"All businesses or individuals who construct or alter any building, highway, road, parking facility, railroad, excavation, or other structure in California must be licensed by the California Contractors State License Board (CSLB) if the total cost (labor and materials) of one or more contracts on the project is $500 or more. Contractors, including subcontractors, specialty contractors, and persons engaged in the business of home improvement (with the exception of joint ventures and projects involving federal funding) must be licensed before submitting bids. Licenses may be issued to individuals, partnerships, corporations, or joint ventures."
and:
6. What happens if I contract without a license?
"A contractor's license is not necessary as long as you advertise yourself as a nonlicensed contractor, provide your customer with a written statement that you are unlicensed (see Question 3), and never contract for jobs costing more than $500, including labor and materials.
The Contractors State License Board has established statewide investigative teams that focus on unlicensed contractors and the underground economy. These units conduct stings and sweeps to curtail illegal contracting activities.
Contracting without a license is a misdemeanor. Unlicensed contractors face potential sentences of up to one year in county jail and potential administrative fines of from $200 to $15,000. The CSLB filed more than 1,600 citations and brought 1,000 criminal actions against unlicensed contractors during the 1997-1998 fiscal year. Stings and sweeps are routinely publicized to ensure maximum consumer education."
The above was snipped from: CALIFORNIA CONTRACTORS LICENSE LAW AND REFERENCE BOOK 2000
