DIR Reminds Public Works Contractors to Renew Registration
Before January 1 to Avoid Hefty Penalty
Also In This Update
- Senator Hill to Reintroduce Excavation Bill Next Session
- CSLB Prepares for Jan 1 Roll-out of Simplified Home Improvement Salesman Registration
- Massive Transportation Bill Has No $ for CA Bullet Train
- New Early IRS Interaction Initiative Will Help Employers Stay Current with Their Payroll Taxes
DIR Reminds Public Works Contractors to Renew Registration before
January 1 to Avoid Hefty Penalty
The Department of Industrial Relations (DIR) announced today that a
mandatory renewal deadline is approaching for contractors who bid or work on public
works projects in California. Contractors whose public works contractor registration
expired June 30, 2015, and have ongoing public works projects or plan to bid on new
ones, must pay the $300 renewal fee before January 1, 2016 or face an additional
$2,000 late penalty after that date.
"Contractor registration ensures that only those contractors who play by the rules can
bid and work on public works projects," stated Julie A. Su, State Labor Commissioner.
As a result of Senate Bill 854, all contractors have been required since April 1, 2015, to
register with DIR to be awarded a public works contract, even if the project did not go
out to bid.
If you believe that your public works registration with DIR is still active, you can check
the active contractor registration search tool to locate and confirm your registration. If
your registration does not appear, it may have expired or you were not registered. DIR’s
Frequently Asked Questions page has more information.
If you were registered last year and have not bid nor worked on any public works
projects on or after July 1, 2015, you can renew for this fiscal year without incurring a
The required annual registration fee of $300 is used to fund such activities as DIR’s
compliance monitoring and enforcement, prevailing wage and public works coverage
determinations, and enforcement appeal hearings.
DIR registration requires that all contractors affirm under penalty of perjury that they
have workers’ compensation insurance coverage, have no outstanding wage
judgments, and are licensed with the Contractors State License Board.
DIR maintains a listing of registered contractors and subcontractors on its website to
assist awarding bodies who must confirm this registration before considering a bid or
awarding a contract, and for contractors who must confirm that their bid team members
are registered. For more information, visit the DIR Public Works page.
DIR protects and improves the health, safety and economic well-being of over 18 million
wage earners, and helps their employers comply with state labor laws.
DIR’s Division of Labor Standards Enforcement (DLSE), also known as the Labor
Commissioner’s Office, enforces prevailing wage rates and apprenticeship standards in
public works projects, inspects workplaces for wage and hour violations, adjudicates
wage claims, investigates retaliation complaints, issues licenses and registrations for
businesses and educates the public on labor laws.
Excavation Bill to Be Reintroduced Next Session
I received word this week from Senator Hills’ office that he is planning to reintroduce the excavation bill from last session that the governor vetoed in October. As you may recall, Senator Hill is the San Bruno legislator whose district is where PG&E’s blast occurred several years ago. Since then he has been trying to pass legislation that would put more controls on excavators, make utilities liable if they fail to properly mark and provide for myriad other ‘safeguards’ and, of course, more state agency control.
After several years of working with various stakeholders, a bill was crafted last year that made it to the governor, only to be vetoed by him. Among other things, this bill would have created the “California Underground Facilities Safe Excavation Advisory Committee, within CSLB, to investigate violations of the state's excavation and subsurface installation laws, to coordinate education and outreach, and develop standards.” To read a copy of the bill, please go to:
In his veto message, the governor stated:
“This bill would create the California Underground Facilities Safe Excavation Advisory Committee, within the Contractors' State Licensing Board, in order to enforce existing and new provisions related to safe excavation. I understand that the telecommunications and cable companies have resisted providing explicit enforcement authority to the Public Utilities Commission over excavation safety. However, it is the Public Utilities Commission, and not the Contractors' State Licensing Board, that has the technical expertise and funds and should be given full authority to enforce and regulate excavation activities near subsurface installations.
This is a matter of public safety, and I look forward to working closely with the author to achieve our mutual goal. I am returning Senate Bill 119 without my signature.”
It is important to note that the CSLB was never ‘thrilled’ with the added responsibilities and authority the bill would have placed on them, while the PUC had been one of the original forces behind the bill that had hopes of broadening their authority to ‘take over the world.’
With this in mind, it will be very interesting to see how this all plays out next session! From the get go, none of the stakeholders (other than the state agencies) EVER wanted the PUC to have more authority. Can middle ground be found that satisfies the desires of the governor and the state agencies and also meet the approval of the construction industry? Stay tuned!
In the meantime, Senator Hill’s office said they are trying to schedule a hearing next Thursday, December 17th in Bakersfield of the Senate Subcommittee on Gas, Electric, and Transportation Safety. The reason for this location, according to Senator Hills’ office, is “This event would be on the heels of last month’s fatal dig-in in the Bakersfield area.”
