28.101-1 Policy on use
Source: FAR 28.101-1 on acquisition.gov
Bid guarantees are only required when performance or performance and payment bonds are also required, with waivers possible in the Government's best interest.
Overview
FAR 28.101-1 establishes the policy for when bid guarantees are required in federal contracting. It mandates that contracting officers should only require a bid guarantee if a performance bond or a performance and payment bond is also required. Generally, if a performance bond or a performance and payment bond is required, a bid guarantee must also be obtained, except in certain circumstances where a waiver is justified. The section also clarifies the types of bid guarantees acceptable for different contract types and outlines the authority and process for waiving the bid guarantee requirement.
Key Rules
- Bid Guarantee Requirement
- Bid guarantees are only required when a performance bond or a performance and payment bond is also required.
- Types of Acceptable Bid Guarantees
- All types of bid guarantees are acceptable for supply or service contracts, but only separate bid guarantees (typically bid bonds) are acceptable for construction contracts.
- Waiver Authority
- The chief of the contracting office may waive the bid guarantee requirement if it is not in the Government's best interest for a specific acquisition; class waivers require agency head or designee approval.
Responsibilities
- Contracting Officers: Must ensure bid guarantees are only required when appropriate and must follow waiver procedures if not in the Government's best interest.
- Contractors: Must provide the appropriate type of bid guarantee when required by the solicitation.
- Agencies: Must oversee the waiver process and ensure compliance with policy.
Practical Implications
- This policy ensures bid guarantees are only used when necessary, reducing unnecessary burdens on contractors and the Government. Contractors should carefully review solicitation requirements to determine if a bid guarantee is needed and what type is acceptable. Waivers are possible but require proper justification and approval, especially for unique or emergency situations.
(a) A contracting officer shall not require a bid guarantee unless a performance bond or a performance and payment bond is also required (see 28.102 and 28.103). Except as provided in paragraph (c) of this subsection, bid guarantees shall be required whenever a performance bond or a performance and payment bond is required.
(b) All types of bid guarantees are acceptable for supply or service contracts (see annual bid bonds and annual performance bonds coverage in 28.001). Only separate bid guarantees are acceptable in connection with construction contracts. Agencies may specify that only separate bid bonds are acceptable in connection with construction contracts.
(c) The chief of the contracting office may waive the requirement to obtain a bid guarantee when a performance bond or a performance and payment bond is required if it is determined that a bid guarantee is not in the best interest of the Government for a specific acquisition (e.g., overseas construction, emergency acquisitions, sole-source contracts). Class waivers may be authorized by the agency head or designee.