Transcript CONTRACTOR BONDWORKS

Los Angeles Unified School District
CONTRACTOR
BONDWORKS
More than Bonding. Access to Capital.
What is the Contractor
BondWorks Program?
Who Can Participate In It?
Eliminates barriers to bonding and access to
capital by providing line of credit guarantees
for LAUSD construction contracts.
Experienced contractors or newly
established construction companies may
apply, as long as the eligibility criteria is met.
Overview of Program Services
• Bid, Performance and Payment Bond
Guarantees
• Contract Financing Guarantees
• Contractor Consultation & Technical
Assistance
• Third Party Funds Administration
Program Services
Bid, Performance & Payment Bond Guarantees
• Eligible contractors will be positioned to secure
bid, performance and payment bonds for LAUSD
contracts.
• The bond guarantee maximum is 40% of bond or
$400,000, whichever is less, per contract, per
contractor.
Program Services
Contract Financing Guarantees
• Contractors will have access to contract financing
guarantees of up to 50% of contract specific
financing or $200,000, whichever is less, to pay
for materials, subcontractors and labor costs
associated with LAUSD contracts.
• Contractors may utilize a combination of bond
and finance guarantees up to a maximum value
of $400,000.
Program Services
Contractor Consultation & Technical Assistance
• Contractors will be provided with one-on-one
consultations to determine bonding and financing
eligibility, and access to financial management workshops.
Third Party Funds Administration
• Participating contractors will be provided with funds
administration services to ensure timely payment to
suppliers and subcontractors, and to fulfill labor expense
obligations.
• A successful payment history will increase contractor credit
worthiness for continued access to bonding and capital.
Example of Services
The Challenge:
• ABC Construction Co. has $250,000 in bond
capacity currently available to their company.
• They have recently come across an LAUSD
contract for which their bid estimate is
approximately $350,000.
• Being that their bond capacity is limited to $250k,
they are having a difficult time in obtaining a
bond for $350k to support this contract.
Example of Services
The Solution:
The Contractor BondWorks Program can
potentially negotiate with the contractor's
Surety Co. to post a collateral guarantee to them
on behalf of the contractor (up to the maximum
limits afforded by the program) so that the
Surety Co. may increase the contractor’s bond
capacity to $350,000—thereby allowing the
contractor to obtain the bonding required for
this contract.
Program Eligibility
• Graduation from the Small Business
Boot Camp or the Contractor Academy
• Labor Compliance Training
• Project Stabilization Agreement Training
• Safety/Contractor Prequalification
Frequently Asked Questions
• If I already have a bond agent, do I have to switch over
to your company?
• I currently have $400k in bonding capacity, can I get the
additional $400k from your program?
• I already submitted my information to my broker, do I
have to submit all my information to your company
again?
• What is the cost to participate in your program?
• Does your program have a minimum or maximum
dollar value for contracts that are eligible to
participate?
• I have already worked on LAUSD projects in the past,
do I have to attend all the training seminars?
Enroll Today!
Merriwether & Williams
Insurance Services
523 West 6th Street, Suite 650
Los Angeles, CA 90014
Tel. (213) 258-3000 – Fax. (213) 258-3099
Nicolas Barrios
(213) 258-3080
[email protected]
Navid Barkhordar
(213) 258-3090
[email protected]