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Government Relations - General Information (Public)

FAR Council Announces Plans to Implement New Law on Individual Surety AssetsOpen in a New Window

  FAR Council Announces Plans to Implement New Law on Individual Surety Asset 

The Federal Acquisition Regulation (FAR) Council has issued a notice that it intends to propose regulations that will implement a new law that SFAA sought to change the kinds of assets that individual sureties can pledge.  The proposal is expected to be issued in October 2017.  Under the new law, individual sureties can pledge only “eligible obligations,” which are instruments backed by the federal government, to back their bonds.  The new law also requires such assets to be deposited with the federal government.  SFAA is working with the Construction Industry Procurement Coalition (Coalition) to urge the adoption of these regulations to implement these changes in the law obtained in the FY 2016 National Defense Authorization Act.  The Coalition sent a letter to the FAR asking for action and the Coalition also persuaded Rep. Nydia Velazquez (D-NY) to ask the FAR to promulgate the necessary regulations. 

Members should visit Government Relations / General Info (Members) for more information.


 

House Approves Velázquez Measure Protecting Small Construction FirmsOpen in a New Window

News from the

House Committee on Small Business Democrats

 

 


For Immediate Release                                                                        CONTACT:  Alex Haurek

July 14, 2017                                                                                                             202-225-2361

House Approves Velázquez Measure Protecting Small Construction Firms

Washington, DC – The U.S. House of Representatives today passed an amendment offered by Rep. Nydia M. Velázquez (D-NY) aimed at providing better payment protections for small construction firms operating in the federal marketplace.  The provision, which was incorporated into a larger defense authorization bill, adds the threshold for construction contracts that must be bonded under the Miller Act as an exclusion from periodic inflation, ensuring small contractors receive financial protections they need to compete for jobs.

 

“When small firms win federal work – as either a prime contractor or a subcontractor – the result is a win-win for businesses and the taxpayer,” said Velázquez who is the top Democrat on the House Small Business Committee.  “The government receives quality goods and services at reasonable rates, while small firms are able to create good paying jobs.  Unfortunately, under current law, payment bond requirements change with inflation every five years, which reduces protections for small contractors doing federal work.”

 

For scale reasons, many small construction firms and product suppliers find their best pathway into the federal marketplace is by acting as a subcontractor to a prime contractor performing federal work.  These smaller companies are assured of receiving payment from their prime contractor through surety bonds.  Should the prime contractor fail to complete the project, the smaller subcontractor is still paid out through the bond. 

 

Unfortunately, an anachronism in federal acquisition rules subjects the dollar threshold to an inflation adjustment every five years. The result is that, every five years, fewer projects are covered under federal bonding requirements. 

 

“Certain federal acquisition thresholds should be subject to inflation adjustments, but this is not one of them,” Velázquez noted. “Ultimately, the current law results in small contractors either passing on potential contracts or taking on unsustainable risk.”

 

Velázquez’s amendment would exempt from the inflation adjustment surety bond requirements, meaning more projects would be covered.  The provision was included as part of the National Defense Authorization Act (NDAA) and adopted with bipartisan support.  With the NDAA having passed the U.S. House, the bill, and Velázquez’s amendment, now move to the Senate for consideration. 

 

Velázquez’s amendment was supported by a range of organizations including: the National Association of Surety Bond Producers; the Surety & Fidelity Association of America (SFAA); the American Institute of Architects (AIA); the American Subcontractors Association, Inc. (ASA); the Associated General Contractors of America (AGC); the Design-Build Institute of America (DBIA); the National Electrical Contractors Association (NECA); and the American Council of Engineering Companies (ACEC).

 

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U.S. House Passes the Exemption SFAA Sought to End Indexing of the Miller Act Bond ThresholdOpen in a New Window

U.S. House Passes the Exemption SFAA Sought to End Indexing of the Miller Act Bond Threshold 

SFAA and NASBP were successful in persuading the US House to exempt the federal Miller Act from the required indexing of federal acquisition thresholds for inflation. We had an amendment added on the House floor to the House National Defense Authorization Act (NDAA), the annual defense policy bill, which has been the vehicle in recent years for enactment our federal surety and procurement issues.

Members should visit Government Relations / General Info (Members) for more information.


 

Federal/State Regulatory Reports for June 2017 posted for MembersOpen in a New Window

 

Regulatory reports for June 2017 have been posted on rules affecting Commercial Surety and Contract Surety that were recently proposed or adopted.

 For Members only (or from the menu, select "Government Relations" / "Federal/State Regulations")


 

 

2017 State Public-Private Partnership LegislationOpen in a New Window

  2017 State Public-Private Partnership Legislation 
Members should visit Government Relations / General Info (Members) for more information.

 

SFAA, AIA & Local Partners Obtain Bonding Amendments in Oregon Bill for Port Authority Tollway ...Open in a New Window

  SFAA, AIA, and Local Partners Obtain Bonding Amendments in Oregon Bill for Port Authority Tollway Projects 
Members should visit Government Relations / General Info (Members) for more information.

