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municipalauthorities.org │ 63 track record. Why is it important to release bonds? Contractors often bid on multiple projects, knowing they'll only secure some. Authorities usually have 60 days after bids open to award contracts and keep the bonds of the two lowest bidders until then. Because it's uncertain which projects a contractor will win, surety companies typically cap the total (aggregate) value of projects a bidder can pursue. If authorities postpone releasing bonds to contractors who did not win a project, it can limit those contractors' chances to seek new work while they wait. These hold-ups may also harm the authority itself by shrinking the number of companies willing to bid on future public projects in the area, since some contractors might choose not to participate in later requests from the same authority. Is it hard to qualify for bonding and can a new or unbonded contractor get bonded? Answering this question can be complex, as bonding depends on factors like contract size, scope, financing, location, terms, and more. Start by consulting a reputable agent who works with multiple surety companies; they can streamline the process and help gather required information. How much does a bond cost? Surety companies usually provide bid bonds at no charge. Before submitting a bid, however, contractors should be aware of the costs for performance, payment, and possibly maintenance bonds. Bond rates differ based on several factors—including the contract's type and size, the principal’s financial status, and their prior experience. Typically, these rates are calculated as a percentage of the contract or bond value. As you can tell, the world of surety bonding can be complex. However, with a better understanding of the protections various bonds offer, it is Understanding Surety bonds article continued from page 33. gdfengineers.com RESILIENT INFRASTRUCTURE SYSTEMS Gwin, Dobson & Foreman – Designing For A Complex Future easier to determine which options are right for you. Keep in mind that laws and regulations applicable to authorities and municipalities can differ. It is therefore essential to consult your solicitor to ensure proper compliance, particularly regarding requirements set by funding sources and applicable codes. With the proper bonds in place and knowing how and when to leverage them, you are well on your way to ensuring your projects are neither shaken nor stirred. S About PennBid A PMAA-endorsed program, PennBid is the region’s leader in e-procurement programs. Provided at absolutely no cost to public agencies and design/consulting firms, PennBid has opened doors for many to take advantage of electronic procure- ment tools. For more information about PennBid or to arrange an overview of the program, visit our website at www. pennbid.net .