Senate Bill sb1516

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    Florida Senate - 2001                                  SB 1516

    By Senator Constantine





    9-854-01

  1                      A bill to be entitled

  2         An act relating to surety bonds; amending ss.

  3         235.32, 255.05, F.S.; prohibiting public

  4         entities from directing that contractors

  5         building public facilities obtain surety bonds

  6         from a specific agent or bonding company;

  7         providing an effective date.

  8

  9  Be It Enacted by the Legislature of the State of Florida:

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11         Section 1.  Section 235.32, Florida Statutes, is

12  amended to read:

13         235.32  Substance of contract; contractors to give

14  bond; penalties.--Each board shall develop contracts

15  consistent with this chapter and statutes governing public

16  facilities. Such a contract must contain the drawings and

17  specifications of the work to be done and the material to be

18  furnished, the time limit in which the construction is to be

19  completed, the time and method by which payments are to be

20  made upon the contract, and the penalty to be paid by the

21  contractor for any failure to comply with the terms of the

22  contract. The board may require the contractor to pay a

23  penalty for any failure to comply with the terms of the

24  contract and may provide an incentive for early completion.

25  Upon accepting a satisfactory bid, the board shall enter into

26  a contract with the party or parties whose bid has been

27  accepted. The contractor shall furnish the board with a

28  performance and payment bond as set forth in s. 255.05. A

29  board or other public entity may not require a contractor to

30  secure a surety bond under s. 255.05 from a specific agent or

31  bonding company. Notwithstanding any other provision of this

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    Florida Senate - 2001                                  SB 1516
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  1  section, if 25 percent or more of the costs of any

  2  construction project is paid out of a trust fund established

  3  pursuant to 31 U.S.C. s. 1243(a)(1), laborers and mechanics

  4  employed by contractors or subcontractors on such construction

  5  will be paid wages not less than those prevailing on similar

  6  construction projects in the locality, as determined by the

  7  Secretary of Labor in accordance with the Davis-Bacon Act, as

  8  amended. A person, firm, or corporation that constructs any

  9  part of any educational plant, or addition thereto, on the

10  basis of any unapproved plans or in violation of any plans

11  approved in accordance with the provisions of this chapter and

12  rules of the Commissioner of Education relating to building

13  standards or specifications is subject to forfeiture of bond

14  and unpaid compensation in an amount sufficient to reimburse

15  the board for any costs that will need to be incurred in

16  making any changes necessary to assure that all requirements

17  are met and is also guilty of a misdemeanor of the second

18  degree, punishable as provided in s. 775.082 or s. 775.083,

19  for each separate violation.

20         Section 2.  Subsection (1) of section 255.05, Florida

21  Statutes, is amended to read:

22         255.05  Bond of contractor constructing public

23  buildings; form; action by materialmen.--

24         (1)(a)  Any person entering into a formal contract with

25  the state or any county, city, or political subdivision

26  thereof, or other public authority, for the construction of a

27  public building, for the prosecution and completion of a

28  public work, or for repairs upon a public building or public

29  work shall be required, before commencing the work or before

30  recommencing the work after a default or abandonment, to

31  execute, deliver to the public owner, and record in the public

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    Florida Senate - 2001                                  SB 1516
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  1  records of the county where the improvement is located, a

  2  payment and performance bond with a surety insurer authorized

  3  to do business in this state as surety. A public entity may

  4  not require a contractor to secure a surety bond under this

  5  section from a specific agent or bonding company. The bond

  6  must state on its front page: the name, principal business

  7  address, and phone number of the contractor, the surety, the

  8  owner of the property being improved, and, if different from

  9  the owner, the contracting public entity; the contract number

10  assigned by the contracting public entity; and a description

11  of the project sufficient to identify it, including, if

12  applicable, a legal description and the street address of the

13  property being improved, and a general description of the

14  improvement. Such bond shall be conditioned that the

15  contractor perform the contract in the time and manner

16  prescribed in the contract and promptly make payments to all

17  persons defined in s. 713.01 whose claims derive directly or

18  indirectly from the prosecution of the work provided for in

19  the contract. Any claimant may apply to the governmental

20  entity having charge of the work for copies of the contract

21  and bond and shall thereupon be furnished with a certified

22  copy of the contract and bond. The claimant shall have a right

23  of action against the contractor and surety for the amount due

24  him or her, including unpaid finance charges due under the

25  claimant's contract. Such action shall not involve the public

26  authority in any expense.  When such work is done for the

27  state and the contract is for $100,000 or less, no payment and

28  performance bond shall be required. At the discretion of the

29  official or board awarding such contract when such work is

30  done for any county, city, political subdivision, or public

31  authority, any person entering into such a contract which is

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    Florida Senate - 2001                                  SB 1516
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  1  for $200,000 or less may be exempted from executing the

  2  payment and performance bond. When such work is done for the

  3  state, the Secretary of the Department of Management Services

  4  may delegate to state agencies the authority to exempt any

  5  person entering into such a contract amounting to more than

  6  $100,000 but less than $200,000 from executing the payment and

  7  performance bond. In the event such exemption is granted, the

  8  officer or officials shall not be personally liable to persons

  9  suffering loss because of granting such exemption. The

10  Department of Management Services shall maintain information

11  on the number of requests by state agencies for delegation of

12  authority to waive the bond requirements by agency and project

13  number and whether any request for delegation was denied and

14  the justification for the denial.

15         (b)  The Department of Management Services shall adopt

16  rules with respect to all contracts for $200,000 or less, to

17  provide:

18         1.  Procedures for retaining up to 10 percent of each

19  request for payment submitted by a contractor and procedures

20  for determining disbursements from the amount retained on a

21  pro rata basis to laborers, materialmen, and subcontractors,

22  as defined in s. 713.01.

23         2.  Procedures for requiring certification from

24  laborers, materialmen, and subcontractors, as defined in s.

25  713.01, prior to final payment to the contractor that such

26  laborers, materialmen, and subcontractors have no claims

27  against the contractor resulting from the completion of the

28  work provided for in the contract.

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    Florida Senate - 2001                                  SB 1516
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  1  The state shall not be held liable to any laborer,

  2  materialman, or subcontractor for any amounts greater than the

  3  pro rata share as determined under this section.

  4         Section 3.  This act shall take effect upon becoming a

  5  law.

  6

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  8                          SENATE SUMMARY

  9    Prohibits school boards and other public entities from
      directing that contractors building public facilities
10    obtain surety bonds from a specific agent or bonding
      company.
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