 

Status of the State BudgetsOpen in a New Window

  Status of the State Budgets 
Members should visit Government Relations / General Info (Members) for more information.

 

Exempting the Federal Miller Act from Indexing Introduced in the HouseOpen in a New Window

Representative Nydia Velazquez (D-NY) has introduced a provision to exempt the federal Miller Act from the current indexing of federal acquisition thresholds for inflation. It was introduced as an amendment to the House version of the National Defense Authorization Act (NDAA), the annual defense policy bill. This results from the positive and cooperative effort between The Surety & Fidelity Association of America and the National  Association of Surety Bond Producers.

The NDAA has been the vehicle for enactment of provisions from the federal Construction Procurement Coalition’s legislation in the last two Congressional sessions, and the NDAA is a bill that historically passes every year.

SFAA and NASBP have worked closely with Rep. Velazquez and her staff on this issue for the past few years. She is on the House Small Business Committee and understands the impact on small contractors. The support of the Construction Coalition was key to this effort.

The House is likely to begin taking up the NDAA after the current recess.


Members should visit Government Relations / General Info (Members) for more information.

 

Multiple Government Affairs updates postedOpen in a New Window

 

Louisiana Bill for Regional Transit P3 Projects Enacted with SFAA and AIA’s Bonding Provisions 

Members should visit Government Relations / General Info (Members) for more information.

 

Nevada Enacts P3 Law with Bonding Provisions 

Members should visit Government Relations / General Info (Members) for more information.

 

New Hampshire Bond Threshold Bill Headed to Governor 

Members should visit Government Relations / General Info (Members) for more information.

 

SFAA and Local Partners in Ohio Defeat an Exemption from Current Bonding Rules 

Members should visit Government Relations / General Info (Members) for more information.

 

SFAA and AIA Moving Legislation to End Bond Threshold Indexing in Wisconsin 

Members should visit Government Relations / General Info (Members) for more information.

 

Two Bills in Wisconsin Pass to Change Public Official Bond Requirements 

Members should visit Government Relations / General Info (Members) for more information.


 

 

 

This Week in Surety & Fidelity LegislationOpen in a New Window

SFAA has replaced the monthly overview reports with the weekly legislative update on Surety & Fidelity legislation.  Reports are available for Members on the Weekly Legislative Reports page.

Members may sign up to receive email notifications by subscribing to the "Legislative-Regulatory Alert" group.


 

End of Legislative Session Reports postedOpen in a New Window



End of 2017 Legislative Session reports added for Connecticut, Louisiana, and Nevada for Members only.

Previous reports posted for 2017:  Alabama, Alaska, Arizona, Arkansas, Colorado, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kentucky, Maryland, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Mexico, North Dakota, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia and Wyoming.


Navigate to Government Relations / End of Legislative Session Reports


 

Commercial Lines Deregulation Bills Pass in New Hampshire and OregonOpen in a New Window

  Commercial Lines Deregulation Bills Pass in New Hampshire and Oregon   

SFAA and AIA have passed two commercial lines deregulation bills recently. In New Hampshire, a new law enacted under HB 150 exempts surety bonds from the rate and form filing requirements in existing law. The new law will take effect on August 1, 2017. In Oregon SB 985 would exempt surety insurance and certain other commercial lines of business for insurance from the existing law's rate and form filing requirements. The Insurance Commissioner would be granted the authority to exempt additional lines from the filing requirements. The bill has been sent to the Governor.

Members should visit Government Relations / General Info (Members) for more information.


 

U.S. House Small Business Committee Marks Up Construction Coalition Legislation on Change OrdersOpen in a New Window

  U.S. House Small Business Committee Marks Up Construction Coalition Legislation on Change Orders 

The House Committee on Small Business marked up H.R. 2594, which is the Small Business Payment for Performance Act of 2017. The legislation contains provisions on change orders from the federal Construction Industry Procurement Coalition’s bill in 2017.

H.R. 2594 would permit small businesses performing a federal construction project to request an equitable adjustment (REA) of the contract price for a unilateral change order from the federal contracting agency. The bill also provides that the federal contracting agencies must make a payment of at least 50% of the cost of the work performed as a result of the change order upon receipt of the REA and a proper invoice. The committee added a “flow down” provision that requires each small business receiving a payment under a REA to pay subcontractors and suppliers the portion that represents their costs from the change order. First tier subcontractors and suppliers must do the same.

The Coalition’s bill contains provisions that would require federal agencies to disclose their policy on payment for change orders upfront when the contract is being let so that bidders can take into consideration the timelines of the agency’s payments in preparing their bids. After discussions with the committee members, however, the bill instead requires two studies of its impact.

