Last Updated:April 3, 2026|Reflects current general contractor bond requirements

✓ 2026 Requirements Verified

Miller Act Compliant

Treasury Circular 570 Sureties

SBA Program to $14M

Same-Day License Bonds

General Contractor Bonds

Q: What bonds does the Miller Act require for federal construction contracts?

The Miller Act (40 U.S.C. sections 3131-3134) requires both performance and payment bonds for any federal construction contract exceeding $150,000, per FAR 28.102-1. For contracts between $35,000 and $150,000, contracting officers may accept alternative payment protections. The bonds must be issued by a surety company listed on the Treasury Department's Circular 570 approved surety list. Updated under FAC 2026-01.

Q: How much does a general contractor bond cost?

General contractor license bonds typically cost 0.5% to 3% of the bond amount annually. For a $25,000 California CSLB bond, expect $125-$750/year depending on credit and financials. For project-level performance and payment bonds on federal work, premiums run 0.5%-4% of contract value. The SBA Surety Bond Guarantee Program charges an additional 0.6% fee but enables contractors who cannot obtain traditional bonding to qualify for bonds up to $14 million on federal contracts.

Q: What is the SBA Surety Bond Guarantee Program?

The SBA guarantees surety bonds for small and emerging contractors who cannot obtain bonding through normal channels. As of March 18, 2024, the program covers bonds up to $9 million for non-federal contracts and $14 million for federal contracts (with contracting officer certification). The SBA charges a 0.6% fee on the contract price. The QuickApp process provides same-day decisions for contracts under $500,000.

Q: What is the difference between a general contractor license bond and a performance bond?

A general contractor license bond is required by a state licensing board to ensure compliance with state laws and building codes. It protects consumers and remains in force for as long as the license is active. A performance bond is project-specific, guarantees you will complete a particular construction contract per specifications, and is required by the project owner. Most GCs need both types: the license bond to operate legally, and performance bonds to win bonded projects.

Q: Why is underwriting harder for general contractors than specialty trades?

General contractor bonds involve significantly more underwriting scrutiny because GCs assume total project risk including coordination of multiple subcontractors, scheduling, and overall contract compliance. Specialty trade bonds under $25,000 often qualify on credit score alone, while GC bonds and contract bonds require full financial review including CPA-prepared financial statements, work-in-progress schedules, bank references, and a detailed review of the contractor's experience and capacity.

Q: Can I get a general contractor bond with bad credit?

Yes. Contractors with challenged credit can still obtain license bonds, though premiums will be higher at 3%-10% of bond amount instead of 0.5%-2%. For federal contract bonds, the SBA Surety Bond Guarantee Program specifically targets small and emerging contractors, with bond limits of $9 million (non-federal) and $14 million (federal). Several surety markets specialize in non-standard credit situations.

Q: What states require general contractor license bonds?

Most states require some form of contractor bonding. Notable examples: California requires a $25,000 bond (BPC section 7071.6, updated by SB 607 in January 2023), Oregon requires $80,000 for commercial GCs and $55,000 for specialty contractors (HB 2922, January 2024), Nevada requires $1,000-$500,000 based on volume plus a $100,000 consumer protection bond under AB 39 (October 2023), and North Carolina sets bonds at $175,000 (limited), $500,000 (intermediate), or $1 million (unlimited classification).

Q: What is Treasury Circular 570 and why does it matter?

Treasury Circular 570 is the official list of surety companies certified to write bonds on federal projects. If you need performance, payment, or bid bonds for federal government contracts, the surety issuing your bond must appear on this list. The Treasury Department publishes and updates the list regularly. Working with a Treasury-listed surety ensures your bonds will be accepted by federal contracting officers.

The Miller Act requires performance and payment bonds on every federal construction contract over $150,000. State licensing boards add their own bonding requirements on top. General contractors operate at the intersection of both systems, and that makes bonding the single most important financial qualification in the industry.

