The Engineering Division of the City of Tuscaloosa, Alabama is tasked with protecting the city’s people and lands by regulating construction within the city. Among those regulations, contractors completing public infrastructure improvements are required to secure a surety bond. There are two bonds: the Performance Bond and the Maintenance Bond.
The Performance Bond is a requirement for a land disturbing permit and guarantees that work is carried out to completion within the two-year permit term. The Maintenance Bond covers maintenance of public improvements for a minimum of one year after the public infrastructure improvements have been accepted by the City.
Jet Insurance Company offers this bond as a financial guarantee to the City that compensation is available should a contractor fail to complete a job or maintain a project according to the permit.
The cost depends on the bond limit, as well as a review of personal credit and financial statements. With Jet, the price you pay for the bond will only be a small percentage of the bond limit required.
The Performance Bond limit is equal to 1.10 times, or 110%, of the public infrastructure improvement costs, not including improvements to water distribution systems.
The Maintenance Bond limit is equal to 10% of the public infrastructure improvement costs. However, the City Engineer may increase the bond amount if information indicates that the improvements do not meet minimum standards.
You can find the bond limit calculator (excel sheet) here.
Applying with Jet simplifies the bonding process. Our application asks for basic information, including the required bond limit. We conduct a quick review of the submitted information and conduct a soft credit check to get you an approved rate. If additional information is needed, we will let you know. Once an approved rate is ready, it will be sent to you via email and can be purchased directly online. After purchase, a copy of the bond and your receipt is available.
The bond is to be filed with the City of Tuscaloosa, which Jet can do for you. If you need to file the bond yourself, perhaps with other paperwork, you can choose to have the bond sent to you during checkout. All paperwork is to be sent to the following address:
City of Tuscaloosa
2201 University Blvd
Tuscaloosa, AL 35401
Performance and Maintenance Bonds must be active for the duration of your work. This means the bonds cannot be cancelled, and you and the surety company (Jet) are liable under your bond until released by the City. Liability is released after a project is completed and an inspector has approved the work and/or maintenance.
The land disturbing permit is good for a maximum of two years, and the Performance Bond must line up with the permit. Jet will notify you (via mail and email) at the end of the first year to remit payment to keep the bond active, if necessary. Maintenance Bonds are issued at a minimum period of one year but may extend beyond that. You will receive a notice for the renewal of the Maintenance Bond, and as long as payment is provided, your bond will remain on file with the City of Tuscaloosa. If you have questions regarding renewal, please email us at [email protected] or give us a call at 855-296-2663.
If a contractor abides by the permit obligations and the City of Tuscaloosa, Alabama Subdivision Regulations, claims can be easily avoided. An example of a bond claim is the contractor fails to install the last wearing surface layer within two years of the final plat being signed. The City may tap the bond for payment to complete public infrastructure improvements
Oftentimes, the City will give you a chance to fix any issues prior to the bond being used as restitution. For example, regarding the Maintenance Bond, at least 30 days prior to the expiration of the maintenance period, the City Engineer conducts an inspection of the improvements. Should the inspection show wear and tear beyond the “norm”, the City Engineer will notify the contractor or developer to allow them to correct the issues before utilizing the bond for compensation.
If a claim gets passed along to Jet, we will do our due diligence to ensure no false claims are being paid out. However, any valid claims will result in a bond claim payout for which you are responsible to pay back. This is because the bond acts as an extension of credit, guaranteeing your performance to the City. One you have a claim, you will be faced with future difficulties getting a permit and bond needed to work, whether it is in the City of Tuscaloosa or any other city within the State of Alabama.
Contractors may need additional bonding in the City of Tuscaloosa, or even on a state level, depending on the type of work being done. Contact Jet for your other bond needs.