On Thursday, December 11, Cuyahoga County, Ohio’s County Council released a long-awaited Disparity Study regarding contracting within the County. This study recommends the following:
Recommendation 12: Performance Bonds
Cuyahoga County should respond to the perceived burden of performance bonds on SBE and MWBE firms by breaking performance bonds into “phases”. This would keep firms from having to get such large bonds all at once. Also, GSPC recommends interplay with the federal SBA bonding program which will provide relief to small businesses. Another mechanism is to raise the threshold of when performance bonds are necessary to a dollar amount to be determined by the County Council. The County might also consider discouraging primes from requiring performance bonds from subcontractors for jobs that are less than a dollar amount to be determined by the County Council. The County could also undertake to entertain waivers for performance bonds. Firms could prequalify for such a waiver.”
NASBP previously dealt with this issue in the summer of 2013. That year the County Council introduced Ordinance 2013-0018 to amend the County code. This ordinance appears to repeal performance and payment bonds as required by the County code and allows the Director of Public Works, with the approval of the Director of Law, discretion when applying bonds on a contract-by-contract basis.
The issue was tabled by Committee on Public Works, Procurement and Contracting Chair Pernel Jones until after the disparity study was released. Now that this study has been made public, it is expected the county will pursue this issue again in the New Year.
This issue will be addressed on
Thursday, December 18 at NASBP’s Government Relations Town Hall webinar by Lou Colagrossi of Dawson Insurance and one of NASBP’s State Government Affairs Representatives. This webinar will be the first true “webinar” hosted by NASBP using Adobe Connect technology.
Registration is free, but required.