The bill provides that each federal agency that awards a construction contract to a small business must annually report to the Small Business Administration (SBA) regarding all contract modifications and associated REAs, but only if the change order was not finalized within 60 days. The agencies would have to identify the type of small business involved in each incident reported. The federal agencies also would have to notify the SBA when a REA is included in the contract file of a construction contract. This was an important amendment from the Democratic minority on the committee. This will gather not only information on the federal agencies’ payment practices, but also on the demographics of the small businesses being affected by agency practices on change orders.

The second report requires the SBA to submit an annual report to Congress that summarizes the reports received from the federal agencies and any concerns that they have about the process.

While the bill does not require federal agencies to disclose their practice on making payments on unilateral change orders, the agencies would be required to give the contractor advance notice of a payment under a REA so that small businesses would at least know that payment is coming within a certain timeframe. This is intended to help small contractors better manage their cash flow.

The House Small Business Committee has operated in a bipartisan manner and H.R. 2594 and all the amendments offered were approved with unanimous votes.

Members should visit Government Relations / General Info (Members) for more information.


 

Provisions Exempting Ohio DAS Projects from Procurement Rules Removed from Budget BillOpen in a New Window

  Provisions Exempting Ohio DAS Projects from Procurement Rules Removed from Budget Bill 

In Ohio, the Senate Finance Committee removed the House amendment in the budget bill that would have allowed the Ohio Department of Administration (DAS) to set its own requirements for public works projects rather than follow the regulations of the Ohio Facilities Construction Commission as now is required by law. Effectively, DAS would have had broad authority to determine whether to bond its projects. The issue may resurface in the eventual conference committee for the budget bill since this is a change to the House-passed bill.

Members should visit Government Relations / General Info (Members) for more information.


 

Monthly Comprehensive Legislative Reports posted for MembersOpen in a New Window

 

Comprehensive Legislative Reports for June 2017 (Commercial Surety; Contract Surety; Fidelity) posted for Members only.

Or navigate to any of the following:


 

Ohio Budget Amendment Would Exempt DAS Projects from the Current Procurement RulesOpen in a New Window

  Ohio Budget Amendment Would Exempt DAS Projects from the Current Procurement Rules 

HB 49 is the state budget bill.  An amendment to the bill would exempt the Department of Administrative Services (DAS) from the oversight and procurement rules of the Ohio Facilities Commission (Commission), which are applicable to all public works projects in Ohio.  Rather than following the Commission's rules, which require bonding under the Little Miller Act, the DAS could let contracts under the law’s provisions that deal with procurement of products, services, and supplies and do not require bonding of such contracts.  

Members should visit Government Relations / General Info (Members) for more information.

 

Multiple Government Affairs updates postedOpen in a New Window

 

SFAA and AIA Addressing Bond Threshold Indexing in Wisconsin

SFAA and AIA are working to eliminate the statutory indexing requirement for the Little Miller Act bond threshold in Wisconsin.  SFAA and AIA are seeking to have provisions added to the Governor’s 2017 budget bill to eliminate the indexing and freeze the bond thresholds at the current levels.  The Little Miller Act currently requires bonding at $369,000 for state projects and $148,000 for local projects.  We expect our bill to be included in the Administration’s budget bill through an amendment.

Members should visit Government Relations / General Info (Members) for more information.

 

SFAA and AIA Addressing New Hampshire Bond Threshold Bill

SFAA and AIA continue to address New Hampshire HB 371, which would increase the bond threshold from $35,000 to $100,000. The bill is in conference committee to address differences in the House and Senate regarding a provision that would have permitted political subdivisions to opt out of applying the bonding requirements for the state bond threshold.

Members should visit Government Relations / General Info (Members) for more information.

 

SFAA Successfully Addresses Little Miller Act Bills in Tennessee for 2017

SB 681 has been enacted to revise Tennessee’s Little Miller Act so that the bonds required for public construction contracts must be for a minimum of 25% of the contract price. Under prior law, the bonds had to be equal to 25% of the contract price.  SFAA also defeated legislation in Tennessee that would have increased the bond threshold from $100,000 to $200,000 for contracts let by the State Building Commission for state building projects.

Members should visit Government Relations / General Info (Members) for more information.

 

Louisiana Bill for Regional Transit P3 Projects Moving

Louisiana HB 379 would authorize the Regional Transit Authority (regional authority) to use public-private partnerships (P3) for transportation facility projects.  The regional authority would have to comply with the Department of Transportation's existing bonding requirements, which is identical to a provision SFAA and AIA obtained in a P3 law last year.  The bill passed the Senate and is pending final approval in the House.

Members should visit Government Relations / General Info (Members) for more information.

 

SFAA and AIA Addressing Oregon Bill Permitting Toll Projects for Port Authority

Oregon HB 2750, which would allow the Port of Hood River to conduct tollway projects within its district. The bill would allow private entities to own and operate the tollway in an agreement with the port.  Except for the prevailing wage laws, the bill would exempt these projects from the existing public procurement laws for construction contracts so that the Little Miller Act would not apply.  SFAA and AIA are seeking amendments to require bonding for these projects.

