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COMMITTEE REPORT
April 10, 2002
H. 4823
Introduced by Reps. Cato, Chellis, Battle, G. Brown, J. Brown, Cooper, Edge, Harrison, Hinson, Jennings, Law, Lee, Limehouse, Lourie, Miller, Perry, Quinn, Rice, Rutherford, Sandifer, Scarborough, Scott, F.N. Smith, J.E. Smith, Tripp, Trotter, Walker and White
S. Printed 4/10/02--H.
Read the first time February 27, 2002.
To whom was referred a Bill (H. 4823) to amend the Code of Laws of South Carolina, 1976, by adding Section 11-35-35 so as to prohibit the State, a political subdivision of the State, or other public entity of the State from requiring that a bond, etc., respectfully
That they have duly and carefully considered the same and recommend that the same do pass:
HARRY F. CATO for Committee.
TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION 11-35-35 SO AS TO PROHIBIT THE STATE, A POLITICAL SUBDIVISION OF THE STATE, OR OTHER PUBLIC ENTITY OF THE STATE FROM REQUIRING THAT A BOND TO SECURE THE BID OR THE PERFORMANCE OR PAYMENT OF THE CONTRACT BE FURNISHED BY A PARTICULAR SURETY COMPANY OR THROUGH A PARTICULAR AGENT OR BROKER; AND TO AMEND SECTIONS 11-1-120, 11-35-3030, AS AMENDED, 12-28-2740, 29-6-250, AND 57-5-1660, RELATING TO PAYMENT BONDS, BID BONDS, PERFORMANCE BONDS, LABOR AND MATERIAL BONDS, AND HIGHWAY CONSTRUCTION BONDS, RESPECTIVELY, ALL SO AS TO ADD CONFORMING LANGUAGE PROHIBITING THE STATE, A POLITICAL SUBDIVISION OF THIS STATE, OR OTHER PUBLIC ENTITY OF THE STATE FROM REQUIRING THAT THE BOND BE FURNISHED BY A PARTICULAR SURETY COMPANY OR THROUGH A PARTICULAR AGENT OR BROKER.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. The 1976 Code is amended by adding:
"Section 11-35-35. If the State, or county, city, public service district, or other political subdivision of the State, or agency, department, institution, or other public entity of the State, enters into a procurement contract and requires the bidder to provide a surety bond to secure the bid or the performance or payment of the contract, the state political subdivision of the State, or public entity of the State may not exact that the surety bond be furnished by a particular surety company or through a particular agent or broker."
SECTION 2. Section 11-1-120 of the 1976 Code, as added by Act 240 of 2000, is amended by adding an undesignated paragraph at the end to read:
"If the State, or county, city, public service district, or other political subdivision of the State, or other public entity contracts for construction and requires the contractor to furnish a payment bond pursuant to this section, the State, political subdivision of this State, or other public entity of this State may not exact that the payment bond be furnished by a particular surety company or through a particular agent or broker."
SECTION 3. Section 11-35-3030 of the 1976 Code, as last amended by Act 240 of 2000, is further amended by adding at the end:
"(5) Bonds for Bid Security and Contract Performance. The requirement of a bond for bid security on a construction contract, pursuant to subsection (1), and a construction contract performance bond, pursuant to subsection (2), may not include a requirement that the surety bond be furnished by a particular surety company or through a particular agent or broker."
SECTION 4. Section 12-28-2740(I) of the 1976 Code is amended to read:
"(I)(1) In expending funds under pursuant to this section, counties that provide for engineering, contracting, and project supervision shall use a procurement system which that requires competitive sealed bids and public advertisement of all projects. All bids for contracts in excess of one hundred thousand dollars must be accompanied by certified bid bonds, and all work awarded under the contracts must be covered by performance and payment bonds for one hundred percent of the contract value. Bid summaries must be published in a newspaper of general distribution following each award.
(2) The requirement of a bond for bid security or a bond for payment and performance may not include the requirement that the surety bond be furnished by a particular surety company or through a particular agent or broker."
SECTION 5. Section 29-6-250(1) of the 1976 Code, as added by Act 295 of 2000, is amended by adding at the end:
"The governmental body may not exact that the labor and material payment bond be furnished by a particular surety company or through a particular agent or broker."
SECTION 6. Section 57-5-1660 of the 1976 Code, as last amended by Act 240 of 2000, is further amended by adding at the end:
"(d) If the Department of Transportation enters into a public highway construction contract exceeding ten thousand dollars and requires that the contractor furnish a performance and indemnity bond, or a payment bond, or both of them, the department, the county, or the road district may not exact that the surety bond be furnished by a particular surety company or through a particular agent or broker."
SECTION 7. This act takes effect upon approval by the Governor and applies to all subject contracts entered into after that date.
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