[Code of Federal Regulations]

[Title 48, Volume 1]

[Revised as of October 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 48CFR28.102-2]



[Page 551-552]

 

            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM

 

                CHAPTER 1--FEDERAL ACQUISITION REGULATION

 

PART 28_BONDS AND INSURANCE--Table of Contents

 

           Subpart 28.1_Bonds and Other Financial Protections

 

Sec. 28.102-2  Amount required.



    (a) Definition. As used in this subsection--

    Original contract price means the award price of the contract; or, 

for requirements contracts, the price payable for the estimated total 

quantity; or, for indefinite-quantity contracts, the price payable for 

the specified minimum quantity. Original contract price



[[Page 552]]



does not include the price of any options, except those options 

exercised at the time of contract award.

    (b) Contracts exceeding $100,000 (Miller Act).

    (1) Performance bonds. Unless the contracting officer determines 

that a lesser amount is adequate for the protection of the Government, 

the penal amount of performance bonds must equal--

    (i) 100 percent of the original contract price; and

    (ii) If the contract price increases, an additional amount equal to 

100 percent of the increase.

    (2) Payment bonds. (i) Unless the contracting officer makes a 

written determination supported by specific findings that a payment bond 

in this amount is impractical, the amount of the payment bond must 

equal--

    (A) 100 percent of the original contract price; and

    (B) If the contract price increases, an additional amount equal to 

100 percent of the increase.

    (ii) The amount of the payment bond must be no less than the amount 

of the performance bond.

    (c) Contracts exceeding $25,000 but not exceeding $100,000. Unless 

the contracting officer determines that a lesser amount is adequate for 

the protection of the Government, the penal amount of the payment bond 

or the amount of alternative payment protection must equal--

    (1) 100 percent of the original contract price; and

    (2) If the contract price increases, an additional amount equal to 

100 percent of the increase.

    (d) Securing additional payment protection. If the contract price 

increases, the Government must secure any needed additional protection 

by directing the contractor to--

    (1) Increase the penal sum of the existing bond;

    (2) Obtain an additional bond; or

    (3) Furnish additional alternative payment protection.

    (e) Reducing amounts. The contracting officer may reduce the amount 

of security to support a bond, subject to the conditions of 28.203-5(c) 

or 28.204(b).



[65 FR 46070, July 26, 2000]