CSLB Prepares for Jan 1 Roll-out of Simplified Home Improvement Salesman Registration
As we have previously reported, the Contractors State License Board (CSLB) is moving quickly to implement a new law that will simplify the current Home Improvement Salesperson (HIS) registration process. The new law takes effect January 1, 2016.
Senate Bill 561 (Monning) simplifies the process to a single registration, while still allowing salespersons to represent multiple employers. The new law removes the current requirement that an HIS register separately with CSLB for each contractor that employs them.
As part of the implementation process, CSLB is notifying by mail the more than 14,000 currently registered HIS in order to update and convert all HIS registration records. Letters are also being sent to licensees who employ registered salespersons.
CSLB encourages all HIS registrants as well as licensees who employ salespersons to review and verify HIS details via CSLB’s online Instant License Check , and take steps immediately to correct any inaccurate or outdated information by filling out a form and sending it to CSLB.
In addition to the single registration, the new law requires licensees to notify CSLB in writing prior to employing an already registered HIS, and to notify CSLB in writing when employment of a registered HIS ends. These new forms will be available on the CSLB website beginning January 1, 2016.
Licensees should also be aware that a HIS is defined in Business and Professions (B&P) Code section 7152 as a person who is employed by a licensed contractor to solicit, sell, negotiate, or execute contracts for home improvements, for the sale, installation or furnishing of home improvement goods or services, or of swimming pools, spas, or hot tubs.
The HIS registration requirement does not apply to those who only sell goods or negotiate contracts at a licensee’s fixed business establishment, where the goods or services are exhibited, or persons who contact prospective buyers for the exclusive purpose of scheduling appointments for a registered HIS.
Licensees should also use this as an opportunity to register any currently unregistered HIS. B&P Code section 7154 states that a home improvement contractor who employs an unregistered salesperson is subject to discipline by CSLB.
Licensees or registrants with questions about the new law, or who want to learn more about the HIS process are encouraged to visit the applicant section of the CSLB website, or call CSLB’s Licensing Information Center at 1-800-32
For a side by side comparison of existing requirements versus the new requirements, please go to:
Massive Transportation Bill Has No $ for CA Bullet Train
Last week I reported on the new transportation bill that was approved by Congress and will be signed by the president this week. The Republican-controlled Congress made sure of one thing in the package – that it would NOT contain ANY funding for the ‘high speed train.’ Read on:
Cal Watch reports that the California’s controversy-plagued bullet train project got a major boost from the Obama administration and Congress in 2009 when more than $3 billion in federal stimulus funding was sent to the state government to buttress the $9.9 billion in bond seed money that state voters had allocated to high-speed rail in 2008 by passing Proposition 1A.
Since then, the California High-Speed Rail Authority has been unable to attract outside investors and doesn’t have even 40 percent of the money it needs to complete the initial 300-mile, $31 billion segment — much less the $68 billion needed to build a rail line linking San Francisco and downtown Los Angeles. This has led bullet-train advocates, starting with Robert Cruickshank of the California High Speed Rail Blog, to repeatedly urge Congress and the Obama administration to provide more federal dollars. In planning documents from three years ago, state officials said they were hoping on $42 billion in federal help.
But Republicans took control of the House in the November 2010 election, and they have repeatedly denounced the state’s project, led by Rep. Jeff Denham of Turlock. And the office of House Majority Leader Kevin McCarthy, R-Bakersfield, has confirmed there’s not a dime for the state’s bullet train in the gigantic, five-year, $305 billion transportation bill that Congress-approved last week in an overwhelming bipartisan vote.
CA Democrats fought for bullet train funds in 2012
In 2012, during negotiations on a similar omnibus transportation measure, California’s House Democrats were strongly criticalof the bill for, among other things, blocking new federal funding for the Golden State high-speed rail project. But Nexis and Google News searches show no similar pointed criticism of the new transportation bill. This 2013 analysis by Governing magazine shows why enthusiasm has waned among federal lawmakers:
In California … if the feds were to pony up the rest of the $42 billion the state is expecting, it would be more than the federal government spends nationwide on grants for new subway, light-rail and bus rapid transit lines combined. … At a time when Congress has canceled White House tours in order to reduce spending, it’s hard to envision Washington lawmakers making that sort of long-term commitment anytime soon. …
In a budget deal struck with Republicans in April 2011, the administration lost funding for its [high-speed rail] program, and it hasn’t come back since. … Meanwhile, despite all his calls for high-speed rail spending, Obama hasn’t developed a concrete proposal on how to provide an ongoing, dedicated revenue stream for those projects, which advocates say is key. Even the nonpartisan GAO warns that counting on future federal funding for projects like the one in California is highly speculative. Joshua Schank, head of the Eno Center for Transportation, says it’s unlikely at this point that the administration will continue to throw its full weight behind high-speed rail because so far the program “hasn’t yielded much dividend politically. Nor,” he adds, “has it yielded much in terms of high-speed rail.”
