NASCLA ALL QUESTIONS WITH
COMPLETE SOLUTION.
Performance Bond - CORRECT ANSWER-Guarantees that the contractor will
complete a contract with in its time frame and conditions
Payment Bonds - CORRECT ANSWER-Guarantees subcontractors and
suppliers that they will be paid for work if they perform properly under a contract
Maintenance bond - CORRECT ANSWER-Guarantees that for stated Typically
one year no defective workmanship or material will appear in the completed
project
Completion bond - CORRECT ANSWER-Provide assurance to the financial
backers have a construction project but it will be completed on time
Fidelity bond - CORRECT ANSWER-Covers business owners for losses due to
dishonest act by there employees
Lien bond - CORRECT ANSWER-Guarantees that liens cannot be placed
against the owners property by contractors for payment of service
Sub contractors bond - CORRECT ANSWER-Protects the general contractor in
the event that subcontractors do not fully perform the contract and or pay for
labor and materials
Bank letter of credit - CORRECT ANSWER-Is not a Bond but is it cash
guaranteed to the owner it is not a guarantee of performance but can be
converted to a payment to the owner by a bank or lending institution
Bid bond - CORRECT ANSWER-Guarantees that the contractor if awarded the
job will do the work at the submitted bid price enter into a contract with the owner
and furnish the required performance and payment bonds
, What is a bond - CORRECT ANSWER-Bonds provide protection in the event that
the contractual obligation's are not met
Bond language - CORRECT ANSWER-At a minimum Bond should contain the
total dollar amount length of the bond requirements for notice of the fact or lack
of maintenance and bond enforcement
Filing procedures - CORRECT ANSWER-Construction law contractual
relationships govern the bond claims process the filing process as outlined in the
bond
Project changes - CORRECT ANSWER-Unless specifically outlined in the bonds
agreement the Surety company will not cover changes to the original contract in
most cases request for additional coverage must be made and the bonding
company must be notified of the contract changes
Payment in the event of default - CORRECT ANSWER-In the event of default
Surety may provide additional finances arrange for a new contractor or hire
subcontractors to complete the work or pay out the amount of the bond
Miller act of 1935 - CORRECT ANSWER-Current law requiring performance and
payment bond on a federal construction project value greater than $100,000
Miller act amounts - CORRECT ANSWER-50% on contracts less than 1 million
40% of contracts between one and 5 million 2.5 million payment bond for
contracts in excess of 5 million
Little Miller act - CORRECT ANSWER-Similar to the Miller act for public works
projects
Construction Industry payment protection act of 1999 - CORRECT
ANSWER-Addendum to the miller act it's purpose is to improve payment bond
protections for persons who furnish labor or material for use on federal
construction projects to help subcontractors with adequate protection
COMPLETE SOLUTION.
Performance Bond - CORRECT ANSWER-Guarantees that the contractor will
complete a contract with in its time frame and conditions
Payment Bonds - CORRECT ANSWER-Guarantees subcontractors and
suppliers that they will be paid for work if they perform properly under a contract
Maintenance bond - CORRECT ANSWER-Guarantees that for stated Typically
one year no defective workmanship or material will appear in the completed
project
Completion bond - CORRECT ANSWER-Provide assurance to the financial
backers have a construction project but it will be completed on time
Fidelity bond - CORRECT ANSWER-Covers business owners for losses due to
dishonest act by there employees
Lien bond - CORRECT ANSWER-Guarantees that liens cannot be placed
against the owners property by contractors for payment of service
Sub contractors bond - CORRECT ANSWER-Protects the general contractor in
the event that subcontractors do not fully perform the contract and or pay for
labor and materials
Bank letter of credit - CORRECT ANSWER-Is not a Bond but is it cash
guaranteed to the owner it is not a guarantee of performance but can be
converted to a payment to the owner by a bank or lending institution
Bid bond - CORRECT ANSWER-Guarantees that the contractor if awarded the
job will do the work at the submitted bid price enter into a contract with the owner
and furnish the required performance and payment bonds
, What is a bond - CORRECT ANSWER-Bonds provide protection in the event that
the contractual obligation's are not met
Bond language - CORRECT ANSWER-At a minimum Bond should contain the
total dollar amount length of the bond requirements for notice of the fact or lack
of maintenance and bond enforcement
Filing procedures - CORRECT ANSWER-Construction law contractual
relationships govern the bond claims process the filing process as outlined in the
bond
Project changes - CORRECT ANSWER-Unless specifically outlined in the bonds
agreement the Surety company will not cover changes to the original contract in
most cases request for additional coverage must be made and the bonding
company must be notified of the contract changes
Payment in the event of default - CORRECT ANSWER-In the event of default
Surety may provide additional finances arrange for a new contractor or hire
subcontractors to complete the work or pay out the amount of the bond
Miller act of 1935 - CORRECT ANSWER-Current law requiring performance and
payment bond on a federal construction project value greater than $100,000
Miller act amounts - CORRECT ANSWER-50% on contracts less than 1 million
40% of contracts between one and 5 million 2.5 million payment bond for
contracts in excess of 5 million
Little Miller act - CORRECT ANSWER-Similar to the Miller act for public works
projects
Construction Industry payment protection act of 1999 - CORRECT
ANSWER-Addendum to the miller act it's purpose is to improve payment bond
protections for persons who furnish labor or material for use on federal
construction projects to help subcontractors with adequate protection
