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    Volume 45, Issue 4 (July 2017)

    Bond Requirements on State-Owned Forest Land in the Western United States

    (Received 1 October 2015; accepted 18 May 2016)

    Published Online: 20 July 2017

    CODEN: JTEVAB

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    Abstract

    State forestry agencies typically require forestry contractors to furnish several types of bonds before beginning work on state land. Required bonds often include: performance bonds that help ensure contract provisions are followed satisfactorily, bid bonds that guarantee follow-through by the winning contractor, and payment bonds that guarantee payment for timber before cutting. Much variety exists both in the types of bonds that are required and the form of payment that state forestry agencies will accept. However, no single source for this information exists in the literature. Such a resource can help assist state foresters when determining bond requirements for their own state, as well as providing a comparison with other state policies. To meet this need, a literature review and telephone survey of state forestry agencies was conducted. The literature review revealed varying statutory requirements and an absence of research on bonding practices in the forestry industry. Survey respondents reported performance bond requirements, when in effect, ranging from 5 % to 100 % of the contract price in service contracts, and from 5 % to 20 % in timber sale contracts. Bid guarantees, if required by state agencies, range from 2 % to 10 % of the contract price. The unique conditions involved in forest management require flexibility when it comes to bonding policies to avoid burdening agencies and contractors with unnecessary constraints.


    Author Information:

    Vaughan, D.
    Dept. of Forest and Rangeland Stewardship, Colorado State Univ., Fort Collins, CO

    Mackes, K.
    Dept. of Forest and Rangeland Stewardship, Colorado State Univ., Fort Collins, CO

    Eckhoff, M.
    Dept. of Forest and Rangeland Stewardship, Colorado State Univ., Fort Collins, CO


    Stock #: JTE20150425

    ISSN:0090-3973

    DOI: 10.1520/JTE20150425

    Author
    Title Bond Requirements on State-Owned Forest Land in the Western United States
    Symposium ,
    Committee E02