California’s Latest “Blitz” Against Unlicensed Contractors

On Friday, July 19th, the California Contractors State Licensing Board (CSLB) announced it had completed a “summer blitz” sting operation against 79 unlicensed contractors in six California cities. The contractors were arrested and issued Notices to Appear (NTA) in court to potentially face misdemeanor charges of unlicensed contracting, which could result in up to six months in jail and/or a fine of $5000.

A press release put out by the CSLB indicates that the majority of the “phony contractors” were busted after CSLB investigators contacted them in response to advertisements for contracting work on Craigslist. Those who were busted through Craigslist often face charges of “illegal advertising” as well. Sting operations against those willing to work but unable or unwilling to comply with onerous and excessive licensing requirements has become a pastime of the CSLB, which sustains itself with a $60 million annual budget predicated on various fees and fines it issues in exchange for government permission to work or punishment to those who fail to comply.

The CSLB’s Statewide Investigative Fraud Team (SWIFT) conducted the July 17-18th operation by posing as “homeowners seeking bids for home improvement projects, including painting, electrical, landscaping, flooring, tile, concrete, ornamental metal, fencing, and tree removal work.”

The CSLB notes in the press release various examples of the people they’ve busted:

  • “One suspect brought two employees and supplies with him, expecting to get the job and start right away. As the employees started to unload their tools, the boss received his NTA.”
  • “A suspect asked investigators not to give him an NTA because it would violate his parole. He received an NTA.”
  • “Oxnard Code Enforcement issued 15 citations to suspects who didn’t have a city business license. Redding (July 17 only)”
  • “At least one suspect is a repeat offender and could face a mandatory 90-day jail sentence if convicted a second time.”

The CSLB, which licenses approximately 300,000 contractors in over 40 different specialties ranging from electrical work to tree trimming, routinely conducts large-scale sting operations and produces videos on its Youtube channel featuring the sting operations. The sting operation press releases often make a point of mentioning whether or not any of those busted have been convicted of a felony in the past; one convicted felon was among the 79 busted in the latest “blitz.” Of course, the majority of those arrested in CSLB sting operations aren’t arrested for harming consumers, or for what they’d done in the past, but instead for being willing to work and following up on (set-up) customer inquiries.

In California, it is against the law to work as a contractor without a license on projects worth more than $500. Aspiring tree trimming, landscaping, or concrete laying contractors must submit fingerprints, take licensing exams, and have four years of work and education experience in order to become a contractor. According to the Institute for Justice, California licenses 18 medium- to low-wage contracting jobs that many, if not most, states don’t bother to regulate. Not too surprising from a state that once considered licensing dog groomers.

California legislators and regulators should ask themselves: Do we really need to be using the force of the state and resources of law enforcement to regulate who can perform home improvement projects? Even accepting the notion that government intervention is justified when public and consumer safety is at risk, it is a stretch to argue that consumers can’t make simple home improvement contracting decisions for themselves. Even less sensible is the idea that government should be purposely arranging sting operations to bust people willing to take on such work.

For more on occupational licensing, check out Adam Summers’ 2007 report on the state of licensing across the country.