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House Small Business Committee Hearing on the SBA’s Surety Bond Guarantee Program

On Wednesday, July 27, 2022, the House Small Business Committee held a hearing on the Small Business Administration (SBA)’s Surety Bond Guarantee Program.  ASA participated in the SBA’s 50th Anniversary of the program and during the hearing, Peter C. Gibbs, the former Director of the Office of Surety Guarantees of SBA, testified about the program’s recent enhancements that would help small and emerging contractors such as:

  • increasing the contract size bond amount from $2 million to $6.5 million, and up to $10 million for federal contracts with the contracting officer’s certification;
  • granting the SBA Administrator with statutory discretion to determine the portion of liability assumed by the SBA and the surety;
  • increasing the guarantee up to 90% for participating surety companies;
  • instituting a paperless application process while approving bond applications in less than two days;
  • raising the streamlined Quick Bond Application from $250,000 to $400,000; and
  • reducing the fees charged to sureties and contractors which secure surety bonds through the program to create greater opportunities for small and emerging contractors to grow their businesses and stimulate greater corporate surety and surety bond producer participation in the Program.

Per Mr. Gibbs, “these changes are the direct result of an increase in surety company partnerships, which rose from 23 to 42 companies. For Fiscal Year 2021, the SBA guaranteed bid and final bonds totaled more than $6.8 billion in overall contract value. With the work of the SBA’s top-performing surety partners and bond agencies, over 1,600 small businesses were assisted, and over 34,000 jobs were supported according to the SBA.”