Members should visit Government Relations / General Info (Members) for more information.

 

Oklahoma Enacts New Public-Private Partnership Laws

In Oklahoma, two bills have been enacted to allow the State and local governments to enter into public private partnerships (P3). For state projects, SB 430 creates the Office of Public Private Partnerships and a Partnership Committee to review proposals for public projects to determine if a P3 is the best method for delivering the project. The conditions for the P3 will be set forth in the P3 agreement, which may include requirements for performance and payment bonds for all construction activities. Bonds or other security may be required under the agreement for the development or operation of the qualifying project, in the forms and amounts that are satisfactory to the responsible governmental entity. The Department of Transportation and the Turnpike Authority (Authority) are exempted from the requirements in the P3 law for state projects and can set their own requirements. For local projects, HB 1534 authorizes local governments to enter into P3s for any public project and contains the same bonding requirements as SB 430.

Members should visit Government Relations / General Info (Members) for more information.

 

Nevada P3 Bill Moving with Bonding Amendments

Nevada SB 448 would authorize counties with a population exceeding 700,000 to enter into public-private partnerships (P3) for transportation projects and social infrastructure projects for art, tourism and entertainment, including sports stadiums for use by Major League Baseball or the National Football League.  SFAA, AIA, and NASBP obtained amendments that would require performance and payment bonds in compliance with the Little Miller Act for the design and construction portion of the project.  Bonds or other security may be required in addition to these bonds if needed.

Members should visit Government Relations / General Info (Members) for more information.

 

States Consider Model Law on Notaries with Bonding Requirements

In 2017, some states have introduced bills this year to implement the Revised Uniform Law on Notarial Acts from the National Conference of Commissioners on Uniform State Law (NCCUSL).  The revised model now contains a provision that is optional for the states to enact that requires the notary to post a bond or its functional equivalent and leaves it to the state to decide the amount required.  The model gives the state agency implementing the law the authority to determine what forms of security would be accepted through regulations.  Since the 2010 revisions to the Uniform Act states have moved to incorporate the NCCUSL amendments.  In a few states, this has led to a new bonding requirement, while some states have reconsidered their bonds amounts.  Bills were considered in Idaho (HB 125/HB 209), Indiana (SB 539), Kentucky (HB 218/HB 539), Minnesota (SB 893/HB 1609), and Washington (SB 5081).

Members should visit Government Relations / General Info (Members) for more information.



 

U.S. House Small Business Committee Holding Hearing on Change OrdersOpen in a New Window

  U.S. House Small Business Committee Holding Hearing on Change Orders 

The House Small Business Committee will hold a full committee hearing on the change orders provisions from the federal Construction Industry Procurement Coalition’s bill for 2017.

Representative Don Bacon (R-NE) introduced H.R. 2350, the Small Business Know-Before-You-Bid Construction Transparency Act, on May 4. The bill would require the federal contracting agencies to participate in the federal government’s System for Award Management (SAM) or have an agency website that contains information that all members of the construction team for any project should be able to access. Copies of all payment bonds and the date and amount of each payment made to the general contractor, and any amounts withheld, are among the information that must be posted. All the items required would be available now, and this provision will assist the overworked federal acquisition staff that currently have to respond hundreds of times to requests for this information. Regarding change orders, the bill would require the agencies to disclose upfront their practices in approving changes orders such that bidders could consider the timeliness of agency payments in preparing their bids.

Representative Brian Fitzpatrick (R-PA) introduced H.R. 2594, the Small Business Pay for Performance Act, yesterday. This bill contains the requirement from the Consensus Docs, which is in the Coalition bill. It would permit contractors to submit a request for an equitable adjustment (REA) when a federal agency issues a unilateral change order. The contractor may bill the agency for work completed under the change order while the REA is pending. Once the agency receives the REA, it must pay 50% of the billed costs immediately.

There still are some negotiations underway about addressing the change order issue. We might see a requirement in the legislation for a GAO study on the practices of the federal agencies. Also under consideration is whether the agencies should report progress on REAs under the SAM, as well as progress payments.

Colette Nelson, Chief Advocacy Officer for the American Subcontractors Association will testify tomorrow on behalf of the Coalition.

Members should visit Government Relations / General Info (Members) for more information.


 

New Pennsylvania Commissioner AppointedOpen in a New Window

  New Pennsylvania Commissioner Appointed on May 23, 2017 
Members should visit Government Relations / National Association of Insurance Commissioners for more information.

 

Multiple Government Affairs updates postedOpen in a New Window

 

Indiana Increases Bond Threshold for State Educational Institutions

Indiana HB 1117 provides that contractors will not have to furnish a performance bond or a payment bond on public works contracts under $500,000 with a state educational institution if the institution agrees to waive the bond requirement.

