Section 27-2707. SURETY BONDS AND OTHER SECURITY

 

2707.1A new surety bond covering all or part of the obligation on a security previously approved may be substituted for the original security, if approved by the contracting officer.

 

2707.2When a new surety bond is approved, the contracting officer shall notify the principal and surety on the original bond of the effective date of the new bond.

 

2707.3In addition to the requirements of §505(b) of the Act, D.C. Code §1-1185.2(b) (1981), when a payment security has been provided, the contracting officer shall, upon request, furnish the name and address of the surety or sureties to any subcontractor or supplier who has furnished or been requested to furnish labor or material for a contract. In addition, general information concerning the work progress, payments, and the estimated percentage of completion may be furnished to persons who have provided labor or material and have not been paid.

 

2707.4During contract performance of contracts requiring payment and performance security, agencies shall not withhold payments that are due to contractors or assignees because subcontractors or suppliers have not been paid.

 

2707.5If, after completion of the work of a contract requiring payment and performance security, the District receives written notice from the surety regarding the contractor's failure to meet its obligation to its subcontractors or suppliers, the contracting officer shall withhold final payment. However, the surety shall agree to hold the District harmless from any liability resulting from withholding the final payment. The contracting officer shall authorize final payment upon agreement between the contractor and surety or upon a judicial or other binding determination of the rights of the parties.

 

2707.6If the amount of security exceeds the surety's underwriting limit, as established by the U.S. Department of the Treasury or a list established by the District, the security shall be acceptable only if:

 

(a)The amount that exceeds the specified limit is coinsured or reinsured; and

 

(b)The amount of coinsurance or reinsurance does not exceed the underwriting limit of each coinsurer or reinsurer.

 

source

Final Rulemaking published at 35 DCR 1601 (February 26, 1988).