President’s Message: NASBP Building Better Through Advocacy

Merriam-Webster defines Advocacy as “the act or process of supporting a cause.” It is core to the NASBP’s mission and how we are Building Better. Our advocacy is focused on promoting the use of surety bonds, making sure that the legal and regulatory environment is favorable for their use, and helping people understand the benefits surety bonds provide.

NASBP Blogs, NASBP Virtual Seminars, NASBP SmartBrief, and other publications along with NASBP’s podcast, Let’s Get Surety, promote surety within our industry and among those that use or benefit from surety bonds. These offerings are targeted at broad audiences in an effort to build a general understanding of surety.

We are also very active in targeted education efforts. I keep a white paper (https://www.nasbp.org/pipeline-newsletter/legal-spotlight-38/) that Martha Perkins, NASBP’s recently retired legal counsel, wrote years ago addressing the illegality of resident agent countersignature requirements. While legislation and court decisions have made the requirement illegal since 2008, many forms have never been updated, so it still crops up occasionally. Sending the obligee the white paper educates them and usually gets the requirement amended to a licensed agent or removed altogether.

More recently, members brought to NASBP’s attention requirements by local jurisdictions in Colorado and Wyoming to require 125% performance and payment bonds on local construction projects. Mark McCallum, NASBP’s CEO, was able to write letters to the procurement officials for these projects to educate them on why the requirements were not in their best interest. The arguments proved persuasive–both project specifications were amended to revert to the typical 100% bond requirement.

We also work closely with our partners at the SFAA and other trade organizations, such as AGC and ASA, to make sure the legal environment continues to support the surety industry. A couple of current examples include efforts to amend a procurement statute in Kansas to require mutual waivers of consequential damages provisions in public contracts and to correct an adverse lower court decision to surety interests which is on appeal to the Texas Supreme Court.

In Texas, a district court ruled that the statute of limitations on a bond claim does not commence at the bonded contractor’s default and termination—it starts at the surety’s default under the bond. While this issue is of first impression, since the wording of the applicable statute has not been interpreted by a Texas court previously, the lower court decision stands inapposite to how most jurisdictions construe similar statutory requirements. The surety involved requested that NASBP provide an Amicus Brief supporting their position that this decision should be reversed. We’re working with our partners at the SFAA to provide a joint Brief to hopefully get this adverse opinion overturned.

In Kansas, certain state procuring agencies are expanding the breadth of damages that contractors are liable for contractually. This state practice is an inequitable extension of liability on contractors, also making surety support more challenging.  In order to blunt this practice, a coalition of groups and individuals, including Monica Donatelli, VP with IMA Financial Group and NASBP’s  First Vice President are advocating for the advancement of legislation to ensure the insertion of mutual waivers of consequential damages clauses in public contracts. Monica will be testifying before the Kansas State Senate Commerce Committee to support this legislation. This position also is supported by AGC, ASA, and other trade groups, illustrating that effective advocacy is a team effort.

One of our industry’s largest advocacy initiatives is the Federal Legislative Fly-in, where we partner with the SFAA. We’ll be heading to Washington DC on Tuesday and Wednesday, February 24 and 25 this year. Once again, the Fly-in’s opening reception will be preceded by the Washington Program. Noted political pundit Amy Walter will give her analysis of the current political atmosphere in DC and an early look at the November mid-term elections. We also hope to have an administrative or legislative perspective on what’s happening with transportation funding and priorities. Wednesday morning will start with a breakfast and discussion of the talking points on the issues we want to support, including WIFIA legislation and broadening the use of bonds to support rural broadband expansion.  To date, NASBP members from 35 states have signed up for a potential 180 meetings with their congressional delegation.  If you haven’t participated in a Fly-in before, this is a good opportunity to attend with your fellow surety professionals. Please be sure to register for Fly-in here: https://www.nasbp.org/networking-events/upcoming-events/legislative-fly-in/2026legislative-fly-in/ There is no registration fee and this is a great way to support your industry and career. I look forward to seeing you there. #BuildingBetter

Robert Coon is Vice President – Surety at Scott Insurance in Greensboro, NC. He can be reached at rcoon@scottins.com or 336.510.0072.