New Jersey Performance BondThe Statute Writes the Wording, Not Just the Amount

New Jersey is unusual among states: its bonding statute does not just set an amount, it prescribes the bond wording itself. N.J.S.A. 2A:44-147 says the bond must be "in substantially the following form," binding principal and sureties "in the penal sum of ___ dollars," conditioned that the contractor "shall well and faithfully do and perform the things agreed to be done and performed" under the contract, and "shall pay all lawful claims of beneficiaries." The statute also protects the surety with a no-modification clause: changes to the contract, plans, or specifications do not release the surety from the bond. A bond drafted with generic boilerplate instead of this statutory language can be rejected by the contracting board or officer before your bid is even opened -- so the form itself is worth checking, not just the number.

Sometimes, but only within narrow dollar windows, and only at the discretion of the awarding body -- there is no automatic exemption. Under N.J.S.A. 2A:44-143, State contracts may have the bond requirement waived only if the contract does not exceed $200,000. For contracting units (counties, municipalities) and school districts, that waiver ceiling drops to $100,000. Above those figures, the bond is not optional -- the statute requires the board, officer, or agent to demand it. Below the ceiling, waiver is a choice the awarding body makes, not a right the contractor can invoke. Always read the bid specifications; many public bodies require bonds well under the waiver threshold anyway.

New Jersey ratchets surety qualification standards by contract size. On bonds between $850,000 and $3.5 million, the surety must either hold a U.S. Treasury Department certificate of authority (Circular 570) or, if it has operated more than five years, carry a top-three financial-strength rating from a nationally recognized rating company. Above $3.5 million, both apply: a Treasury certificate is mandatory, plus the top-three rating requirement if the surety has five-plus years of operating history. Under $850,000, New Jersey still requires the surety to meet baseline capital and surplus minimums under R.S. 17:17-6 or R.S. 17:17-7, just not the Treasury-listing tier. Practically: as your contract value crosses $850,000 and then $3.5 million, fewer sureties qualify to write the bond, which is one reason larger New Jersey public jobs can take longer to place.

No -- NJ Transit construction contracts for public buildings, works, or improvements are bonded under the same statute as county, municipal, and school district work: N.J.S.A. 2A:44-143. NJ Transit sets its own bond percentage (up to 100% of the contract price) in the bid documents based on project risk, and it retains discretion to waive the requirement the same way other public bodies do, weighing the scope of work, bidder availability, and financial capability. What does not change is the surety qualification rule: NJ Transit bonds, like every other public bond in the state, must come from a company listed in the current U.S. Treasury Circular 570 and authorized to transact surety business in New Jersey.

No, and mixing the two up is a real underwriting mistake. Your performance bond, written under N.J.S.A. 2A:44-143 through 147, guarantees completion of the contract and payment of labor and material claims, sized at up to 100% of the contract price. A separate instrument exists under the New Jersey Prevailing Wage Act (N.J.S.A. 34:11-56.25 et seq.): the Commissioner of Labor and Workforce Development can require a contractor to post a wage-compliance surety bond, payable to the State, protecting workers if the contractor fails to pay the prevailing wage. That bond is capped at $10,000 per worker and is a registration condition with the Department of Labor -- it does nothing to satisfy your project performance bond, and your performance bond does nothing to satisfy that registration requirement. Public-works contractors frequently need both.

The contracting board, officer, or agent reviewing your bid package can reject a bond that departs materially from the N.J.S.A. 2A:44-147 form -- and because the bond is typically due with or shortly after the bid, a rejected bond can mean a rejected bid, with no time left to fix it before the deadline. The safest approach is to have your surety or agency issue the bond on a form built specifically for New Jersey public contracts, not a generic multi-state template. If you’re unsure whether a bond you’ve been handed matches the statutory conditions -- penal sum language, the "well and faithfully perform" clause, the beneficiary payment clause, and the no-modification protection for the surety -- have it reviewed before the bid opens, not after.

Request a quote with the form on this page. A licensed agent submits your application to a Treasury-listed surety carrier; once the carrier issues your bond, file it as the requiring agency directs.

A licensed agent reviews your request and submits it to the carrier; most quotes come back within one business day. The carrier decides approval and the final premium, and you pay only when your bond is issued.