Subcontract Terms/Liquidated Damages Inapposite to Subcontractor & Disadvantaged Business Participation

I wish to make you aware of concerns that the National Association of Surety Bond Producers (NASBP), a national trade organization of professional surety bond producers, whose membership includes firms employing licensed surety bond producers placing bid, performance, and payment bonds throughout the United States, including in North Carolina, has regarding the flow down requirement of liquidated damages to subcontractors performing work on the UNC-Greensboro Spartan Village Project. In the opinion of NASBP, the liquidated damages requirements that flow down to subcontractors will stifle overall subcontractor competition for the project and, in addition, will sabotage and subvert the stated project goals of “encouraging participation of Minority or Women Owned Business Enterprises/Historically Underutilized Businesses.” Such liquidated damages requirements appear excessively high and are uncapped, constituting a substantial risk to subcontractors of all types and sizes.

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