A commercial contractor's license classification allows work up to $150,000 per project. The contractor bids on a $175,000 project. What action is required?
Correct Answer
A) Must upgrade license classification
The contractor must upgrade to a higher license classification that allows projects exceeding $150,000 before bidding on or performing the $175,000 project.
Why This Is the Correct Answer
Option A is correct. A contractor's license classification establishes the maximum project value they are authorized to undertake. To legally bid on or perform work exceeding that limit, the contractor must obtain a higher license classification from the Louisiana State Licensing Board for Contractors (LSLBC) before proceeding. Performing work beyond the licensed scope is a violation of Louisiana contractor licensing law.
Why the Other Options Are Wrong
Option B: Must obtain special project permit
Option B (obtain a special project permit) is not a recognized mechanism under Louisiana contractor licensing law. There is no 'special project permit' that allows a contractor to exceed their classification limit on a one-off basis. The proper remedy is upgrading the license classification.
Option C: Must partner with higher-classified contractor
Option C (partner with a higher-classified contractor) may be a practical business arrangement in some contexts, but it does not automatically authorize the under-classified contractor to bid or perform the work. Louisiana law requires the contractor of record to hold the appropriate classification for the project value.
Option D: May proceed with current license
Option D (may proceed with current license) is incorrect and legally dangerous. Proceeding with a $175,000 project under a $150,000 classification limit would constitute unlicensed contracting for that scope, exposing the contractor to license suspension, fines, and civil liability.
Memory Technique
Think of a license classification like a speed limit: if the limit is $150,000 and you're going $175,000, you're speeding. The fix is not a special pass — it's getting a license for the higher speed (upgrading your classification).
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