Public WorksQuestion 1590 of 1605
On a public works project, a 'bid bond' submitted with a contractor's bid primarily guarantees that:
a.The project will be defect-free
b.The subcontractors are DIR-registered
c.The workers will be paid prevailing wage
d.If awarded, the bidder will enter into the contract and furnish the required payment and performance bonds
Explanation
A bid bond guarantees that the winning bidder will honor its bid by executing the contract and providing the required payment and performance bonds. If the bidder refuses, the surety/bidder pays the difference (up to the bond) to the agency, protecting the public entity.
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Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)