Skip to content

ASA Supports the FAR’s Exemption of Periodic Inflation Adjustments to the Miller Act

On Tuesday, October 4, 2022, ASA submitted supportive comments regarding the Federal Acquisition Regulation (FAR)’s exemption of periodic inflation adjustments to the Miller Act.  Per our comments, “the federal government long has recognized the importance of surety bonding requirements on federal construction contracts. The Miller Act, enacted in 1935, and related regulations, require that a payment and performance bond be secured on federal construction contracts in excess of $150,000 threshold.  The performance bond assures the federal government and U.S. taxpayers that the construction contract will be performed fully in accordance with its terms and conditions.  The payment bond provides invaluable payment protection to parties furnishing labor and/or materials on federal construction contracts. Subcontractors, my members, and suppliers rely on the payment bond in the event of non-payment of the prime contractor.  When Congress passed the FY22 National Defense Authorization Act (NDAA) to include this FAR exemption, they made the sound public policy decision that surety bond protections cannot be allowed to be compromised; thereby not jeopardizing performance protections benefiting contracting agencies and payment protections benefiting subcontractors and suppliers.  These protections are critical to small businesses, which cannot readily withstand non-payment or severe cash flow interruptions.”

Click here to view the letter.