HomeMy WebLinkAboutContract Security Policy
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A Community of Communities
CONTRACT SECURITY POLICY
BACKGROUND:
The Director of Engineering and Public works advises that construction contract security
is protection for the owner in the event the Contractor fails to perform the contract, to pay
material supplies, labour, sub-contractors, taxes, and government levies. Bid bonds,
Labour and Material Bonds, Performance Bonds and Warranties are standard in the
construction industry.
In the past CBRM has been issuing tendering requiring 50% performance bond and 50%
security bond. When a bonding company is called on a default, there are 60-90 days
before action would take place, resulting in job delays.
To allow for more competitive bidding CBRM staff puts forth the following option.
A 10% bid security or certified cheque plus another 10% contract security is
required for most contracts or alternately 10% plus 50% labour and 50% material
bond would also be accepted. This option allows a company not bondable to
compete, thus allowing for more competitive bidding.
Approved by CBRM Council on 21st, day of May, 1996.