California Raised the Penalties for Unlicensed Contracting in 2026

As of July 1, 2026, hiring or working as an unlicensed contractor in California got a lot more expensive. Senate Bill 779 raised the minimum civil penalty for unlicensed contracting from $200 to $1,500, with fines running as high as $15,000 for straightforward unlicensed activity and up to $30,000 for willful violations, aiding unlicensed work, or knowingly contracting with someone who isn't licensed. If you're planning a remodel, addition, or new build in Orange County, here's what actually changed and why it matters to you, not just to contractors.

What SB 779 Changed

Before this law, the Contractors State License Board could issue a minimum civil penalty of $200 for unlicensed contracting, a number that had barely moved in years and did little to discourage the practice. SB 779 rewrites that floor entirely:

• Minimum penalty: $1,500 (up from $200) for unlicensed contracting activity
• Maximum penalty: up to $15,000 for standard unlicensed contracting violations
• Higher tier: $1,500 minimum up to $30,000 maximum for willful disregard of building laws, aiding or abetting unlicensed contracting, or knowingly entering into a contract with an unlicensed contractor
• Built-in increases: the CSLB must adjust these minimums for inflation every five years, so this floor won't sit still like the old one did

The law also increases minimum penalties for other license law violations to $500 in most cases, on top of the unlicensed-contracting tier above.

Why This Matters If You're Hiring, Not Just If You're Contracting

SB 779 is aimed at unlicensed operators and the people who knowingly enable them, not at homeowners acting in good faith. But the practical risk to you as a homeowner was always bigger than the fine anyway, and this law is a good reminder of why. When you hire someone without a valid CSLB license:

• You lose access to the Contractors State License Board's Recovery Fund, which can reimburse homeowners for certain losses caused by a licensed contractor's fraud or incompetence. Unlicensed work has no equivalent safety net.
• There's no license bond backing the work, and often no proof of active liability insurance or workers' compensation, meaning you can be on the hook if someone is injured on your property.
• Permits typically can't be pulled properly, which creates real problems at resale, appraisal, and insurance claim time.

The higher penalties simply raise the cost of getting caught for the other side of that transaction. Your protection was always tied to hiring licensed in the first place.

How to Verify a License Before You Sign Anything

This takes two minutes and should happen before you get anywhere near a contract:

• Go to cslb.ca.gov and search the contractor's license number or business name directly.
• Confirm the license status shows "Active," not expired, suspended, or revoked.
• Check that the classification matches your project (a C-27 landscaping license isn't the right fit for a kitchen remodel, for example).
• Confirm current bond and workers' compensation insurance are on file, both shown on the same lookup page.

Any legitimate contractor expects you to do this and will have their license number printed on their bids, business cards, and contracts without being asked. If a contractor is reluctant to give you a license number, or their story about why they're "between licenses" sounds reasonable, that reluctance is the actual answer to your question.

What to Do With This Information

If you're getting bids for a remodel this year, add one line to your process: verify the license number at CSLB before you compare a single dollar figure. A low bid from an unlicensed operator isn't a bargain, it's a bill you haven't received yet, and as of this year the person who wrote that bid is exposed to real financial consequences for it. That's a signal worth paying attention to, not just a legal footnote.

For a deeper look at what else separates a legitimate contractor from a risky one, see our guide on contractor red flags and credentials and how to find a reliable contractor in Orange County.