Members should visit Government Relations / General Info (Members) for more information.

 

North Carolina Bills for Alternative School Construction Delivery Methods Starting to Move

North Carolina HB 600/SB 511 would allow local school boards enter into lease agreements with private developers for the construction of facilities.  The developer would be permitted to use both traditional procurement methods and alternative project delivery methods.  The bill provides that performance and payment bonds would be required.  In previous sessions, SFAA addressed school construction bills that contained discretionary bonding provisions.  This year, the bills were introduced with bonding requirements based on our past work in promoting bonds.

Members should visit Government Relations / General Info (Members) for more information.

 

Oklahoma P3 Bills to Create “Centers of Excellence” Moving

In Oklahoma, two bills are moving that would establish a state level and a local level P3 agency.  SB 430 would create the Office of Public Private Partnerships (OP3) and a Partnership Committee for state P3 projects and HB 1534 would authorize local governments to form a Local Partnership Committee for local P3 projects.  These entities would be charged with reviewing proposals for public projects to determine if a P3 would be the best method for delivering the project.  Both bills provide that the requirements for the P3 must be in the P3 agreement, and the OP3 will develop the requirements.  Both bills specify that the agreement could include requirements for performance and payment bonds for all construction activities.  Bonds or other security also could be required for the other portions of the project.

Members should visit Government Relations / General Info (Members) for more information.

 

SFAA Fighting Bills that Reduce Consumer Protections in Motor Vehicle Dealer Bonds

In Oklahoma, two bills are moving that would establish a state level and a local level P3 agency.  SB 430 would create the Office of Public Private Partnerships (OP3) and a Partnership Committee for state P3 projects and HB 1534 would authorize local governments to form a Local Partnership Committee for local P3 projects.  These entities would be charged with reviewing proposals for public projects to determine if a P3 would be the best method for delivering the project.  Both bills provide that the requirements for the P3 must be in the P3 agreement, and the OP3 will develop the requirements.  Both bills specify that the agreement could include requirements for performance and payment bonds for all construction activities.  Bonds or other security also could be required for the other portions of the project.

Members should visit Government Relations / General Info (Members) for more information.

 

SFAA and AIA Addressing Oregon Bill Permitting Toll Projects for Port Authority

Oregon HB 2750, which would allow the Port of Hood River to conduct tollway projects within its district. The bill would allow private entities to own and operate the tollway in an agreement with the port. Except for the prevailing wage laws, the bill would exempt these projects from the existing public procurement laws for construction contracts so that the Little Miller Act would not apply. SFAA is seeking amendments to require bonding for these projects.

Members should visit Government Relations / General Info (Members) for more information.

 

Louisiana P3 Bill for Regional Transportation Projects Moving with Bonding Provisions

Louisiana HB 379 would authorize the Regional Transit Authority (regional authority) to enter into contracts for public private partnerships (P3) for a transportation facility project.  These projects would be subject to the Department of Transportation's existing bonding requirements.  The bond provision is identical to a provision SFAA and AIA obtained in a new P3 law last year.

Members should visit Government Relations / General Info (Members) for more information.



 

New Bonding Opportunities posted for MembersOpen in a New Window


New bonding opportunities enacted in the state legislature that may be of interest to SFAA members has been posted. The report is divided by line of business: contract surety, commercial surety, and fidelity bonds. For your reference, we have included the date of enactment for each bill. SFAA updates this list periodically as new bonding opportunities are enacted. 
Access the New Bonding Opportunities now

 

Multiple Government Affairs updates postedOpen in a New Window

Washington State Increases Bond Threshold

Washington SB 5734 increases the bond threshold from $35,000 to $150,000. Under existing law, on contracts under the bond threshold, the contractor may opt for retainage in lieu of a bond. The new law reduces the amount that can be retained in lieu of a bond from 50% to 10% of the contract amount.

Members should visit Government Relations / General Info (Members) for more information.

New Law in Washington State Eliminates Bonding Alternatives for Money Transmitters and Create New Bond for Currency Exchangers

Washington SB 5031 eliminates the other forms of security that a money transmitter may furnish in lieu of a surety bond so that only the bond can be posted to meet the license bond requirements in existing law. The new law also requires online currency exchangers to post a surety bond in connection with licensure. The bond amount is based on the previous year's currency exchange dollar volume.

Members should visit Government Relations / General Info (Members) for more information.

 

Nevada P3 Bill Moving

Nevada SB 448 would authorize the State and local governments to enter into public-private partnerships (P3) for transportation projects and various kinds of social infrastructure projects, which would include sports stadiums for use by Major League Baseball or the National Football League. The public owner could include a requirement in the P3 agreement that the private partner obtain provide performance and payment bonds or other security. SFAA and AIA are seeking amendments to clarify the bonding requirements. The bill has passed the Senate.

Members should visit Government Relations / General Info (Members) for more information.

