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The U.S. Small Business Administration announced today two important changes to its Surety Bond Guarantee (SBG) Program that will increase contract opportunities for small contractors, supporting them to grow their business operations. The changes will become effective on September 20, 2017.

The SBA will increase the guarantee percentage in the Preferred Surety Bond Program from no more than 70 percent to no more than 90 percent.

The SBA’s guarantee will be 90 percent if the original contract amount is $100,000 or less, or if the bond is issued to a small business that is owned and controlled by socially or economically disadvantaged individuals, veterans, service disabled veterans, or certified HUBZone and 8(a) businesses. All other guarantees will be 80 percent.

The eligible contract amount for the Quick Bond Application (Quick Bond) will increase to $400,000 from $250,000.

The Quick Bond is a streamlined application process, with reduced paperwork requirements, that is used in the Prior Approval Program for smaller contract amounts. SBA’s review and approval requires minimal time, allowing small businesses to bid on and compete for contracting opportunities without delay.

Through its SBG Program, consisting of the Prior Approval and the Preferred Surety Bond Programs, the SBA guarantees bid, payment and performance bonds for contracts that do not exceed $6.5 million, and up to $10 million with a federal contracting officer’s certification.

The SBA’s guarantee encourages the surety company to issue a bond that it would not otherwise provide for a small business.

https://www.constructionequipment.com/sba-makes-changes-its-surety-bond-program

SBA Makes Changes to its Surety Bond Program