Building Contractor ($10,000) Bond - City of Mountain Brook, AL in Alabama

Brief Summary

In Mountain Brook the $10,000 contractor bond is part of getting licensed, not something you sort out after the first job. A premium buys the bond, the city clerk approves it, and your business is cleared to build in the city.

Section 109-5 of the Mountain Brook code requires anyone in the business of constructing buildings, houses or other structures in the city, or digging the excavations for them, to get the proper license and deposit a $10,000 bond with the city clerk. The bond must be executed by a corporate surety authorized to do business in Alabama.

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How to Apply for a Building Contractor ($10,000) Bond:

• Apply for the Mountain Brook license that covers building or excavation work.
• Get the council approved bond form from the city clerk.
• Buy a $10,000 bond from a corporate surety authorized in Alabama, naming the City of Mountain Brook.
• Make sure the business name on the bond matches the license application.
• Submit the signed bond to the city clerk for approval.
• Keep the bond in force for as long as you do construction work in the city.

Detailed Information About the Alabama Building Contractor ($10,000) Bond:

Who has to post it

The requirement is broad. Section 109-5 applies to any person engaged in the business of constructing buildings, houses or any other structures in Mountain Brook, and to anyone making the excavations for them. It is one flat amount of $10,000 with no tiers by contract size or license class.

What the bond guarantees

The bond is conditioned on your faithful observance of all laws, ordinances, rules and regulations that govern construction and related excavation in the city. It must indemnify the City of Mountain Brook and hold it harmless from claims arising from your acts or omissions or those of your agents and employees, including unfaithful or inadequate work, and it promises that all work will be done in a good and workmanlike manner.

Filing with the city clerk

The city council establishes the form and substance of the bond, and a copy of the form is kept in the city clerk's office. The bond goes to the clerk for approval and stays in the clerk's custody. Getting the clerk's form before your surety issues the bond avoids a rejected filing.

Cancellation

The bond stays in force until 30 days after the city clerk receives written notice that the surety intends to cancel. Liability that accrued before that date remains covered.

A second instrument some projects need

The license bond is not the only security Mountain Brook may ask for. Under Section 109-46, certain projects seeking a soil disturbance permit also need a reclamation bond, letter of credit or other approved security, sized by the building official. That applies to work in the Villages of Mountain Brook, in community shopping districts, on projects with a development plan, on recent subdivisions of three or more lots, and on homes with an estimated construction cost over $3,000,000. It is posted per project by the owner or agent and does not replace the $10,000 contractor bond.

What it costs

You pay an annual premium rather than the full $10,000. The surety sets that premium based on credit and business history, so a quote is the quickest way to see your number.

Eligibility and Requirements for a Alabama Building Contractor ($10,000) Bond:

• Flat bond amount of $10,000.
• Corporate surety authorized to do business in Alabama.
• City of Mountain Brook as obligee on the form set by the city council.
• Filing with and approval by the city clerk.
• Owner credit review by the surety to set the premium.

Alabama Building Contractor ($10,000) Bond FAQs:

Official and Additional Resources for the Alabama Building Contractor ($10,000) Bond: