Summer/Fall 2006 - ASID Georgia Chapter

georgia’s new contractor licensing
what does it mean for design professionals?
article by Kevin M. Veler, Esq.
Are you prepared to get another license to stay in
business? Think Georgia’s new contractor licensing
act does not impact designers? Ready for a shock?
Registered Interior Designers, already licensed under Georgia law,
may now also need to hold a contractor’s license to continue their
current business! Got your attention now? So let’s discuss what
Georgia’s new contractor licensing system is and why it may impact
designers. Then we will examine our options for protecting our
businesses via our current licensing status with the state.
The Georgia licensing law went into effect on July 1, 2005.
Any contractor performing “construction” after January 1, 2008 is
required to have a contractor’s license unless the work falls under
the very limited exceptions. So let’s understand what constitutes a
contractor under the act.
Who is a Contractor?
Work performed by designers often involves the improvement
of real property and, at a minimum, construction management services.
Designers often have contractual risks to the owner for the
construction. Those services typically would fall under the broad
definition of contractor (please see the ASID GA website for full
definitions of contractors). It takes a very limited business model
to avoid qualifying as a “contractor” under the new law. Designers
will need to limit their business models (which could create excessive
economic hardship in the marketplace), find an exemption
from the coverage of the act or apply for a license. And there is an
extremely important deadline looming at the end of this year! **
There are a few exemptions from the act. Please see the inset
below to see why Registered Interior Designers are not exempted
from the Georgia construction licensing act and visit www.asidga.
Why Registered Interior Designers
are not exempted from the Georgia
construction licensing act
Architects are exempt from licensing
and many would think that because
Registered Interior Designers are
regulated by the Georgia State Board
of Architects, Registered Interior
Designers would be exempt as well. A
technical reading of the law indicates
that Registered Interior Designers are
NOT “architects” licensed under Chapter
4 of Title 43; rather Registered
Interior Designers are registered as
“designers” under Article 2 of chapter
4 of Title 43.
What does this mean? No official ruling
from the State Licensing Board for
General and Residential Contractors
on this specific issue is posted on the
official board website; however, it does
not appear that there is an exemption
from the coverage of the construction
licensing act for Registered Interior
Designers. IF designers are NOT
EXEMPT and to the extent they are
covered by sections of the Act regarding
construction, they are required to
be licensed.
org for more details.
So how does this pertain to me?
Some feel the term “Specialty
Contractor,” and the related exception
from the coverage of the act,
will allow them to avoid obtaining
a contractor license. A designer
with this limited business model
may fall within the specific exception
provided they can overcome a
big obstacle. The work that a specialty
contractor may offer must be
done ONLY by “direct employees.”
A specialty contractor may perform
limited, specialty, or specific trade
contractor work, which does not
entail the delegation or assignment
to or engagement of any other
person or entity other than direct
employees. If you limit your business
model, in a changing environment,
you may not be able to take
on desired work and ultimately you may find that you will have to
obtain a license anyway.
Licenses available
There are three types of licenses available: Residential – Basic
License; Residential – Light Commercial License; and General
Contractor License. The work that may be performed is determined
by the type of license. Please see www.asidga.org for definitions on
the three different types of contractors and visualize the work you
anticipate performing. If you are going to obtain a license, the type
of license you obtain will be critical.
How to apply
Those who want a license will have to either have file an application
and take the appropriate test prior to the January, 2008
date OR they will have to file an application and obtain an exemption
from examination based upon their experience or reciprocity
(whether interstate or intrastate). Interstate reciprocity will be
determined after January 1, 2007. **Examination exemption applications
will only be accepted by the Construction Licensing
Board between January 1, 2006 and December 31, 2006. In
addition there is a currently a $200 application fee.
Conclusion
This article is based the licensing statutes currently existing on
June 1, 2006. It is anticipated that there will be a number of revisions
in the 2007 legislative session. Review the inset box below
on “What should you do?” and consider your options. Additional
information and applications are available at the website for the
State Licensing Board for Residential and General Contractors:
www.sos.state.ga.us/plb/contractors. ASID will also be posting information
on its website & publications. During this critical period,
please keep up to date with the information posted. If you are not
a registered interior designer, you
should strongly consider becoming
one in the event that an exemption
is created specifically for
licensed interior designers under
the contractor licensing act.
What should you do?
There will be revisions to the current
act in the 2007 legislative session to
correct a number of problems. It is
very likely that there will be some effort
by a number of professional associations
to create additional exemptions
similar to those granted to professions
such as architects and engineers. It
is also likely the Georgia ASID will
attempt to find a solution which
some would propose should exempt
registered interior designers who are
licensed by the state under NCIDQ
authority. However, in the world of
politics, there is no assurance that an
acceptable solution will be achieved.
Unless legislative relief is obtained, the
options for designers at this point are
very limited. For those who can qualify
Kevin has over 23 years experience in law
and is also the legal advisor to the National
Association of the Remodeling Industry
– Atlanta chapter. Kevin may be reached at
770.752.0990 or via email at kmv@kmvlaw.
com. This article is for general purposes only
and does not constitute specific legal advice.
Copyright © 2006 Kevin M. Veler
For the full article, please visit www.asidga.org
for an exemption from examination,
it is clearly advisable to complete
application and obtain a license. To
do so, you need to file all documents
prior to December 31, 2006. You may
find the application and other important
information at www.sos.state.
ga.us/plb/contractors. For those who
cannot qualify for the exemption, if the
political response fails, you may want
to consider making application after
January 1, 2007 for taking the exam
and obtaining a license.
At a minimum, you need to consider
having your contract reviewed by legal
counsel to assure that your contract
will be in compliance with the new law
and that you will not perform work for
which you are not licensed.
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