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  • 06 Apparatus Awards

    Bryan maybe you can shed some light on this for me.

    I am working with a department who will recieve a 06 apparatus grant next round. In researching the bid bond amount requirement I put a call into the help desk.

    What the guy I spoke to told me does not fit in to what we typically call a bid bond.

    He stated the bid bond is only a contractual agreement within the contract that states the manufacturer will pay a penalty of X dollars for everyday the vehicle is late.

    He said this is done due to manufactures shifting production dates to accomodate large departments multiple unit orders while the grant unit will get pushed beyond the performance period.

    The typical performance bond as I know it is offered during the bid phase, usually in 5% that is an insurance poilcy that will cover anyproblems if the unit does not meet specs. The bid bond is essentially an insurance policy that is purchased by the manufacturer on behalf of the buyer.

    If you started looking at a 200k bid bond it will add a significant amt to these units.

    Have you or anyone else got any simular info? Its just that dealing with the Federal Governement I am a bit skeptical unless its in writing somewhere.


    Steve

  • #2
    From my conversations with DHS, the requirement is for a performance bond
    based strictly on delivery date. They are trying to ensure that the delivery
    date is within the period of performance of the grant.

    They are RECOMENDING however that a department gets a bond that also covers the truck being built as per contract - ie, you get what you contract for and everything works.

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    • #3
      What he said.

      And I wouldn't build a truck without a bond regardless of who is paying.
      Brian P. Vickers
      www.vickersconsultingservices.com
      Emergency Services Consulting
      Westlake VFD - Houston, TX
      Proud Member IACOJ - Redneck Division

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      • #4
        Dudn't matter who writes the check to the insurance company--the buyer pays for the bond in the end--figuratively, literally, or otherwise.

        I second Brian's comment--what's at stake is too great. In my opinion, it's a prudent business decision that we should make even if it's not forced. From talking to our commercial lines agents here, small mfr with good financials shouldn't get dinged for more than 2% of the contract price. If the 5% mentioned earlier was right (and not a typo), might indicate a less than stellar bonding risk. Cause for concern??? You be the judge.
        earl

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