Colorado Enacts P3 Bonding Requirements
Bill Provides Additional Protections for Workers, Businesses and Taxpayer Money
April 18, 2019, Washington, D.C. ? Colorado Governor Jared Polis has now signed SB 138 into law. The bill amends Colorado law to clarify that current surety bonding requirements for public construction projects apply to public-private partnership construction projects.
?Requiring surety bonds on P3 construction projects greatly reduces the risk of leaving taxpayers on the hook in the event of a contractor default, ensures projects are completed, and protects subcontractors, suppliers and workers,? says SFAA President Lee Covington. ?When surety bonding protections are in place, everyone wins.?
P3s provide a new method of financing for public infrastructure projects. A P3 is a way for governments and agencies to access the capital market, but the construction risk remains the same. Research shows more than one out of four contractors fail. Surety bonds significantly increase the likelihood that a construction contract will be completed, and that subcontractors, suppliers and workers will be paid. No matter the project delivery method, surety bonds help public agencies assess and minimize their risk.
For more information on the value of surety bonds, visit www.surety.org.
The Surety & Fidelity Association of America (SFAA) is a trade association of more than 425 insurance companies that write over 98 percent of surety and fidelity bonds in the U.S. SFAA is licensed as a rating or advisory organization in all states and it has been designated by state insurance departments as a statistical agent for the reporting of fidelity and surety experience.