DBE GoodFaith's
Monthly Newsletter
Public Works, Procurement, and Disadvantaged Business News
Monthly Newsletter
August 2011 | Volume 2, Number 4 | Texas | www.dbegoodfaith.com
Introduction to bonding, courtesy of the Austin SMBR
This is the second in a quarterly series of bonding tips provided by the City of Austin SMBR Bonding Program, which is designed to assist SMBR certified firms in establishing and growing their bonding capacity.
Surety Bonding
Surety bonding is a three-party agreement in which the surety company assures the project owner (i.e. City of Austin) that the principal (contractor or subcontractor) will complete a contract as per the terms stated. Most government funded construction projects require surety bonding of the prime contractor and many times a prime contractor will require surety bonding of their larger subcontractors. It is important to obtain your bond as early in the bidding process as possible.
Bonding Capacity Letters
Much like being pre-approved for a loan amount, the bonding capacity letter states that you are pre-approved for bonding up to a certain amount. A bonding capacity letter can be obtained from a qualified bonding agent at any time. Experienced contractors can often get letters for $250,000 based solely on a personal credit score of 670 or higher for all owners and spouses. It is a good idea to get your bonding capacity letter before bidding on any projects.
Credit Reports
As a business owner it is important to stay on top of your credit history, it is critical to obtaining bonding and/or financing. You can obtain a free credit report at www.annualcreditreport.com. While annualcreditreport.com does not give you a credit score, it does give an accurate and current credit report, including any negative items that might be affecting your score.
SMBR's Bonding Resource Program
If you are interested in obtaining education and assistance with your bonding needs, contact SMBR's Financial Bonding Consultant, Luke Ortega Luper at 512-974-7733 or email him at Luke.Luper@ci.austin.tx.us. Luke is available to meet one-on-one to provide educational support and qualified bonding resources as you work to increase your capacity to do business with this City.
Keep in mind that SMBR does not issue bonds or provide financing. This program is provided as a free resource to certified business owners and all information provided is completely confidential.
SMBR assists small, minority-owned and women-owned businesses as they pursue contracting opportunities with the City of Austin; encourages Minority Business Enterprises, Woman Business Enterprises and Disadvantaged Business Enterprises to participate in City contracts; and oversees the City's MBE/WBE and DBE contracting goals in the areas of construction, professional services, commodities and non-professional services. For more information about the Small and Minority Business Resources Department, please review the SMBR Web site www.austintexas.gov/smbr or call (512) 974-7677.
Surety Bonding
Surety bonding is a three-party agreement in which the surety company assures the project owner (i.e. City of Austin) that the principal (contractor or subcontractor) will complete a contract as per the terms stated. Most government funded construction projects require surety bonding of the prime contractor and many times a prime contractor will require surety bonding of their larger subcontractors. It is important to obtain your bond as early in the bidding process as possible.
Bonding Capacity Letters
Much like being pre-approved for a loan amount, the bonding capacity letter states that you are pre-approved for bonding up to a certain amount. A bonding capacity letter can be obtained from a qualified bonding agent at any time. Experienced contractors can often get letters for $250,000 based solely on a personal credit score of 670 or higher for all owners and spouses. It is a good idea to get your bonding capacity letter before bidding on any projects.
Credit Reports
As a business owner it is important to stay on top of your credit history, it is critical to obtaining bonding and/or financing. You can obtain a free credit report at www.annualcreditreport.com. While annualcreditreport.com does not give you a credit score, it does give an accurate and current credit report, including any negative items that might be affecting your score.
SMBR's Bonding Resource Program
If you are interested in obtaining education and assistance with your bonding needs, contact SMBR's Financial Bonding Consultant, Luke Ortega Luper at 512-974-7733 or email him at Luke.Luper@ci.austin.tx.us. Luke is available to meet one-on-one to provide educational support and qualified bonding resources as you work to increase your capacity to do business with this City.
Keep in mind that SMBR does not issue bonds or provide financing. This program is provided as a free resource to certified business owners and all information provided is completely confidential.
SMBR assists small, minority-owned and women-owned businesses as they pursue contracting opportunities with the City of Austin; encourages Minority Business Enterprises, Woman Business Enterprises and Disadvantaged Business Enterprises to participate in City contracts; and oversees the City's MBE/WBE and DBE contracting goals in the areas of construction, professional services, commodities and non-professional services. For more information about the Small and Minority Business Resources Department, please review the SMBR Web site www.austintexas.gov/smbr or call (512) 974-7677.
Upcoming Events
Federal Government Contracting: Getting on the GSA Schedule & GSA Pricing Matters8/4/2011 | 1:00 p.m. to 3:00 p.m.
Texas State University - San Marcos SBDC
1555 University Blvd.
Round Rock, TX 78665
Learn more
Texas Association of Mexican American Chambers of Commerce 36th Annual Conference
8/25/2011 to 8/27/2011
Sheraton DFW Aiport Hotel
4440 West John Carpenter Freeway
Irving, TX 75063
Learn more
Find more events!
We are your Good Faith Effort solution
Since our start in 2005, DBE GoodFaith Inc. has become a leader in disadvantaged business outreach, having helped over 1,200 firms meet contracts' outreach requirements on more than 9,000 contract bids.
With DBE GoodFaith's intuitive outreach service, disadvantaged businesses (DBEs, MBEs, WBEs, & HUBs) can be targeted to receive subcontracting and supplier opportunities for your contract.
Our system allows bidders to:
- Advertise for DBEs, MBEs, WBEs, & HUBs;
- Automatically fax and email invitations to bid to DBE subcontractors;
- Complete initial & follow-up phone call solicitations with the help of our call center; and
- Automatically document all outreach performed.
For more information on how DBE GoodFaith can help your business, contact us at (877) 802-3394 or visit www.dbegoodfaith.com.