Pricing & Bonds

Question 1

What are UNIT PRICES good for?

Answer 1

Best tool for COST CONTROL, and comparing contractor base bids for materials whose PRICE AND SCOPE are UNKOWN at the time of bidding.

Question 2

PAYMENT BOND

Answer 2

-Guarantees that subcontractors, material suppliers, and laborers get paid.

-Protects the owner against mechanics’s liens.

Question 3

ALLOWANCE

Answer 3

Dollar amount given to an item not yet selected.

Question 4

What is BID SECURITY?

Answer 4

A certified check submitted with the bid by the contractor. Owner keeps the check if contractor fails to take on the project.

Question 5

What is a BID BOND?

Answer 5

• Obtained by the contractor from an insurance company that asserts it will pay the difference between the contractor’s price and the next lowest bidder if the original contractor does not take the job.
• Protects the owner from being stuck with a high bidder.

Question 6

What is a PAYMENT BOND?

Answer 6

Protects owners from liens and guarantees payment for subcontractors.

Question 7

PERFORMANCE BOND

Answer 7

A statement by a SURETY COMPANY that obligates complete construction of the project in the event the contractor defaults and cannot finish the work.

Question 8

UNIFORMAT

Answer 8

A system for classifying building products and systems by functional subsystem (e.g. substructure, superstructure, exterior enclosure, etc.)