bookmark_borderSFAA Newsletter posted – May/June 2018 Edition

The 2018 May/June Edition of the SFAA Newsletter has been posted.  Beginning this year, each Newsletter will be available to the public. In addition to our regular Association news, we will be providing original content for our members and supporters to share. In this issue, we have an in depth article on Occupational Licensing.

(for non-Members)

(for Members only)


bookmark_borderIllinois Proposed Rules for Insurance Company Bonds Contain Provisions SFAA Sought

Illinois Proposed Rules for Insurance Company Bonds Contain Provisions SFAA Sought 

The proposed rules that the Illinois Department of Insurance has issued contain provisions implementing changes SFAA has long sought to make the bonds required for insurance companies to cover their employees and officers more workable. The proposed rules would eliminate the minimum discovery period in the bond and would instead require the coverage to be on a “discovery basis.” The proposed rules also would change the required bond amount so that it would be based on the guidance in the National Association of Insurance Commissioners Financial Condition Examiners’ Handbook. Currently, the bond amount is based on the amount of admitted assets of the company (as determined from year to year) filed with the Department in the company’s annual statement.

Members should visit Government Relations / General Info (Members) for more information.


bookmark_borderSFAA Working on Oklahoma Bill that Prohibits Retainage When Bonds are in Place

 SFAA Working on Oklahoma Bill that Prohibits Retainage When Bonds are in Place 

SFAA and AIA are working with the local surety association in Oklahoma to address HB 2676, which would prohibit the withholding of retainage from the general contractor on public buildings and public works projects if bonds under the Little Miller Act are in place. Oklahoma’s bond threshold is $50,000, and existing law provides that not more than 5% of the contract price may be withheld. For subcontractors, the bill provides that either retainage of not more than 5% may be withheld or performance and maintenance bonds could be required as a condition of the subcontract.

Members should visit Government Relations / General Info (Members) for more information.


bookmark_border2017-2018 Bond Obligee Guide updated

This guide is designed to serve obligees who may want to verify the
authenticity of surety bonds that they are being asked to accept. The
most reliable way to authenticate a surety bond is to contact the
issuing surety company directly. However, it is often difficult to
ascertain the correct address, telephone number or person to contact at
the surety.

Accordingly, this guide contains a list of SFAA surety
company members that have volunteered to be included together with
information as to how they can be contacted for the purposes of
authenticating a bond. Since participation in this program is voluntary,
not every surety company is listed.

Verify Your Bond – Bond Obligee Guide


bookmark_borderSFAA Addressing Proposed Bond Threshold Increase and P3 Pilot Program in Vermont

 SFAA Addressing Proposed Bond Threshold Increase and P3 Pilot Program in Vermont 

SFAA is addressing HB 917, which would increase the bond threshold from $100,000 to $500,000.  As drafted, the bill would have provided for a $1 million bond threshold.  The bill also would provide for a pilot program for the Agency of Transportation to enter into public-private partnerships (P3s) for transportation infrastructure projects.  The state legislature would set the requirements and would have to approve each P3 project, unless the project will have a project lifetime cost that is less than $2 million or the project has been approved in the most recently adopted Transportation Program.  The bill does not specify a bonding requirement for this P3 program.  The program would expire on July 1, 2023.

Members should visit Government Relations / General Info (Members) for more information.


bookmark_borderIndiana Bill to Require Bonding in P3s Goes to Study

Indiana Bill to Require Bonding in P3s Goes to Study 

Indiana HB 1301, as introduced, contained the amendments that SFAA drafted to require the design and construction portion of P3s to be bonded in Indiana. Our bonding amendments were part of the Insurance Department’s bill, and would have required 100% bonds, just as the Indiana Little Miller Act requires for any other project. In the House Insurance Committee, the bill was amended to require 50% payment and performance bonds, and on second reading on the House floor, the bond amount was further reduced to 25% before it later passed the House. It was not possible to reach an agreement to move HB 1301 forward in the Senate. It is likely that the issue of bonding on P3 projects in Indiana will be sent to a summer study committee, which is where the issue was last summer.

Members should visit Government Relations / General Info (Members) for more information.