Contractors who predominantly work
in residential construction have little
need for surety bonds. But bonding is
important for people who want to
break into government work or who
want to build doctors' buildings, professional
offices, and other commercial/
industrial projects. If a contractor is
going to get into development himself
– for example, by developing small
retail stores – he may want to know
about bonding his subs, thereby
guaranteeing their contracts with him.
The federal government started
bonding as we know it in the 1930s
when it was pumping money into the
economy by building. The government
sought a way to guarantee that its
projects would be built as specified. Its
answer was the Miller Act in 1934,
which