[Code of Federal Regulations]
[Title 13, Volume 1]
[Revised as of January 1, 2007]
From the U.S. Government Printing Office via GPO Access
[CITE: 13CFR115.63]

[Page 194]
 
                TITLE 13--BUSINESS CREDIT AND ASSISTANCE
 
                CHAPTER I--SMALL BUSINESS ADMINISTRATION
 
PART 115_SURETY BOND GUARANTEE--Table of Contents
 
            Subpart C_Preferred Surety Bond (PSB) Guarantees
 
Sec.  115.63  Allotment of guarantee authority.

    (a) General. SBA allots to each PSB Surety a periodic maximum 
guarantee authority. No SBA guarantee attaches to bonds approved by a 
PSB Surety if the bonds exceed the allotted authority for the period in 
which the bonds are approved. No reliance on future authority is 
permitted. An allotment can be increased only by prior written 
permission of SBA.
    (b) Execution of Bid Bonds. When the PSB Surety Executes a Bid Bond, 
SBA debits the Surety's allotment for an amount equal to the guarantee 
percentage of the estimated penal sum of the Final Bond SBA would 
guarantee if the Contract were awarded. If the Contract is then awarded 
for an amount other than the bid amount, or if the bid is withdrawn or 
the Bid Bond guarantee has expired (see Sec.  115.12(c)), SBA debits or 
credits the Surety's allotment accordingly.
    (c) Execution of Final Bonds. If the PSB Surety Executes a 
guaranteed Final Bond, but not the related Bid Bond, SBA debits the 
Surety's allotment for an amount equal to the guarantee percentage of 
the penal sum of the Final Bond. SBA will debit the allotment for 
increases, and credit the allotment for decreases, in the bond amount.
    (d) Release and non-issuance of Final Bonds. The release of Final 
Bonds upon completion of the Contract does not restore the corresponding 
allotment. If, however, a PSB Surety approves a Final Bond but never 
issues the bond, SBA will credit the Surety's allotment for an amount 
equal to the guarantee percentage of the penal sum of the bond. In that 
event, the Surety must notify SBA as soon as possible, but in no event 
later than 5 business days after the non-issuance has been determined. 
Until the Surety has so notified SBA, it cannot rely on such credit.