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Why was the Miller Act created?

Congress enacted the Miller Act to compensate for the difficulties that subcontractors would otherwise have in obtaining payment from federal construction contractors, given that they cannot place a mechanics lien on the work because the government has sovereign immunity.

When was the Miller Act passed?

Enacted in 1935, the Miller Act requires that, before any contract exceeding $100,000 is awarded for the construction, alteration or repair of any building or public work of the United States, the construction contractor must furnish a payment bond and a performance bond.

How long is a performance bond good for?

Performance bonds are usually good until the end of a year. But, it varies depending on what type and term you have purchased; sometimes they last two or three years! If thats not right for you though there may be other options at renewal to reduce rates.

What is the meaning of performance bond?

A performance bond is a type of contract construction bond that guarantees a contractor will complete a project according to the terms outlined in a contract by the project owner, also called the obligee. The obligee can be a city, state, or local government, as well as the federal government or a private developer.

What is a performance bond and how does it work?

What is a performance bond? A performance bond is an agreement between the contractor and the owner of a project. The contractor agrees to provide a certain level of work in exchange for payment, while the owner agrees to pay if the work is not completed satisfactorily.

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