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ROBERT L. EHRLICH, JR., Governor S.B. 391
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13-216.
(a) Except as provided in subsection (b) of this section, a procurement officer
may not require a contractor to provide a performance bond, payment bond, or other
security on a procurement contract for construction, construction related services,
services, or supplies if the price of the procurement contract is $100,000 or less.
(b) A procurement officer shall require a contractor to provide a performance
bond, payment bond, or other security if federal law or a condition of federal
assistance requires the security.
(c) If the price of a procurement contract for construction exceeds $100,000, a
procurement officer shall require a contractor to provide security as required under
Title 17, Subtitle 1 of this article.
(d) A procurement officer may require a contractor to provide a performance
bond or other security on a procurement contract for supplies, services, or
construction related services if:
(1) circumstances warrant security; and
(2) the price of the procurement contract exceeds $100,000.
17-104.
(a) Payment security or performance security required under this subtitle
shall be:
(1) a bond executed by a surety company authorized to do business in the
State;
(2) A BOND EXECUTED BY AN INDIVIDUAL SURETY THAT MEETS THE
REQUIREMENTS OF SUBSECTION (C) OF THIS SECTION;
[(2)] (3) cash in an amount equivalent to a bond; or
[(3)] (4) other ANOTHER FORM OF security:
(I) AUTHORIZED BY FEDERAL OR STATE REGULATION; OR
(II) that is satisfactory to the public body awarding the contract.
(b) (1) Subject to paragraphs (2) and (3) of this subsection, performance
security may include the granting of a mortgage or deed of trust on real property
located within the State if such security is satisfactory to the public body awarding
the contract.
(2) The face amount of a mortgage or deed of trust on real property
granted as security under this subsection may not exceed 75% of the contractor's
equity interest in the property.
(3) A mortgage or deed of trust accepted under this subsection shall be
recorded by an official designated by the public body accepting the mortgage or deed
- 3083 -
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