 

Bond Threshold Increase Moving in New Hampshire

New Hampshire HB 371, as amended, would increase the bond threshold from $35,000 to $100,000. The bill passed the Senate and has been sent back to the House for concurrence.

Members should visit Government Relations / General Info (Members) for more information.


 

Multiple Government Affairs updates postedOpen in a New Window

 

Indiana Bill to Increase Bond Threshold for State Educational Institutions Sent to Governor

Indiana HB 1117 provides that contractors would not have to furnish a performance bond or a payment bond on public works contracts under $500,000 with a state educational institution if the institution agrees to waive the bond requirement. As introduced, the bill dealt only with partial release subdivision bonds, and the bill now on the Governor’s desk still contains those provisions.

Members should visit Government Relations / General Info (Members) for more information.  

SFAA Addressing Little Miller Act Bills in Tennessee 

Tennessee SB 681 revises Tennessee’s Little Miller Act so that the bonds required for public construction contracts must be for a minimum of 25% of the contract price. Under prior law, the bonds had to be equal to 25% of the contract price. HB 1036/SB 884 would increase the bond threshold from $100,000 to $200,000 for contracts let by the State Building Commission for state building projects. SFAA is working to defeat the bill.

Members should visit Government Relations / General Info (Members) for more information.

Montana P3 Bill Amended with Exemption from Bonding and Other Procurement Laws

Montana SB 335, as originally introduced, would grant state and local governments the authority to use P3s for transportation and public facilities. The bill required that the P3 agreement contain specifications for the delivery of maintenance, performance and payment bonds, as well as letters of credit, in connection with the development or operation of a P3. The responsible public entity would determine the form and amount for the construction portion of the P3. SFAA and AIA have been seeking bonding amendments to clarify these provisions. The bill was amended in committee in the House so that bonding, prevailing wages, and many other requirements of the procurement code would not apply to P3s. The amended bill also eliminated authority for P3s for transportation projects and technology infrastructure. Although the bill got out of committee in the House, it appears that it may have died on the House floor.

Members should visit Government Relations / General Info (Members) for more information.

 

Colorado Bill Addressing Contractor Qualifications Moving

Colorado SB 211 provides that if contractors required to provide a bid bond can furnish the bond in the amount required by the solicitation or otherwise required by law, the Department of Transportation (DOT) would be prohibited from eliminating the contractor from consideration of an award on the basis of any financial statement that the contractor submitted for the DOT’s contractor prequalification determination process.

Members should visit Government Relations / General Info (Members) for more information.

 

Bond Threshold Bill Headed to Governor’s Desk in Washington

Washington SB 5734 would increase the bond threshold from $35,000 to $150,000. Under existing law, on contracts under the bond threshold, the contractor may opt for retainage in lieu of a bond. The bill would reduce the amount that can be retained in lieu of a bond from 50% to 10% of the contract amount. The bill has been sent to the Governor.

Members should visit Government Relations / General Info (Members) for more information.

 

States Consider Model Law on Notaries with Bonding Requirements

In 2017, some states have introduced bills this year to implement the Revised Uniform Law on Notarial Acts from the National Conference of Commissioners on Uniform State Law (NCCUSL). The revised model now contains a provision that is optional for the states to enact that requires the notary to post a bond or its functional equivalent and leaves it to the state to decide the amount required. The model gives the state agency implementing the law the authority to determine what forms of security would be accepted through regulations. Since the 2010 revisions to the Uniform Act states have moved to incorporate the NCCUSL amendments. In a few states, this has led to a new bonding requirement. This year, however, we are seeing states reconsider and increase their bonds amounts. Bills were introduced in: Idaho (HB 125/HB 209), Indiana (SB 539), Kentucky (HB 218/HB 539), Minnesota (SB 893/HB 1609), and Washington (SB 5081).

Members should visit Government Relations / General Info (Members) for more information.

 

Oklahoma P3 Bills Moving to Create “Centers of Excellence” for State and Local Projects

In Oklahoma, two bills are moving that would establish a state level and a local level P3 agency.  SB 430 would create the Office of Public‑Private Partnerships (OP3) and a Partnership Committee for state P3 projects and HB 1534 would authorize local governments to form a Local Partnership Committee for local P3 projects.  These entities would be charged with reviewing proposals for public projects to determine if a P3 would be the best method for delivering the project.  Both bills provide that the requirements for the P3 must be in the P3 agreement, and the OP3 will develop the requirements.  Both bills specify that the agreement could include requirements for performance and payment bonds for all construction activities.  Bonds or other security also could be required for the other portions of the project. 

Members should visit Government Relations / General Info (Members) for more information.

 

New Hampshire Bond Threshold Bill Moving with Lower Threshold Increase

New Hampshire HB 371, as amended, would increase the bond threshold from $35,000 to $100,000.  Originally, the bill would have increased the threshold to $150,000, but passed the House with an increase to $75,000.  An agreement was reached in the Senate to increase the threshold to $100,000 and remove provisions that would have permitted political subdivisions the option of applying the state bond threshold. 

