The SBA Surety Program provides assistance much the same way as the SBA Loan Guarantee Program. The size standards have increased to sales of $33,500,000 for Building Contractors, Highway, Street, and Bridge Construction, etc. and $14,000,000 for Specialty Trade Contractors, such as Masonry, Drywall, Painting, HVAC, Electrical, etc., averaged over the most current 3 years. Eligible contract size has increased to $5,000,000 and in some cases up to $10,000,000.
The process for a business, is to begin by contacting an agent/surety that participates in the program and provide the required information to an underwriter for determining the following:
- Does the small business qualify for SBA Assistance?
- What additional information is needed to complete an underwriting file?
- Is the information in a format (financial statements) that is acceptable to the surety/SBA?
- Will the principal's experience be adequate to support the request bond or surety program?
- What bank support is available to the business?
- The specific information needed to complete an underwriting file?
- Depending on the type and size of bonds required of the business, any special information that might be needed to supplement the application;
Upon receipt, the agent/surety will provide the business with access to the SBA web site with the process to requesting specific bonds.
The time required from start to actually receiving a bond will depend on the quality and completeness of information but normally, shouldn't take over 3-5 working days after a complete file is submitted.
The bond cost is based on performance and payment bonds (no cost for bid bonds) and consists of two charges;
- SBA requires a check in the amount of $7.29/thousand of the contract amount; If the contract is $100,000, this check would be in the amount of $729.
- The surety's premium is $25 per thousand of contract amount on the first $500,000 of contract and $15/$1,000 for the next $2,000,000 and $10/$1,000 for the next $2,500,000;
To get started, please click here and complete an SBA Form 912 for each owner, officer, director and an SBA Form 994 from the link below:
http://www.sba.gov/tools/Forms/smallbusinessforms/contractingsuretybonding/index.html
For SBA Financial Assistance forms, please click the link below:
http://www.sba.gov/tools/Forms/smallbusinessforms/fsforms/index.html
Once we've established a program for your firm, you'll be provided "Login" information, for submitting future bond requests online.
All fees are due prior to issuing the performance and payment bonds. |
