by: Cobb Law Group
It’s coming soon! August 15 is a big day for small construction contractors and subcontractors! According to the U.S. Small Business Administration’s Surety Bond Guarantee Program, smaller construction contractors will have improved access to bonds.
First, there is a new, streamlined application process which simplifies the existing SBG program paperwork for construction contracts of $250,000 or less. The new form combines two existing forms, the SBA Form 994 (Application for Surety Bond Guarantee Assistance) and the SBA Form 990 (Surety Bond Agreement), and it eliminates the reference to SBA Form 994C.
In a second bit of good news, SBA will no longer require the principal to complete and submit two other forms for these small contract amounts, SBA Form 994F (Schedule of Work in Process) and SBA Form 413 (Personal Financial Statement).
According to the American Subcontractors Association, “Paperwork burdens have real dollar costs that can deter participation in any federal program, especially for smaller dollar value transactions, which magnify the costs associated with the paperwork burdens.” The Cobb Law Group is proud to be a part of the American Subcontractors Group (“ASA”) and applaud the ASA for its efforts in supporting this new streamlined process.
If you are a small construction contractor, we would enjoy hearing how this new application process is likely to affect your business. Please leave a comment below!
This is a general information article and should not be construed as legal advice or a legal opinion. The content above has been edited for conciseness and additional relevant points are omitted for space constraints. Readers are encouraged to seek counsel from a construction lawyer for advice on a particular circumstance.