 – Application for Payment – Clarifies how a claimant for reimbursement from the Homeowners Recovery Fund must demonstrate that they have attempted execution of a judgment.

Continuing Education update

On July 1, 2019 Governor Roy Cooper signed Senate Bill 55 into law which requires eight hours of continuing education for qualifiers who qualify a general contractor’s license in the classifications of Building, Residential and Unclassified as a condition to license renewal beginning with the 2021 license renewal.

The Board is currently engaged in the adoption of temporary rules which will provide basic guidelines for implementing the continuing education program. It is anticipated the continuing education program will be administered as follows:

  • Eight hours of continuing education annually consisting of a two-hour mandatory course which will be produced by the Board and six hours of Board approved elective credit for classes put on by Board approved providers and instructors.
  • The continuing education year will begin January 1 and end on November 30 each year.
  • In the first-year, courses will require a qualifier to physically attend classes. The classes may be instructed by a Board-approved live instructor or one who has been video-taped or teaches a live multi-location web-streamed class. All courses must be administered by a Board-approved provider.
  • In subsequent years, the Board will provide options to allow for qualifiers to complete the continuing education requirement in an on-line format.
  • The application for providers, instructors and course curriculums to be approved for continuing education courses for the coming year is expected to be released no later than January 2020.
  • Continuing education courses are expected to be offered for credit beginning in the Spring of 2020.
  • Anyone interested in becoming an approved provider and or instructor for continuing education should email the Board at education@nclbgc.org and submit contact information

Monitor the Board’s monthly communications for continuing education updates.

Compliance Corner

By Ryan Cody, Investigator Western Region

Is your qualifier really your qualifier? Are you operating in accordance with the laws and rules in North Carolina? The Board investigates complaints where there is a question regarding the relationship between a licensee and a qualifier and whether it is compliant with licensing laws and rules.

Since 2018, the Board has investigated dozens of cases where a qualifier for a licensee does not meet all requirements of the laws and rules which define the qualifier’s role and responsibilities. For example, companies have applied for a license with a qualifier who is not a W-2 employee of that applicant and does not work with the company at least 20 hours per week. A recent complaint investigation determined the qualifier was paid as an IRS Form 1099 subcontractor and not as a W-2 employee. In another case the investigation revealed that the qualifier was paid as a W-2 employee, however, the annual salary of the qualifier was around $2,000 and the qualifier was not working 20 or more hours per week on behalf of the licensee. The investigation also found the qualifying individual worked a full-time job (40+ hours per week) in a different industry. In these two situations, the qualifier had no knowledge of the project which led to the complaint and the owners who filed the complaint had never met or heard of the qualifier.

Another scenario involved an individual who was listed as the qualifier for a licensee but did not perform any work for or receive any compensation from the licensed company. During this investigation, it was discovered the qualifier was using the company’s license for his own purposes separate from the licensee’s business activity and without the licensee’s knowledge.

The North Carolina Administrative Code, Title 21; Chapter 12 .0205(a) defines a qualifier as a responsible managing employee, officer, or member of the personnel of the applicant. Additionally, 0205(e) further clarifies that a responsible managing employee and/or member of the personnel must be W-2 employees and those who are responsible managing shall work at least 20 hours or a majority of the operating hours of the business, whichever is less.

In these cases, it was determined that the qualifier was neither a responsible managing employee nor a member of the personnel. During an investigation, the Board may request a copy of a W-2 or a copy of the registered corporate documents which identify corporate officers to provide evidence of a qualifier’s status and role with a licensee. If you have any questions whether your qualifier’s engagement meets the statutory requirements or the Board’s regulatory requirements, please contact the staff at 919-571-4183. We would much rather assist you than investigate you.

Disciplinary Action

Read case summaries from August 2018

Reminder about license renewals

2020 License Renewal Applications were delivered to your online license account over the past few days. Please log-in and renew your license today at www.NCCLiC.org.

2020 Online Renewal Instructions