Cruickshank, however, thinks there’s a maniacal quality to GOP opposition. “To Republicans, of course, the risk to the taxpayer isn’t based in fact but in ideology. They believe nobody rides passenger trains in America, so any such attempt to fund one is doomed from the start. They mention that government might have to subsidize its operating costs and even though the global experience suggests they don’t, they’re ignoring the fact that government massively subsidizes roads without any expectation that they’ll cover their costs,” he wrote in 2013.
Nevertheless, aides to President Obama say he will sign the transportation bill, perhaps this week.
New Early IRS Interaction Initiative Will Help Employers Stay Current with Their Payroll Taxes
The Internal Revenue Service has launched a new initiative designed to more quickly identify employers who are falling behind on their payroll or employment taxes and then help them get caught up on their payment and reporting responsibilities. The effort is called the Early Interaction Initiative.
The initiative is designed to help employers stay in compliance and avoid needless interest and penalty charges. The initiative will seek to identify employers who appear to be falling behind on their tax payments even before an employment tax return is filed. The IRS will offer helpful information and guidance through letters, automated phone messages, other communications and in some instances, a visit from an IRS revenue officer.
In the past, the first attempt by the IRS to contact an employer having payment difficulties often did not occur until much later in the process, after the employment return was filed and the employer’s unpaid tax obligation had already begun to spiral out of control.
“Employers play a key role in our tax system, and we want to offer them the information and assistance they need to carry out that responsibilities,” said IRS Commissioner John Koskinen. “With early interaction, we will be able to offer help weeks or even months sooner, when it can often do the most good.”
Two-thirds of federal taxes are collected through the payroll tax system. By law, employers must withhold federal income, Social Security and Medicare taxes from employees’ wages.
Shortly after employees are paid, employers typically must turn over withheld amounts, along with employer-matching contributions, to the federal government. Though payment schedules vary, these payments, known as federal tax deposits (FTDs), are made electronically through the Electronic Federal Tax Payment System EFTPS. These FTDs are later reported on a return , usually filed quarterly, with the IRS.
Employers, especially those facing liquidity difficulties, sometimes inappropriately divert funds withheld from employees’ pay for working capital or other purposes. Even when well-intentioned, such diversions can quickly result in mounting tax liabilities for the employer, along with interest and penalties, potentially threatening the employer’s financial viability.
Also, employers may have a payroll processor or others handling their payroll, withholding, matching, remittance, and/or reporting responsibilities, which sometimes leads to miscommunication between the parties and may result in tax deposits and reporting not being made as required. Such miscommunication may also quickly result in mounting tax liabilities, interest and penalties that are costly and risky to the business.
To help employers avoid these problems, the new IRS initiative will monitor deposit patterns and identify employers whose payments decline or are late. Employers identified under this initiative may receive a letter reminding them of their payroll tax responsibilities and asking that they contact the IRS to discuss the situation. In addition, some employers may receive automated phone messages from the IRS providing information and assistance. Where appropriate, an IRS revenue officer will also contact some of these employers at their place of business.
A variety of useful information is available to employers on the IRS Web site. Visit IRS.gov and type “Employment taxes” in the search box. Helpful links include:
What Are FTDs and Why are they Important?
Understanding Employment Taxes
Depositing and Reporting Employment Taxes
Employment Tax Publications
Small Business Taxes – The Virtual Workshop (video)
New LAO Blog Series: California's Property Tax: Where Does Your Money Go?
The Legislative Analyst's Office (LAO) has released the first post in a blog series that examines California's property tax system. This blog post, Understanding Your Property Tax Bill, explains the components of the property tax bill and how property tax revenues are distributed among local governments. The post includes two videos discussing the topic. The release of the blog post and videos coincides with tomorrow's December 10 deadline for taxpayers to make their first property tax payments during the 2015-16 fiscal year.
Future blog posts will appear on the LAO's California Economy and Taxes blog (or accessible via Twitter @LAOEconTax). For email alerts concerning the property tax blog series, send an email to Carolyn Chu, the LAO's local government analyst, at email@example.com (Subject: Subscribe).
Access the videos directly using the following links:
Calculating Your 1 Percent Tax: http://lao.ca.gov/Videos/Player?playlistId=96&videoId=145
The 1 Percent Tax—Where Does Your Money Go? http://lao.ca.gov/Videos/Player?playlistId=96&videoId=144
Or for today’s blog post:
California's Property Tax: Where Does Your Money Go? http://www.lao.ca.gov/LAOEconTax/Article/Detail/151