Louisiana Contractor License: About
A contractor’s license in Louisiana opens new opportunities and can build your resume exceptionally. Also, you are required to have a contractor’s license in Louisiana if you are performing commercial or industrial projects at a value of $50,000 or greater. You are also required to have a contractor’s license in Louisiana if you are performing a residential construction project for more than $75,000.
Before you start studying, you should become familiar with the Louisiana State Licensing Board for Contractors application requirements. This will make the application process much less stressful and allow you to focus on your exam studying. The below list outlines a checklist for getting your contractor license in Louisiana:
- Take a NASCLA Exam study course
- Form your business entity that you will be performing work under
- Complete the application
- Pass the NASCLA Exam
- Pass the Business and Law Course
- Complete the financial statement
- Select your Classification
- Designate your Qualifying Party
- Complete online application
- Pay the application fee
The NASCLA Exam
Most states require a trades exam and a business and law exam to obtain your contractor’s license. The NASCLA exam is a trades exam that is accepted and administered in 16 states. This gives you or your entity great reciprocity if you decide to move or expand.
The NASCLA exam is made up of 23 books and is a 5 ½ hour exam. There are 125 questions on this exam. However, only 115 questions count. The remaining 10 questions are potential future test questions. This means that you must get 81 of the 115 counted questions correct to pass with a score of 70%. The exam is open book, so being able to navigate the books is the most important piece to this exam. Having a quality study course is highly recommended, as studying 23 books on your own will not be efficient.
In Louisiana, the NASCLA exam will serve as the trades exam to become a commercial licensed general contractor. The LSLBC notes that the NASCLA exam is an accepted exam for Building Construction and Residential Construction.
You will need to apply for the NASCLA exam, which takes about 7 business days to return. Once receiving your application back, you can schedule your exam through PSI Exams. In Louisiana, you may complete the application before taking the NASCLA and Business and Law exam. So, you will complete the application on the front end, while you study, to get that process started.
Louisiana Business and Law Course
Most states require a Business and Law exam. However, Louisiana now offers the Business and Law as an online course rather than an exam. This is a 1-hour course that you will take through the state regulations.
Financial Statement
The Louisiana contractor application includes a financial statement that you will complete with the license application. The minimum net worth for a contractor to be eligible for a contractor’s license is $10,000. If you are planning to be licensed as an entity, you will want to fill this section out as your entity’s net worth. This means that you will need to create the entity, then transfer a cash amount of $10,000 or greater before completing the Louisiana contractor’s license application. The financial statement should be current within 12 months of the application.
Form Your Louisiana Entity
One of the Louisiana contractor’s license application requirements is to include your articles of incorporation, organization and/or partnership agreement. That means that you must have all of this done on the front end, if you plan to perform work under an entity such as an LLC, partnership, corporation etc. This is not a requirement if you are applying as an individual.
Louisiana Contractor Application Insurance
If you are applying under a commercial license, you do not need to provide proof of insurance. However, the Board requires insurance to be provided by an insurance agent if applying for a residential license.
Louisiana Contractor – Qualifying Party
You will need to complete the Qualifying Party Application as part of your application process. It is important to understand that the Qualifying Party is the individual/member that will be taking the exams. The license holder (or licensee) is the entity that the Qualifying party is a member or partner in. On the Qualifying Party Application, you will fill out a section for confirming your entity, identity information, and a list of legal questions. You will also certify a list of statements and provide a signature.
Application Fee
The application fee for a Louisiana contractor’s license is $100.00 per classification. The background financial investigation/processing fee is an additional $60.00. This cost does not include the examination fees or additional fees if your company is not located in Louisiana.
Conclusion
A Louisiana contractor’s license is a great achievement that opens numerous opportunities. It is also a requirement if you are planning to perform work over a value of $50,000.00 on commercial and industrial construction or $75,000 or more on residential construction. If you are going to launch your own general contracting company, having a license is important. There are steep penalties for performing work as an unlicensed contractor in Louisiana.