Members should visit Government Relations / General Info (Members) for more information.


SFAA Fighting Bills that Reduce Consumer Protections in Motor Vehicle Dealer Bonds in Oregon

SFAA and AIA are opposing bills in Oregon that would reduce consumer protection under motor vehicle dealer bonds. SB 974 would remove the cap on claims from non-retail customers and HB 2975 provides for awards of penalties attorneys’ fees. HB 3323 increases the bond amount from $40,000 to $100,000, which could reduce the bond’s availability.

Members should visit Government Relations / General Info (Members) for more information.

 

SFAA Defends Bail Bonds in the States

SFAA is opposing legislation that essentially make bail bonds the option of last resort by establishing pretrial services programs, permitting the use of unsecured personal bonds, or by permitting partial cash deposits to be posted in lieu of bail bonds. We have argued that these bills would restrict a useful tool for the State to ensure the defendant’s appearance in court. We currently are addressing bills in California, Connecticut, Maine, and Texas.

Members should visit Government Relations / General Info (Members) for more information.



 

Multiple Government Affairs updates postedOpen in a New Window

 

Kansas Enacts Bonding Requirements for Public-Private Partnerships

Kansas SB 55 requires contractors to provide performance and payment bonds for a public private partnership for public construction projects exceeding $100,000.

Members should visit Government Relations / General Info (Members) for more information.

 

Virginia Enacts Bill Permitting Waiver of Prequalification Requirements

Virginia HB 2017 revises the law for non-transportation construction contracts that exceed $100,000 and are less than $500,000, which requires contractors to be prequalified under the existing law's standards when bonds are waived. The new law allows local governments to waive prequalification requirements in limited cases when the contract amount is more than $100,000 but less than $300,000 when bonds are waived. The waiver provisions expire on July 1, 2021.

Members should visit Government Relations / General Info (Members) for more information.

 

SFAA Opposes California Bail Bill

SFAA has submitted written testimony in opposition to California AB 42/SB 10, which would eliminate the current system for posting bail bonds and replace it with a pretrial services program in which defendants are evaluated through a risk assessment for whether they should be released prior to a trial.  If a judge or magistrate determines that pretrial release, with or without conditions, will not reasonably assure the appearance of the defendant in court, the judge or magistrate would have to set monetary bail at the least restrictive level necessary.  If the judge has required monetary bail, the defendant could post an unsecured appearance bond, a secured appearance bond, or a deposit equal to a percentage of the monetary bail amount.

Members should visit Government Relations / General Info (Members) for more information.

 

Arkansas Governor Signs P3 Bill

Arkansas SB 651 authorizes the State and its agencies to enter into public-private partnerships (P3) for public building and public facility projects. The Arkansas Economic Development Commission and the Arkansas Development Finance Authority will be required to promulgate regulations jointly to establish guidelines for P3s, including the comprehensive P3 agreement. The regulations have to include guidelines regarding bonding requirements. SFAA will address the regulations when proposed.

Members should visit Government Relations / General Info (Members) for more information.

 

SFAA Opposes Bill to Eliminate Surety Bail in Maine

SFAA has submitted written testimony in opposition to Maine HB 880, which would require the development and use of a risk assessment instrument for determining appropriate pretrial release conditions. The bill would eliminate the use of bail bonds as a condition of releasing a defendant in cases where the judicial officer has determined that personal recognizance or an unsecured bond will not ensure reasonably the defendant’s appearance.

Members should visit Government Relations / General Info (Members) for more information.

 

Federal Construction Industry Procurement Reform Coalition Bill Starts in the House in 2017

The federal Construction Industry Procurement Reform Coalition (Coalition) has a bill for 2017 that contains two surety provisions. One would eliminate the indexing of the Miller Act bond threshold for inflation every five years. The other contains payment protections for subcontractors and suppliers that work under a public-private partnership (P3) on a federal project. This provision applies to P3s on land that the federal government owns, and such P3s would be subject to bonding under the federal Miller Act. It is a first step toward requiring the design and construction portion of P3s to be bonded.

Change orders in federal contracts is the key issue for the contractor groups in this year’s Coalition bill. Contractors are increasingly frustrated with the slow approval of change orders and the resulting lack of timely payment. The Coalition bill would require agencies to disclose their policy for responding to a contractor’s request for an equitable adjustment of the contract price for a unilateral change order from the agency, and in particular, to disclose if it is the agency’s policy bundle all change orders for resolution at the end of the project, which is the current practice of some federal agencies. The Federal Acquisition Regulations (FAR) require a response for an equitable adjustment to be in “the shortest practicable time.” The Coalition bill would trigger the collection of data on the federal agency response times, as well as provide contractors with information needed to properly respond to a request for bids. The Coalition bill also contains a provision from the Consensus Docs that would require federal agencies to make an interim payment of at least 50% of the equitable adjustment requested in a unilateral change order. SFAA’s Contract Bond Advisory Committee reviewed the change order issue and agreed that anything that will shorten the approval of change orders also will benefit the sureties.

