ATTACHMENT_B_Bond_Instructions.pdf

BID, PERFORMANCE & PAYMENT SECURITY REQUIREMENTS

for

VENDORS & CONTRACTORS

These Bid, Performance and Payment Security requirements apply to vendors and contractors doing business with the School Board of Pinellas County, Florida (the District) and should be reviewed by your insurance agent when preparing your securities. They apply to Bid Security, Performance Bonds, Supply Bonds and Labor and Material Payment Bonds. In the event of a conflict between these requirements and the front end specifications or Special Conditions, the front end specifications or Special Conditions will take precedence. ALL REQUIREMENTS

CONTAINED HEREIN ARE DEEMED TO BE MATERIAL REQUIREMENTS BY THE DISTRICT.

I. GENERAL GUIDELINES APPLICABLE TO ALL BONDS

In order not to delay the review and validation process of a bond, please be sure to follow the below guidelines carefully:

A. The surety company must hold a certificate issued by the State of Florida authorizing it to write surety bonds in Florida.

B. Each Bid Bond, Performance Bond, Supply Bond or Labor and Materials Payment Bond shall identify the

School Board of Pinellas County, Florida as owner and the specific project for which the bond(s) is submitted.

C. The printed name and title of the various persons signing or countersigning the bond should appear on the line below the person’s signature.

D. All persons signing the bond should use their full legal name. To facilitate the licensure verification process, licensed insurance agents should sign using their full first name, full middle name and last name.

E. The agent signing the bond must hold a current Power of Attorney from the surety company issuing the bond.

F. A copy of such Power of Attorney must be attached to the bond which shall contain no restrictions preventing payment and should specify the city and state where the agent is located.

G. All bonds must be signed or countersigned by an insurance agent who holds a valid Florida 2-20 or 9-20 General Lines Property Casualty Insurance license (F.S. 624.425).

H. All bonds should be signed or countersigned prior to the bid opening date and time.

II. SPECIFICATIONS FOR ALL BONDS

A. For projects of $500,000 or more bid value:

The surety company shall be rated "A" or better as to policy holder ratings and "5" or better as to financial ratings by the current edition of the Best Rating Guide.

B. For projects less than $500,000 bid value:

The surety company may be rated less than “A-5” by the current edition of the Best Rating Guide as long as the following conditions contained in F.S. 287.0935 are met:

1. The surety company produces evidence that it has twice the minimum surplus and capital required by the Florida Insurance Code on the date the invitation to bid was issued

2. The surety company produces evidence that it holds a currently valid license and is otherwise in compliance with the provisions of the Florida Insurance Code.

3. The surety company produces evidence that said surety company holds a currently valid certificate of authority issued by the United States Department of the Treasury under S.S. 31 United States Code 9304-9308.

The documentation specified in paragraphs II(B)(1-3) must be provided within one (1) business day upon request if it is not initially attached to the bond. Failure by the vendor or contractor to supply this documentation shall result in rejection of an otherwise acceptable bid.

III. TYPES OF SECURITIES

A. BID SECURITY

1. AMOUNT OF BID SECURITY:

Unless otherwise specified in the front end specifications or special conditions, the bid security shall be in the amount of 5% of the amount of the base bid.

2. ACCEPTABLE FORMS OF BID SECURITY:

Bond Currency Certified Bank Check or Bank Certified Company Check Cashier’s Check Money Order Irrevocable Letter of Credit

3. BID SECURITY REVIEW & APPROVAL:

B. The bid security must always be submitted along with the sealed bid package. Bids not including the required Bid Security will be rejected at the bid opening. Bid Securities will not be reviewed for acceptability at the time of the public bid opening. Following the bid opening, all Bid Securities will be examined for compliance with these guidelines. District staff will make a reasonable effort to verify key information. However, if information cannot be readily verified, the bond may be declared unacceptable.

Bids with unacceptable Bid Security will be rejected and declared ineligible for further consideration.

1. RETURN OF BID SECURITY:

The bid security, other than bonds, will be deposited into an escrow account until the contract has been awarded to the lowest responsible and responsive bidder. The bid security of the (2) lowest responsible and responsive bidders shall be retained until such time as the contract has been executed by the lowest bidder and all required bonds have been received and determined to be acceptable. Bid security from all other bidders, other than bonds, will be returned in the form of a School Board check immediately following the award of the contract by the Board. Bid Bonds will only be returned upon request.

C. PAYMENT, PERFORMANCE OR SUPPLY SECURITY

1. AMOUNT OF PAYMENT, PERFORMANCE OR SUPPLY SECURITY:

Unless otherwise specified in the front end specifications or special conditions, the performance security shall be in the amount of 100% of the awarded, fixed contract amount or the total estimated value of the awarded contract, whichever is applicable. Bond coverage must automatically expand to include the value of all change orders which may be incorporated during the course of the project.

2. ACCEPTABLE FORMS OF PAYMENT, PERFORMANCE OR SUPPLY SECURITY:

Bond U.S. Currency Certified Bank Check or Bank Certified Company Check Cashier’s Check Money Order Irrevocable Letter of Credit

3. TIME LIMIT REQUIREMENTS:

When a bidder is awarded a contract by the District, the awardee shall receive written notice of award either from the Purchasing Department or from the Facilities Department. Within (10) calendar days of the issuance date of the notice of award, the awardee shall furnish to the Purchasing Department or Facilities Department, acceptable bonds as required by the bidding documents. Upon receipt of this acceptable documentation, the Purchasing Department will issue a purchase order or the Facilities Department will issue both a signed contract and a purchase order as authorization to proceed, and the awardee shall begin the performance of the contract. In the event the District determines the surety company providing the bonds is unsatisfactory or the bonds are inadequate to cover performance of the work, the awardee shall, at his expense, within five (5) working days after receipt of notice from the District, furnish bonds in such form, amount, and with a surety acceptable to the District. Upon failure to do so, the awardee shall forfeit the bid security as liquidated damages.

4. PURPOSE OF PERFORMANCE AND LABOR & MATERIAL PAYMENT BONDS:

The Performance and Labor and Material Payment bonds shall guarantee faithful performance and completion of the contract, and the payment by the awardee of all claims of all persons or corporations for work done or materials or equipment furnished in connection with the work incorporated with this contract.

For construction projects or projects involving installation of equipment, these bonds shall be executed as a warranty bond for a period of at least one (1) year following the District’s final acceptance of the completed project, guaranteeing compliance in accordance with the technical specifications.

(bidsec.dot) mar .5/.25/1/1 (Rev. 9/27/99)