Performance & Payment Bond Application (Performance Plus) Bond - Statewide in All States
Table of Contents
Brief Summary
The size of the contract decides what you post. On federal construction work over $150,000 you owe both a performance bond and a payment bond, each normally equal to 100 percent of the contract price. Between $35,000 and $150,000 the contracting officer picks the payment protection. This application sets your bonding capacity so the bonds are ready when you win the job.
This is the contractor's application for performance and payment bonds on construction contracts. Under the federal Miller Act and FAR 28.102, a federal construction contract over $150,000 requires both bonds, normally at 100 percent of the original contract price. Public owners at the state and local level have their own bonding laws, and private owners set bond terms in the contract.
We can help with all All States bonds!
How to Apply for a Performance & Payment Bond Application (Performance Plus) Bond:
- Complete the contractor bond application for the company and its owners.
- Provide company financial statements and a current work in progress schedule.
- List completed projects with contract amounts and owner references.
- Sign the surety's general indemnity agreement.
- Send the bid documents and contract for each job so the surety can review the terms and required bond forms.
- Deliver the executed performance and payment bonds to the owner before the notice to proceed.
Detailed Information About the All States Performance & Payment Bond Application (Performance Plus) Bond:
The tier you fall in
Federal construction bonding is set by contract size, under 40 U.S.C. 3131 and FAR 28.102.
**Over $150,000.** FAR 28.102-1 requires both a performance bond and a payment bond. Under FAR 28.102-2 the performance bond equals 100 percent of the original contract price unless the contracting officer finds a lesser amount adequate. The payment bond equals 100 percent of the original contract price unless the contracting officer finds that impractical in a written determination, and it can never be less than the performance bond. If the contract price goes up, the bond amounts must go up by the same amount.
**Over $35,000 up to $150,000.** No performance bond is required by the Miller Act. The contracting officer selects two or more payment protections, such as a payment bond, an irrevocable letter of credit, a tripartite escrow agreement or certificates of deposit, and you furnish one of them. The amount is 100 percent of the original contract price unless the contracting officer finds a lesser amount adequate.
Forms and timing
Federal agencies use Standard Form 25 for the performance bond and Standard Form 25A for the payment bond, as listed in FAR 28.106-1. FAR 28.102-1(c) requires the bonds before you receive a notice to proceed or start work.
State, local and private projects
Most states and many cities have their own public works bond laws with their own thresholds and forms. Private owners and general contractors write bond requirements into the contract. In every case, follow the bid documents and confirm the bond forms with the owner before the bonds are issued.
What this application does
This application is not a bond for a single job. The surety reviews your company, sets a bonding line, and then issues performance and payment bonds for each contract you are awarded.
How the premium is set
Premium is charged on the contract price. The rate depends on the surety's review of your financial statements, working capital, backlog, experience and the size and type of the job.
Eligibility and Requirements for an All States Performance & Payment Bond Application (Performance Plus) Bond:
- Federal jobs over $150,000: performance bond and payment bond, each normally 100 percent of the original contract price.
- Federal jobs over $35,000 up to $150,000: payment protection selected by the contracting officer.
- SF 25 and SF 25A on federal contracts, or the owner's own forms on other work.
- A surety acceptable to the owner, which on federal work means a surety approved by the Treasury.
- Bond amounts increased when the contract price increases.
All States Performance & Payment Bond Application (Performance Plus) Bond FAQs:
Over $150,000, the performance and payment bonds each normally equal 100 percent of the original contract price under FAR 28.102-2. The contracting officer can accept a lower performance bond if it finds that adequate.
Above $35,000, the contracting officer chooses two or more payment protections, such as a payment bond or letter of credit, and you supply one. No Miller Act performance bond is required at that size.
On federal work, before you get a notice to proceed or start work, under FAR 28.102-1(c).
No. It is the application the surety uses to set your bonding capacity. Each contract gets its own bonds.
The contract price, your financial statements and working capital, your backlog and your experience with similar work. The surety quotes after reviewing the application.