Whether you need a state license bond to keep your contractor's license active, or performance and payment bonds to bid on a federal project, we write both from Treasury-certified sureties with rates starting at 0.5%.

$150K

Miller Act Threshold

$14M

SBA Federal Limit

0.5%

Starting Premium

States Covered

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Federal Bonding Under the Miller Act

The Miller Act is the foundational federal statute governing construction bonds. Understanding its requirements is not optional for any GC pursuing government work.

Official Federal Requirements

"The Miller Act requires performance and payment bonds for any construction contract exceeding $150,000 awarded by a federal agency."

Federal Acquisition Regulation • FAR 28.102-1 (FAC 2026-01)

Federal Contract Bond Thresholds

Over $150,000: Both performance bonds and payment bonds mandatory under the Miller Act

$35,000 - $150,000: Contracting officer may accept alternative payment protections

Under $35,000: No bonding requirement for smaller contracts

Treasury Circular 570

Federal contract bonds must be issued by surety companies certified under Treasury Circular 570. This is the official list of sureties approved to write bonds on federal projects. All of our surety partners are Treasury-certified, A.M. Best A-rated or higher.

The Treasury Department updates Circular 570 annually and publishes it on fiscal.treasury.gov. Bonds from non-certified sureties will be rejected by federal contracting officers.

SBA Surety Bond Guarantee Program

The SBA guarantees bonds for small and emerging contractors who cannot qualify through standard underwriting. Limits increased March 18, 2024:

$14 million for federal contracts (with CO certification)
$9 million for non-federal contracts
0.6% fee on contract price
QuickApp: same-day decisions for contracts under $500K

Source: SBA.gov Surety Bond Program

Why General Contractor Bonds Require More Than a Credit Check

Specialty trade bonds under $25,000 often qualify on personal credit alone. General contractor bonds are different. Sureties treat GCs as total-project-risk principals, which triggers a deeper underwriting review at every bond level.

GC Underwriting vs. Specialty Trade Underwriting

What sureties evaluate at each level

Factor	Specialty Trade (<$25K)	GC License Bond	GC Contract Bond (P+P)
Credit check	Yes - primary factor	Yes	Yes
Financial statements	Rarely required	Often required >$50K	CPA-prepared required
Work-in-progress schedule	Not required	Sometimes	Always required
Bank reference / line of credit	Not required	Sometimes	Required
Experience review	Minimal	Moderate	Detailed project history
Personal indemnity	Usually waived <$25K	Required	Required (all owners)
Typical approval speed	Instant / same day	Same day - 3 days	3-10 business days

Contract bond underwriting becomes progressively more detailed as project size increases.

Based on standard surety underwriting practices across major U.S. sureties.

Character

Reputation, integrity, track record of completing projects on time. A revoked license or prior bond claim is a serious red flag for sureties.

Capacity

Largest project completed, technical expertise, equipment owned, workforce depth. Sureties want proof you can handle the work.

Capital

Working capital, net worth, liquidity, profitability. Typical bonding capacity formula: Working Capital x 10-20 = aggregate limit.

Not sure about your bonding capacity? Use our contractor bond calculator to estimate your costs, or request a quote for a personalized assessment.

State License Bond Requirements for General Contractors

Federal bonding is only half the picture. Almost every state requires a separate license bond before a general contractor can legally operate. These amounts and rules vary widely.

North Carolina GC Bond Tiers

Bond amount tied to license classification

Limited

$175,000

Smaller residential and commercial projects

Most Common

Intermediate

$500,000

Mid-range commercial construction

Unlimited

$1,000,000

No project size restrictions

NC Licensing Board for General Contractors

Nevada GC Bond Structure

Volume-based bond + consumer protection (AB 39, Oct 2023)

Most Common

NSCB License Bond

$1K-$500K

Set by Nevada State Contractors Board based on annual volume

Consumer Protection

$100,000

Required under AB 39 for residential contractors

Nevada State Contractors Board / AB 39 (effective October 2023)

California

$25,000

CSLB contractor license bond. Required for all classifications under Business & Professions Code section 7071.6. Updated by SB 607, effective January 2023.

