Current through Register Vol. 54, No. 49, December 7, 2024
Section 81.135 - Terms of surety bond guarantees(a)Terms.(1) An applicant for a surety bond guarantee may request and receive a guarantee of no more than 90% of bid and performance bonds, provided by a surety company approved by the Commonwealth, which are needed to obtain a contract with a Commonwealth agency or contractor. The guarantee may not be in an amount greater than $50,000.(2) An applicant for a surety bond guarantee shall provide security, collateral and personal guarantees in the form and amount necessary to reasonably assure payment in the event of default or bankruptcy. The collateral shall include a contract in the amount of the guarantee which contract shall be assigned to the Authority.(b)Bid bond guarantee. If approved by the Board, an applicant for a bid bond guarantee shall receive a guarantee which permits the applicant to bid on contracts with Commonwealth agencies or contractors for 1 year, except an applicant who fails to submit a bid for a contract for 6 consecutive months shall forfeit the right to the guarantee and funds set aside for that purpose shall be returned to the Authority's surety bond guarantee fund.(c)Performance bond guarantee. If approved by the Board, an applicant for a performance bond guarantee shall receive a guarantee conditioned upon the actual receipt of a contract with a Commonwealth agency or contractor within 6 months of the Board's approval of the guarantee. Applicants receiving conditional approvals on performance bond guarantees shall submit current financial statements to the Authority prior to the guarantee closing.The provisions of this § 81.135 adopted February 6, 1987, effective 2/7/1987, 17 Pa.B. 634.The provisions of this § 81.135 issued under section 9 of the Pennsylvania Minority Business Development Authority Act (73 P.S. § 390.9).