Guiding Business Principles of the Past Are A Strong Foundation for Success Today 

I look back on my career and recall the first client that I was fortunate to work with when I started here at JDW Insurance. It was 1985. One of the premier general contractors in this region wanted to bid a job for about $12 million (nice size project in those days). His agent, who was not well versed in surety, declined the bid hours before the bid was due. This, of course, created my opportunity, and the contractor and I have worked together ever since. This “trusting relationship” has created numerous referred accounts that I also have handled for many years. Control of this client’s company has been passed from the original owner to his son, and the company continues to prosper and to remain a client. The framework for their success was built on principles and a code of ethics my client established in 1971, the year the company was founded. After 40 years, their principles still prevail, and I want to share just a few of these with you:

1. Never try to hide a mistake. Once discovered, seek the help of all to try to rectify the problem.
2. Do not buy equipment you do not need.
3. Know on a monthly basis how each job is doing.
4. Never keep people on the payroll hoping a job will come. Make tough decisions including laying staff off, when necessary.
5. Never bid a job just to keep people busy. There is only one reason for bidding a job and that is to make a fair profit.
6. Consider all options and make decisions promptly.
7. There are times when problems go beyond your ability. Seek the help of those around you who have learned from experience.

These statements still hold true today. Many contractors may be tempted to toss aside these principles from the pressures of today’s economy, but I believe those who follow guiding principles similar to my client’s listed above will survive this economic cycle.

NASBP Successes

While I am speaking of reaping the rewards of dedication, I wanted you to be aware of how NASBP’s perseverance and hard work has yielded success with regard to two important industry issues. First, with an unprecedented collaboration of state procurement officials, local governments, accounting groups, such as the American Institute of Certified Public Accountants (AICPA), and many design and construction associations, including the Associated Builders & Contractors, Inc. (ABC), American Institute of Architects (AIA), American Subcontractors Association, Inc. (ASA), American Council of Engineering Companies (ACEC), Construction Financial Management Association (CFMA), National Electrical Contractors Association (NECA), and National Society of Professional Engineers (NSPE), to name a few, we saw the repeal of the 3% Withholding Tax Law on government contracts. It was refreshing to see so many associations with common interests join together in this effort and obtain positive results. I am sure there will be similar challenges in the future, and I hope we can join together, once again, to successfully oppose those challenges.

Second, NASBP CEO Mark McCallum and Government Relations Director Larry LeClair persuaded Richard Hanna (R-NY) and Mick Mulvaney (R-SC) to co-sponsor and introduce “The Security and Bonding Act of 2011.” We have discussed this initiative for some time, and it is very satisfying to see this legislation proposed. I want to thank Mark and Larry for their tireless efforts as we take the first step towards making sure that personal sureties are accountable and have the financial wherewithal to back the bonds they guarantee. We have a long way to go, and we will be seeking additional support from others on Capitol Hill. As Mark states in his article in this issue, it is critical that we all seek out our members of Congress and ask them to support H.R. 3534. Also, I would like to remind you that 2012 is a federal election year. Please consider signing the NASBP Political Action Committee, SuretyPAC, Prior Approval Form, which allows NASBP to solicit your agency for support of the SuretyPAC. Please contact Larry LeClair at lleclair@nasbp.org, Vanessa Stevens at vstevens@nasbp.org, or Kathy Hoffman at khoffman@nasbp.org with any questions you may have.

Wrapping up 2011

It is hard to believe that 2011 is coming to an end. 2011 was a year in which we thought our industry would realize losses like those that we had seen in the early 2000’s. To my surprise, industry experts are predicting that this year will be, overall, pretty good for our surety partners. However, there are indications that next year’s losses will accelerate, as budgets remain tight. Trusting relationships will continue to guide us and many of our decisions in 2012. I remind my skeptical clients of the successes that we enjoyed for years prior to this downturn. We live in the best country in the world and are fortunate to be so blessed. This economy will bounce back, I have no doubt. Now, more than ever, I am thankful for the relationships I have established through this Association. This past year has been especially rewarding as I have met so many new friends in my travels. I want to thank Mark McCallum and the entire NASBP staff for all of their hard work this past year. In addition, I am thankful for the guidance of the Executive Committee members, Carl Dohn, Larry McMahon, Tom Padilla, Spence Miller (recently nicknamed “Has Been”), Susan Hecker, and Bob Bobo.

I wish you all a very Merry Christmas, Happy Holidays, and a Healthy 2012!

John M. Rindt
NASBP President

John M. Rindt is Executive Vice President of JDW Insurance in El Paso, TX. John can be reached at jrindt@jdw-insurance.com.