Cost: ~$125-$750/yr depending on credit

Oregon

$80,000

Commercial general contractor bond. Specialty contractors: $55,000. Public works projects over $100,000 require an additional $30,000 bond. Updated by HB 2922, January 2024.

One of the highest state license bond requirements in the U.S.

Georgia

$25,000

General contractor license bond required by the Georgia Secretary of State Division of Licensing.

Cost: ~$125-$750/yr depending on credit

State requirements change frequently

Bond amounts and licensing rules are updated by state legislatures regularly. Oregon raised its GC bond from $75K to $80K in 2024. California increased its bond from $15K to $25K in 2023. Always verify current requirements with your state licensing board before applying.

Need help finding your state's requirements? Read our state-by-state contractor bond requirements guide or browse all contractor bond types.

Every Bond a General Contractor Needs

Most GCs carry multiple bond types simultaneously. Your license bond keeps you legal. Your contract bonds let you compete for real work. Here is the full stack, in the order you will need them.

1. Contractor License Bond

Required by your state licensing board to obtain and maintain your GC license. Protects consumers from code violations, fraud, and incomplete work. Bond amounts range from $1,000 to $2 million depending on state and classification. This is the bond that lets you pull permits.

2. Bid Bond

Guarantees you will honor your bid price and enter into the contract if awarded. Required to submit proposals on most public works and many private bonded projects. Typically 5-10% of the bid amount. No separate premium for most qualified contractors.

3. Performance Bond

Guarantees you will complete the project per contract specifications. Mandatory for federal contracts over $150,000 under the Miller Act. Typically 100% of contract value. Premiums range from 0.5% to 4% depending on contractor qualifications and project risk.

4. Payment Bond

Guarantees you will pay subcontractors, laborers, and material suppliers. Exists because public property cannot be liened, leaving workers without their typical remedy. Always paired with performance bonds on federal work.

Need Performance & Payment Together?

Most federal and state public works projects require both. Get a combined P&P quote and save time.

What General Contractor Bonds Cost

Cost depends on two things: the type of bond and your financial qualifications. License bonds are straightforward. Contract bonds require more underwriting and cost more on larger projects.

License Bond Premiums by Credit

$25,000 License Bond (e.g., California CSLB)

Credit Score	Rate	Annual Cost
740+ (Excellent)	0.5%-1%	$125-$250
680-739 (Good)	1%-3%	$250-$750
600-679 (Fair)	3%-5%	$750-$1,250
Below 600	5%-10%	$1,250-$2,500

Rates vary by surety and state. Higher bond amounts increase dollar cost proportionally.

Contract Bond Premiums (Performance + Payment)

P+P Bond Costs by Contract Value

Contract Size	Typical Rate	Premium Range
$150K-$500K	1.5%-3%	$2,250-$15,000
$500K-$2M	1%-2.5%	$5,000-$50,000
$2M-$10M	0.75%-2%	$15,000-$200,000
$10M+	0.5%-1.5%	$50,000+

SBA-guaranteed bonds add a 0.6% fee on contract price. QuickApp available for contracts under $500K.

Rates reflect standard market pricing. Individual quotes may vary based on contractor qualifications.

Want an exact number? Learn more about surety bond pricing factors or calculate your license bond cost.

Specialty Contractor Bonds

If you hold a specialty trade license instead of (or in addition to) a general contractor license, you may need a trade-specific bond. These carry lower bond amounts and simpler underwriting than GC bonds.

Electrical

License bonds for electricians and electrical contractors

Plumbing

Bonds for plumbers and plumbing contractors

HVAC

Bonds for heating, ventilation, and cooling contractors

Roofing

Bonds for roofing and waterproofing contractors

Mechanical Contractor Bonds|All Contractor Bond Types|Contractor License Bonds Overview

General Contractor Bond FAQs

What bonds does the Miller Act require for federal construction contracts?▼

The Miller Act (40 U.S.C. sections 3131-3134) requires both performance and payment bonds for any federal construction contract exceeding $150,000, per FAR 28.102-1. For contracts between $35,000 and $150,000, contracting officers may accept alternative payment protections. The bonds must be issued by a surety company listed on the Treasury Department's Circular 570 approved surety list. Updated under FAC 2026-01.

