SENATE BILL REPORT

SB 5439

BYSenators Newhouse and Fleming

Providing a waiver for contractor's bonds.

Senate Committee on Economic Development & Labor

Senate Hearing Date(s):February 20, 1989

Senate Staff:Charles Woods (786-7452)

AS OF FEBRUARY 17, 1989

BACKGROUND:

Contractors engaged to perform work for any state, county or municipal entity must provide a bond, with two or more sureties, guaranteeing that the contractor will satisfactorily complete the contract and pay all laborers, mechanics, subcontractors and materialmen.  For contracts less than $25,000, at the contractor's option, the public entity may waive the bonding requirement and retain 50 percent of the contract as security.

SUMMARY:

For contracts of $15,000 or less, at the contractor's option, the public entity may waive bonding requirements and establish its own alternative procedures to guarantee reasonable assurance of performance.  The public entity must find that substantial economic hardship on the part of the contractor warrants such action.

Appropriation:    none

Revenue:    none

Fiscal Note:      none requested