Surety Bond Encyclopedia

Utility Contractor (Individual Permit) Bond - Statewide in Minnesota

Brief Summary

This is the bond a utility contractor posts for one permitted job inside MnDOT trunk highway right of way. There is no statewide schedule to guess from. The amount is whatever your permit's special provisions say, so the quote is built around your permit, and the executed form carries your permit number, highway and county so MnDOT can match it to the work.

When MnDOT issues a utility permit for work on trunk highway right of way, the Commissioner of Transportation may require the utility or its contractor to furnish security under Minnesota Rules 8810.3300, subpart 5. For a single project that security can be a surety bond on MnDOT's Utility Permit (Individual Bond) form, with the State of Minnesota and the Commissioner of Transportation as obligee. The bond amount is written into the special provisions of the permit.

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How to Apply for a Utility Contractor (Individual Permit) Bond:

Find the bond amount in the special provisions of your MnDOT utility permit.
Have the utility permit number or numbers, type of installation, trunk highway number and county ready for the form.
Confirm with MnDOT whether the utility owner or your contracting company should be named as principal.
Complete the bond application and review the quote.
Have the surety and principal sign MnDOT's Utility Permit (Individual Bond) form.
Deliver the executed bond as the MnDOT permit office directs.

Detailed Information About the Minnesota Utility Contractor (Individual Permit) Bond:

The amount comes from your permit

Minnesota Rules 8810.3300, subpart 5 lets the commissioner of transportation require the utility, or its contractor, to furnish a certified check, a surety bond or a corporate undertaking in favor of the State of Minnesota. When a deposit is required, the rule says the amount shall be specified in the special provisions of the permit. Two jobs on the same highway can carry different figures, so read your permit before asking for a quote.

Individual bond or continuing bond

MnDOT publishes two utility surety bond forms. The Individual form is for work on one project and lists the utility permit number or numbers, the type of installation, the trunk highway number and the county. The Continuing form sets up an ongoing bond on file that covers all utility permits by a single company, and MnDOT keeps a Continuing Bond Report naming the utility owners and contractors that carry one. If your company already appears on that report, ask the MnDOT permit office whether the continuing bond covers the job before buying an individual bond.

What the bond promises

Under the individual form, the principal agrees to satisfactorily perform the work required under the permit, satisfactorily restore the highway right of way, and bear the costs of engineering supervision and repair of damage. The rule describes the security as covering expense the state incurs repairing damage to trunk highway right of way caused by the work. Claims have a time limit. The form says no action may be brought after one year following the date the principal ceased work under the permit.

Who is on the bond

The obligee is the State of Minnesota and the Commissioner of Transportation. The principal is the party MnDOT requires to furnish security, which under the rule can be the utility owner or the contractor doing the work. Both the surety and the principal sign the form.

Eligibility and Requirements for a Minnesota Utility Contractor (Individual Permit) Bond:

Obligee: the State of Minnesota and the Commissioner of Transportation.
MnDOT Utility Permit (Individual Bond) form, revision 1-2009.
Bond amount matching the figure in the permit's special provisions.
Coverage tied to the listed utility permit numbers for one project.
Claims barred after one year following the date the principal ceased work under the permit.

Minnesota Utility Contractor (Individual Permit) Bond FAQs:

How much is the bond?

There is no single statewide figure. Minnesota Rules 8810.3300, subpart 5 says that when a deposit is required, its amount is specified in the special provisions of the permit. Your permit is the source for the number.

Our company already has a continuing bond with MnDOT. Do we need this one too?

MnDOT's continuing bond form establishes an ongoing bond on file that covers all utility permits by a single company. MnDOT publishes a Continuing Bond Report listing the utility owners and contractors that carry one. Check that report and confirm with the permit office before buying an individual bond for the same work.

Can the contractor post the bond instead of the utility?

Yes. The rule lets the commissioner require the utility, or its contractor, to furnish the security. Which party MnDOT wants on a given permit is something to confirm with the permit office.

How long does the surety stay exposed after the job?

The individual bond form says no action may be brought after one year following the date the principal ceased work under the permit.

Can I give MnDOT a check instead?

The rule accepts a certified check, a surety bond or a corporate undertaking. If a check is used, any money left over after the state's repair expense is returned to the applicant.