Advocacy - Position Briefs

Broadband Equity, Access, and Deployment (BEAD) Program Surety Bond Information Kit 

07-03-2024 02:29 PM

The National Association of Surety Bond Producers (NASBP) and The Surety & Fidelity Association of America (SFAA) have prepared the Broadband Equity, Access, and Deployment (BEAD) Program Surety Bond Information Kit, including bond forms, to address the announcement of the National Telecommunications & Information Administration (NTIA) of the U.S. Department of Commerce to allow surety bonds as an alternative form of security to letters of credit (LOCs) for the Broadband Equity Access and Deployment (BEAD) Program. Visit the NASBP webpage that provides bond forms and model language in Word and PDF formats. 

In November of 2023, NTIA issued a programmatic waiver to modify the requirement for LOCs as the sole means of security to secure the performance by recipients of BEAD grant funds to construct broadband infrastructure. After NTIA’s waiver announcement, NASBP and SFAA formed a surety working group to develop performance bond forms and model language to facilitate the use of surety bonds to meet BEAD Program security requirements. The surety working group developed two different performance bond forms; model language for state broadband offices to insert into award agreements; and a sample letter template to provide state broadband offices with initial information about an internet service provider’s (ISP) or its construction contractor’s “bondability.”

Of the two bond forms, one bond form addresses situations when the ISP can qualify for bonding and furnishes the bond directly to the state broadband office. The second bond form addresses situations where the contractor to the ISP that is building out the broadband system is better suited to qualify for bonding.

As a hallmark of public procurement, surety bonds are widely used and accepted forms of performance security. They provide viable options for qualified companies that receive federal grant monies for the development of broadband infrastructure and that wish to offer a form of security other than a bank LOC.

The BEAD Program Surety Bond Information Kit is available to download here for free.

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NASBP BEAD Program_Full Kit final.pdf   648 KB   1 version
Uploaded - 07-03-2024