How much does a general contractor bond cost?▼

General contractor license bonds typically cost 0.5% to 3% of the bond amount annually. For a $25,000 California CSLB bond, expect $125-$750/year depending on credit and financials. For project-level performance and payment bonds on federal work, premiums run 0.5%-4% of contract value. The SBA Surety Bond Guarantee Program charges an additional 0.6% fee but enables contractors who cannot obtain traditional bonding to qualify for bonds up to $14 million on federal contracts.

What is the SBA Surety Bond Guarantee Program?▼

The SBA guarantees surety bonds for small and emerging contractors who cannot obtain bonding through normal channels. As of March 18, 2024, the program covers bonds up to $9 million for non-federal contracts and $14 million for federal contracts (with contracting officer certification). The SBA charges a 0.6% fee on the contract price. The QuickApp process provides same-day decisions for contracts under $500,000.

What is the difference between a general contractor license bond and a performance bond?▼

A general contractor license bond is required by a state licensing board to ensure compliance with state laws and building codes. It protects consumers and remains in force for as long as the license is active. A performance bond is project-specific, guarantees you will complete a particular construction contract per specifications, and is required by the project owner. Most GCs need both types: the license bond to operate legally, and performance bonds to win bonded projects.

Why is underwriting harder for general contractors than specialty trades?▼

General contractor bonds involve significantly more underwriting scrutiny because GCs assume total project risk including coordination of multiple subcontractors, scheduling, and overall contract compliance. Specialty trade bonds under $25,000 often qualify on credit score alone, while GC bonds and contract bonds require full financial review including CPA-prepared financial statements, work-in-progress schedules, bank references, and a detailed review of the contractor's experience and capacity.

Can I get a general contractor bond with bad credit?▼

Yes. Contractors with challenged credit can still obtain license bonds, though premiums will be higher at 3%-10% of bond amount instead of 0.5%-2%. For federal contract bonds, the SBA Surety Bond Guarantee Program specifically targets small and emerging contractors, with bond limits of $9 million (non-federal) and $14 million (federal). Several surety markets specialize in non-standard credit situations.

What states require general contractor license bonds?▼

Most states require some form of contractor bonding. Notable examples: California requires a $25,000 bond (BPC section 7071.6, updated by SB 607 in January 2023), Oregon requires $80,000 for commercial GCs and $55,000 for specialty contractors (HB 2922, January 2024), Nevada requires $1,000-$500,000 based on volume plus a $100,000 consumer protection bond under AB 39 (October 2023), and North Carolina sets bonds at $175,000 (limited), $500,000 (intermediate), or $1 million (unlimited classification).

What is Treasury Circular 570 and why does it matter?▼

Treasury Circular 570 is the official list of surety companies certified to write bonds on federal projects. If you need performance, payment, or bid bonds for federal government contracts, the surety issuing your bond must appear on this list. The Treasury Department publishes and updates the list regularly. Working with a Treasury-listed surety ensures your bonds will be accepted by federal contracting officers.

Get Your General Contractor Bond

License bonds issued same day. Contract bonds for federal and state projects through Treasury-certified sureties. All 50 states.

Get Your GC Bond Quote

General contractors • All bond types

Pay only after your bond is issued • No obligation • 2 minutes

✓Instant approval•✓A+ rated carriers•✓All 50 states

A+ Rated Carriers

Treasury Circular 570 Listed

SBA Bond Guarantee Available

Reviewed by Nick Thoroughman, Founder

8+ years in surety bond technology. All content is researched from official state and federal sources (.gov) and reviewed for accuracy before publication. BuySuretyBonds.com works with Treasury-certified, A- minimum rated surety carriers serving all 50 states.