§ 5018 Contractor Performance Surety Bond

• •If you're a contractor, you need to get a special promise (called a 'surety bond') before starting a job.
• •This promise must be worth at least 25% of the total job cost.
• •The promise makes sure you'll do the job right. If you don't, the money from the bond can be used to fix problems.

A contractor is hired to build a new school playground for $100,000.

Before starting, the contractor must get a surety bond worth at least $25,000 (which is 25% of $100,000). This bond is like a safety net—if the contractor doesn’t finish the playground or does a bad job, the school can use the bond money to hire someone else to fix it.