§3131 Bonds of Contractors of Public Buildings or Works

Summary

Before the federal government gives a contract over $100,000 to build, change, or repair a public building or public work, the contractor must provide two bonds that start when the contract is awarded. One is a performance bond with a surety the contracting officer accepts and in an amount the officer thinks is enough to protect the government. The other is a payment bond to protect people who supply labor or materials. The payment bond normally equals the total contract price unless the officer, in writing with specific reasons, sets a different amount. The payment bond cannot be smaller than the performance bond. The performance bond must also cover taxes the government collects or withholds from workers’ wages. The government must give the bond’s surety written notice about unpaid taxes within 90 days after the contractor files the tax return, or no later than 180 days after the return was due. The government cannot sue the bond for those taxes unless it gives that notice and brings suit within one year after the notice. A contracting officer may waive the bonds for work done in a foreign country if it is impractical to get them. The officer can also require more or different bonds if needed. Contractor: the person who wins the contract.