§ 78-41. Bond requirements for construction contracts

Contracts entered into by the county hospital district shall contain requirements sufficient to cover any financial liability incurred by the hospital district if a contractor withdraws their bid or proposal or fails to perform in accordance with his contract. These conditions include the following:

(1) For contracts under $25,000.00, the invitation for bids or request for proposals may require the contractor to furnish a good and sufficient bid bond or cashier's check in the amount of five percent of the total contract price but not less than $1,500.00. This is to be furnished with the response. In addition, the invitation for bids or request for proposals may provide that no money is paid to the contractor until completion and acceptance of the work.

(2) The invitation for bids or request for proposals for contracts over $25,000.00 shall require the vendor to furnish a good and sufficient bid bond or cashier's check in the amount of five percent of the total contract price. This is to be furnished with the response or contract.

(3) For contracts over $25,000.00, the prime contractor shall be required to furnish a good and sufficient performance bond in the amount of 100 percent of the total contract price. This is to be done at the award of the contract. Failure to do so shall cause the hospital district to file a claim against the bid bond.

(4) For contracts over $25,000.00, a payment bond in the amount of 100 percent of the contract price shall be required for the prime contractor. This is to be done at the execution of the contract. Failure to do so shall cause the hospital district to file a claim against the bid bond.

(5) For contracts between $25,000.00 and $50,000.00, a performance bond may not be required if a single payment is stipulated to be made upon completion and acceptance of the work. This determination is at the discretion of the hospital district.

(6) All bonds must be executed with a surety company authorized to do business in the state and approved by the hospital district.

(7) Cashier's checks/bid bonds will be returned as soon as possible after the prime contractor has executed the contract. If no award has been made within 90 days of the bid or proposal opening date, vendors may demand the return of their checks/bonds. If a vendor has been notified that he is one of two vendors selected to execute the contract if the prime contractor defaults on that contract, he may not demand the return of his check/bond until the prime contractor executes the contract.

(Ord. No. 99-1076, 6-8-1999)