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CSLB Press Release - 01/25/2006

Contractors Board and Partners Target Construction Sites in Three Counties for Enforcement Sweeps

Coalition goes after state's multi-billion dollar underground economy problem


SACRAMENTO — Santa Clara County, San Diego County and Los Angeles County were the latest targets for the California State Contractors Board (CSLB) and it's partners in the Economic and Employment Enforcement Coalition (EEEC). The Coalition is going after California's huge illegal underground economy that thrives in industries like construction, farming, garment and restaurants. The Contractors Board's partnering agencies are the Department of Industrial Relations, Division of Occupational Safety and Health (Cal/OSHA), Division of Labor Standards Enforcement (DLSE) and the Employment Development Department (EDD).

In this latest series of sweeps, the partnered teams visited over 80 different construction sites around the State last Wednesday, Thursday, Friday and Saturday (Jan. 18, 19, 20, 21) that resulted in scores of violations and close to $200,000 in potential fines. They interviewed workers, managers, owners, and safety officers and checked the businesses' paperwork. The sweep of these construction sites targeted businesses that avoid labor, tax and licensing laws to gain a competitive advantage over the almost 300,000 legitimate contractors who follow the law.

The underground economy is fueled in part by unlicensed contractors who also prey upon consumers. It's estimated that California loses anywhere from $60 and $140 billion a year in revenue that could be going towards schools, roads and law enforcement instead of lining the pockets of lawbreakers.

"We're all affected by contractors who break the law. Not only do they take business away from legitimate business people, they're putting consumers at risk," said CSLB Registrar Steve Sands. "If a consumer has a problem, there's very little that can be done to help them. Plus, if a worker gets hurt while on their property, the consumer could be responsible for paying the medical bills."

The sweeps resulted in the following:

Santa Clara County - (Jan. 21-22) Inspections were made at 65 sites with a total of 507 workers. Citations and violations totaled 68 with $110,550 in projected fines and penalties.
San Diego County - (Jan. 19-20) There were approximately 25 inspection stops from Jan. 19-20 in the Chula Vista. CSLB investigators report that during this sweep not one single operator had a valid Contractor's License. 13 Citations were issued with potential fines of up to $41,650. Violations included non-licensed contracting, cash pay to workers, and no worker's compensation insurance.
Downey - (Jan 18) Four inspections were made as a follow-up on a consumer tip. Two individuals were given citations for non-licensee violations. They were also charged with violation labor code laws for cash payment and no workers compensation insurance. Assessed penalties could add up to $35,500.

Sweeps in San Luis Obispo, Santa Barbara, San Bernardino, Riverside and Tulare counties last year netted about 300 violations and over three-quarters of a million dollars in potential fines. The real success of these ongoing operations will be with the impact they have on bringing individuals and employers into the honest business world.

The Contractors State License Board operates under the umbrella of the California Department of Consumer Affairs. The CSLB licenses and regulates California's 292,000 contractors, and investigates more than 20,000 complaints against contractors annually. In fiscal year 2004-05, the CSLB helped consumers get more than $36 million in restitution.