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  • Question

    With the exception of FAR 28.106-5 Consent of Surety is there other clauses weather FAR or DFARS that address this issue. I cannot locate any that address this issue with any clarity. In FAR Clause 52.228-15(b)(3) it states that the Government may require additional performance and payment bond protection if the contract price increases but is that not covered by 28.106-5 and the thresholds it contain.


    Answer

    This response is based on the information provided.  We suggest you discuss with your contracting team, project manager and/or legal department as appropriate.

     

     Your question appears to be asking if a charge for a bond is allowable.  The answer is yes.

    "FAR 31.205-4 Bonding costs.

          (a) Bonding costs arise when the Government requires assurance against financial loss to itself or others by reason of the act or default of the contractor. They arise also in instances where the contractor requires similar assurance. Included are such bonds as bid, performance, payment, advance payment, infringement, and fidelity bonds.

          (b) Costs of bonding required pursuant to the terms of the contract are allowable.

          (c) Costs of bonding required by the contractor in the general conduct of its business are allowable to the extent that such bonding is in accordance with sound business practice and the rates and premiums are reasonable under the circumstances."

     

    Your reference, FAR 28.106-5, is related to consent of sureties, not allowability of bond costs.  As for other clauses, the only clauses that matter to answer your question are the clauses in your contract.  The clause you cite, FAR 52.228-15(b)(3), does not support your belief the charge is unallowable.

     

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