The Coalition has drafted a House and Senate version of the bill. The Senate bill contains all the provisions of the Coalition’s bill and it is geared toward making amendments to the government-wide FAR. The House version focuses on small business issues, so it is a narrower version that includes only the change order provisions. The House bill would revise the Small Business Act. Both bills are written to foster greater transparency by providing contractors with needed information about an agency’s procurement practices so that they can make better informed business decisions when bidding on government contracts.

Members should visit Government Relations / General Info (Members) for more information.


 

Legislation for Public-Private Partnerships Pending in Several StatesOpen in a New Window

Legislation for Public-Private Partnerships Pending in Several States
Members should visit Government Relations / General Info (Members) for more information.

Government Relations - General Info (Public)

Item Name Posted By Date Posted
US Dept. of Labor accepts SFAA proposed ERISA form PDF (198.39 KB)  more ] Administration 3/3/2017
SFAA and AIA Working with Indiana Attorney General PDF (81.72 KB)  more ] Administration 2/23/2016
Bond Waiver Bill Resurfaces in Cuyahoga County, OH PDF (156.11 KB) Administration 2/9/2016
Wisconsin - New Draft of Surety Indexing Bill ... PDF (142.4 KB)  more ] Administration 1/27/2016
Proposed Bonding Amendments for Federal Water ... PDF (142.93 KB)  more ] Administration 1/27/2016
Oklahoma - Transportation & Public Facility P3... PDF (156.37 KB)  more ] Administration 1/27/2016
Congress and States Start to Convene 2016 Sessions PDF (166.5 KB)  more ] Administration 1/7/2016
President Signs Two Surety Provisions into Law PDF (149.47 KB)  more ] Administration 11/30/2015
Final Congressional Conference Report on NDAA ... PDF (149.44 KB)  more ] Administration 9/30/2015
President Signs 3-Month Extension to Highway Act PDF (149.84 KB) Administration 8/3/2015
US House Makes First Move on Extending Highway ... PDF (163.37 KB)  more ] Administration 7/15/2015
Congress Gives VA Construction Short Term Patch PDF (38.06 KB) Administration 6/18/2015
IL Bond Form for Commercial Drivers License Test.. PDF (95.59 KB)  more ] Administration 6/12/2015
Federal Construction Coalition Procurement ... PDF (108.85 KB)  more ] Administration 6/9/2015
Nevada Adjourns - Update on Key Surety Legislation PDF (108.66 KB) Administration 6/9/2015
New York $500,000 Bond Threshold Bill to be Heard PDF (108.55 KB) Administration 6/8/2015
Construction Coalition Bill Introduced in Senate PDF (109.15 KB) Administration 6/5/2015
Congress Extends Funding for VA Hospital Project.. PDF (108.96 KB)  more ] Administration 5/26/2015
Congress Heads to Recess without a Solution to ... PDF (121.69 KB)  more ] Administration 5/21/2015
Short Term Extension Likely for Highway Trust Fund PDF (110.28 KB) Administration 5/21/2015
Connecticut Nullum Tempus Bill Passes Legislature PDF (109.32 KB) Administration 5/20/2015
SFAA Comments on Commerce Dept. Bond Waivers ... PDF (95.65 KB)  more ] Administration 5/19/2015
Bills to Transfer Control of VA Construction ... PDF (94.18 KB)  more ] Administration 4/30/2015
Connecticut Nullum Tempus Bill Amended Favorably PDF (96.38 KB) Administration 4/7/2015
New Commercial Surety Bond Opportunity Passes ... PDF (95.5 KB)  more ] Administration 3/31/2015
Sureties in Iowa Fight Bond Waiver PDF (95.62 KB) Administration 3/18/2015
CT Nullum Tempus Bill to be Heard in Committee PDF (109.05 KB) Administration 3/4/2015
SFAA Participates in Joint Trade Comments on ... PDF (62.65 KB)  more ] Administration 2/12/2015
US House Small Business Subcommittee Hearing... PDF (1.17 MB)  more ] Administration 2/12/2015
Congress Enacts New Bond Requirement for ... PDF (50.72 KB)  more ] Administration 1/5/2015
Infrastructure Bills Are Moving in New Jersey PDF (65.83 KB) Administration 12/19/2014
Threshold for Payment Security under Miller Act PDF (64.75 KB)  more ] Administration 12/12/2014
Surety Issues in Congress Wait Until Next Year PDF (54.55 KB) Administration 12/11/2014
Summary of Mid-Term Election Results PDF (50.47 KB) Administration 11/5/2014
Treasury Dept. Issues Final Rules on Sureties ... PDF (65.06 KB)  more ] Administration 10/22/2014
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