The vast majority of Nevada industries are regulated in some way or another, and many of the related regulations and regulatory agencies are obvious. For instance, the Department of Motor Vehicles, in ensuring the safety of our roadways, regulates Nevada drivers and vehicles by issuing permits to qualified drivers, and license plates and registration cards for vehicles meeting DMV standards. Most people can vividly recall the nerves they felt at 16 years of age upon entering and, with luck, the relief upon leaving the DMV to get their first driver’s license.
Other regulatory agencies operate more behind the scenes and Nevadans go about their daily lives without giving much, if any, thought to what those agencies do on a daily basis. For instance, the Gaming Control Board ensures that casino operators stay within rules designed to protect consumers from predatory gaming practices. The Public Utility Commission regulates gas, electric, and other utilities to ensure fair rates for all Nevada businesses and citizens. The State Purchasing Division ensures that the companies and individuals providing goods and services to the State do so under fair and competitive contracts.
In addition, a host of licensing agencies have been created to regulate specific professionals, including doctors, nurses, attorneys, accountants, engineers, land surveyors, and many others. Construction professionals are regulated by the State Contractors Board. The State Contractors Board was created by the Nevada Legislature in 1931 and is authorized to issue licenses to contractors that meet the standards they establish. Contractors may be issued licenses to perform specialized functions, like plumbing or electrical work, or they may obtain licenses as a general contractor.
In all instances, a contractor must pass a licensing exam and go through a rigorous application process that will include the Contractors Board reviewing, among other things, an applicant’s criminal and financial background.
Contractor’s licenses are generally limited in accordance with the financial stability of a contractor. A contractor’s license, which is viewable by the public at the Board’s offices or on its website, will have a monetary limit, meaning that the contractor may only accept projects up to a certain dollar value.
Ostensibly, this creates protection for the consumer. If a contractor’s monetary license limit is $1 million, the consumer can reasonably expect that it can responsibly and capably handle a project up to that value.
One criticism of monetary license limits, however, is that they are tied inextricably to the status of the contractor’s bank account and the Contractors Board is given unfettered authority to reduce a contractor’s monetary license limit when he or she falls on hard times, which was the case for many contractors during the recent recession. Such a reduction operates, effectively, to keep the contractor down by restricting the types of projects he or she is able to accept, regardless of his or her actual skill level and expertise.
In addition to monetary license limits, contractors are generally required to post a bond with the Board. In the event of a valid claim by a homeowner, for instance, the Board may authorize the release of the applicable contractor’s bond to the homeowner as a remedy. Contractors also pay annual fees, and a portion of the fees paid by residential construction contractors are deposited into a fund known as the Residential Recovery Fund, which is also made available to help rehabilitate a homeowner who may have been harmed by a contractor’s negligence or violation of the applicable contract.
Further, the Contractors Board provides processes by which a homeowner may file complaints or claims against a contractor for any number of alleged violations. In such event, the Board may assign an investigator to visit the site of the project and/or sit down with the complainant and the contractor to ascertain whether any violation of Board regulations has occurred. If the investigator and/or other Board staff determine that a violation has occurred, a formal proceeding may be initiated in which the contractor appears to plead his/her case before an administrative law judge, who will make a ruling on the complaint. If a contractor is found guilty of violating Contractors Board regulations, the contractor is subject to several possible penalties, including fines and suspension or revocation of his/her license.
Whether you are a homeowner with a complaint against a contractor who failed to complete your project as expected, or a contractor facing discipline by the Contractors Board, it may be necessary to obtain the services of a qualified attorney to assist you with the process to ensure your rights are protected. In doing so, be sure to look for experienced administrative law attorneys that are well-versed in the statutes and regulations governing proceedings before the Contractors Board.
This article was written by Justin Townsend, who joined the team of Allison MacKenzie in 2013. His areas of practice include real estate, natural resources and business law. Allison MacKenzie sponsors this content.
