The SBA Bond Guarantee Program is a valuable resource for contractors who may face difficulty getting bonded in the standard market. Here is a brief overview of the requirements for obtaining bonds through the program. Keep in mind that every contractor's situation is unique, so it's important to contact our bond specialist for a comprehensive understanding of the requirements as they relate to your situation and to begin the process.
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Requirements for Eligibility:
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Good character
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Reasonable expectation of successful completion
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U.S. for-profit entity with legal U.S. owners
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Eligible to do business with the federal government
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Not involved in bankruptcy - SBA eligible after final discharge
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Current on taxes and repayment agreements
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The bond amount cannot exceed the contract amount
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A bond requirement in bid/contract documents
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Maintenance terms up to 2 years - no special consideration/longer terms considered if standard/statutory
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All eligible contracts must be submitted for SBA guarantee
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No restriction on program participation length
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Ineligible bond types: bid bonds where the project has bid, substantially or completed projects, stand-alone maintenance, subdivision, mining reclamation, commercial and fidelity bonds
Exclusions:
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Hazardous waste removal, timber sales, and projects in progress
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SBA QuickApp Requirements for Projects up to $500,000:
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2-page application
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Decisions in hours
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No financials/WIP
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No aggregate limit with SBA
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Surety establishes qualifications
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Maintenance terms up to 2 years
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Performance periods up to 1 year
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LDs up to $1,000/day
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No previous contract defaults/claims
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Up to $9 Million for Any Project:
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Federal, state, local, private, and GC projects
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Year-end business financial statements for the last 3 years
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6-month interim business financial statement if due
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Company and affiliate tax returns for the last 5 years if applicable
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Bank reference letter
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Personal financial statement
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WIP schedule
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Up to $14 Million for Federal Contracts:
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With contracting officer certification to SBA
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Year-end business financial statements for the last 3 years
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6-month interim business financial statement if due
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Company and affiliate tax returns for the last 5 years if applicable
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Bank reference letter
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Personal financial statement
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WIP schedule
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