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2006 SESSION
068738472Be it enacted by the General Assembly of Virginia:
1. That §§ 2.2-4336 and 2.2-4337 of the Code of Virginia are amended and reenacted as follows:
§ 2.2-4336. Bid bonds.
A. Except in cases of emergency, all bids or proposals for
construction contracts in excess of $100,000 $500,000 shall be accompanied by a bid bond from a surety company
selected by the bidder that is authorized to do business in Virginia, as a
guarantee that if the contract is awarded to the bidder, he will enter into the
contract for the work mentioned in the bid. The amount of the bid bond shall
not exceed five percent of the amount bid.
B. No forfeiture under a bid bond shall exceed the lesser of (i) the difference between the bid for which the bond was written and the next low bid, or (ii) the face amount of the bid bond.
C. Nothing in this section shall preclude a public body from
requiring bid bonds to accompany bids or proposals for construction contracts
anticipated to be less than $100,000 $500,000.
§ 2.2-4337. Performance and payment bonds.
A. Upon the award of any (i) public construction contract
exceeding $100,000 $500,000 awarded to any prime contractor or (ii) construction
contract exceeding $100,000 $500,000
awarded to any prime contractor requiring the performance of labor or the
furnishing of materials for buildings, structures or other improvements to real
property owned by a public body, the contractor shall furnish to the public
body the following bonds:
1. Except for transportation-related projects, a performance bond in the sum of the contract amount conditioned upon the faithful performance of the contract in strict conformity with the plans, specifications and conditions of the contract. For transportation-related projects, such bond shall be in a form and amount satisfactory to the public body.
2. A Except for
transportation-related projects, a payment bond in the sum of the
contract amount. The bond shall be for the protection of claimants who have and
fulfill contracts to supply labor or materials to the prime contractor to whom
the contract was awarded, or to any subcontractors, in furtherance of the work
provided for in the contract, and shall be conditioned upon the prompt payment
for all materials furnished or labor supplied or performed in the furtherance
of the work.
"Labor or materials" shall include public utility services and reasonable rentals of equipment, but only for periods when the equipment rented is actually used at the site.
B. Each of the bonds shall be executed by one or more surety companies selected by the contractor that are authorized to do business in Virginia.
C. If the public body is the Commonwealth, or any agency or institution thereof, the bonds shall be payable to the Commonwealth of Virginia, naming also the agency or institution thereof. Bonds required for the contracts of other public bodies shall be payable to such public body.
D. Each of the bonds shall be filed with the public body that awarded the contract, or a designated office or official thereof.
E. Nothing in this section shall preclude a public body from
requiring payment or performance bonds for construction contracts below $100,000 $500,000.
F. Nothing in this section shall preclude the contractor from requiring each subcontractor to furnish a payment bond with surety thereon in the sum of the full amount of the contract with such subcontractor conditioned upon the payment to all persons who have and fulfill contracts that are directly with the subcontractor for performing labor and furnishing materials in the prosecution of the work provided for in the subcontract.