As construction activity dwindles, so does licensing

We see them throughout Nevada: A pickup truck with ladders atop a metal rack; a windowless van pulling a trailer loaded with sheet metal; a box-like service truck with large letters painted on the side identifying the kind of business the driver represents.

It may be a plumber, painter, landscaper, electrician, a roofer or scores of other providers of essential services in today's economy.

But the most important feature that should be visible are the numbers following the abbreviation "NV License #" because it signifies the business is owned by a contractor who has passed muster and is licensed to provide contracting services for Nevada residents.

Even though construction activity has declined, state regulators say they're still busy chasing down unlicensed contractors who advertise on supermarket bulletin boards, Craigslist or elsewhere.

Under Nevada law, a contractor who provides services in the state is required to include the license number provided by the Nevada State Contractors Board on all advertising, the vehicle, all bids and contracts. If there is no license number visible, it should raise a red flag for consumers, the agency says.

Licensed contractors are required to carry insurance, including worker's compensation coverage. Without such coverage, residential customers could be held liable for damages arising from injuries to that contractor or employees. Homeowners who hire unlicensed contractors are also ineligible for the agency's residential recovery fund should damages result from work performed.

"When our economy was booming, we did attract many unlicensed contractors who were doing business here," says Art Nadler, a spokes-person for the contractors board. "They come into an area figuring they can drum up business. But they also travel around a lot when the economy is bad. A lot of unlicensed people are out there today. Our job is to find them, issue them citations, and encourage them to become licensed."

Nadler says the licensing law is designed to protect the public from unscrupulous individuals who may be in it for the fast buck, intend to defraud the consumer, or are unable to perform certain contractor jobs to the satisfaction of the consumer. In order to be licensed in Nevada, the individual must demonstrate they have four years of experience in a specific trade over the past 10 years. They must take a trade test and a business law test.

"We check their references and their financials and help them determine what kind of surety bond they will need," says Nadler. "Our staff tries to answer all of the applicant's questions."

The board has also begun a business assistance program to help individuals work through the maze of the license application process. Workshops have been held in Las Vegas, Reno and Elko for those considering seeking a con-tractor's license. In addition to a workshop, applicants are given the opportunity to have their paperwork reviewed by agency staff members before finally submitting them for approval.

The numbers of applicants, as well as licenses issued by the agency, has declined since the first of the year. Through January of 2010, there were 510 contractor license applications submitted. During the same month, 387 new licenses were approved.

During July of this year, there were 123 applications for contractor licenses, and there were 100 issuances. The latest figures through the first six months of the year shows there were 16,827 licensed contractors doing business in Nevada compared with 17,386 in January of this year.

When residential customers are dissatisfied with work performed by licensed contractors, they have the right to contact the state agency and are encouraged to file a complaint. Nadler says the board investigates every complaint regardless of whether it is concerning a licensed or unlicensed contractor.

"If it is an unlicensed contractor, we will try to find that individual and we will issue a citation," says Nadler. "Once a citation is issued, it is out of our hands. That's when the court system takes over." Regarding licensed contractors, Nadler said the board has a number of options, including seeking remedial action that may include fines.

The board may also suspend or revoke licenses in more serious cases.

Similar to the FBI's 10 most wanted fugitives list, the board also publishes online the photos and information on the top 10 unlicensed contractors in both southern and northern Nevada who have at least one court warrant outstanding.

Nadler cited one example in the greater Reno area where an unlicensed contractor was sentenced to 12-to-18 months in the Nevada State Prison following his conviction of contracting without a license, diversion of funds, and obtaining money under false pretenses.

In that particular case, the individual had his sentence commuted to five years probation and was ordered to pay $4,000 in restitution, a fine of $5,000, plus court costs. Even though this individual was arrested in California, he was extradited to Nevada.