SEC. 112. SURETY BONDS.
(a) MAXIMUM BOND AMOUNT.— Section 411(a)(1) of the Small Business Investment Act of 1958 (15 U.S.C. 694b(a)(1)) is amended by striking ‘‘$2,000,000’’ and inserting ‘‘$5,000,000”.
Most if not all government contracts require a bond for performing the contracted work or service. That is to provide a pool of funds that can be used if the contractor is unable to supply the service.
This is the current text of the section of the Small Business Investment Act of 1958.
Text (click here)
(a) Authority of Administration to guarantee surety against loss from principal's breach of bond (1) The Administration may, upon such terms and conditions as it may prescribe, guarantee and enter into commitments to guarantee any surety against loss resulting from a breach of the terms of a bid bond, payment bond, performance bond, or bonds ancillary thereto, by a principal on any contract up to $2,000,000.
And this is listed in the Jobs Bill as well.
(e) (2) the total contract amount at the time of execution of the bond or bonds exceeds $2,000,000,
These are the rest of the provisions of the jobs act for this section:
(b) DENIAL OF LIABILITY.— Section 411(e)(2) of the Small Business Investment Act of 1958 (15 U.S.C. 694b(e)(2)) is amended by striking ‘‘$2,000,000’’ and inserting ‘‘$5,000,000”.
(c) SUNSET.— The amendments made by subsections (a) and (b) of this section shall remain in effect until September 30, 2012.
(d) FUNDING. — There is appropriated out of any money in the Treasury not otherwise appropriated, $3,000,000, to remain available until expended, for additional capital for the Surety Bond Guarantees Revolving Fund, as authorized by the Small Business Investment Act of 1958, as amended.
This section of the bill is to promote small business and facilitate its ability to compete where they are prohibited from competing due to their ability to be insured to a standard by 'let's say' a BID for work by a city for a bridge.
This section provides HELP for Small Business to give them a let up. Their liability limits will increase with this help and therefore cannot be oppressed from achieving their potential.
It's a good idea because from here when Small Business is able to achiever higher liability limits they will and should continue to achieve higher liability limits because their increased income from the bigger and more lucrative contracts will set them on a new path.
There is a sunset provision to this OPPORTUNITY, which is September 30, 2012. This 'help' does not go on forever and that is a good thing.
There are about 180 pages to the bill. This provision is on Page 10. If I cover a minimum of 6 pages a day I can be done in a month while keeping up with current events. It also gives me a chance to prepare for the next section.
It is Saturday, company is expected about 3:00 PM so I am going to end here and continue sometime tomorrow.
The next section is:
TITLE II – PUTTING WORKERS BACK ON THE JOB WHILE REBUILDING AND
SUBTITLE A – VETERANS HIRING PREFERENCES