How is combined performance and payment bond cost calculated?

On Miller Act federal jobs and most state public-works jobs, the performance bond covers 100% of the contract and the payment bond covers another 100% — 200% of the contract value total. Premium is charged on the contract amount once (not twice), typically 0.5%–3% depending on credit and experience.

Do I pay premium on both bonds separately?

No. When the bonds are issued together on the same contract, sureties charge a single premium based on the contract amount. The payment bond rides along at no additional cost on nearly every surety market.

When are both bonds required?

The Miller Act statute (40 USC §3131) technically applies to contracts over $100,000, but FAR 28.102-1(a) is the practical working threshold for federal construction — requiring both bonds on contracts over $150,000. Between $35,000 and $150,000, FAR 28.102-1(b) allows alternative payment protections (irrevocable letters of credit, etc.) instead of bonds. State Little Miller Act thresholds range from $50K to $250K.

Last reviewed: April 23, 2026|Next review due: July 22, 2026|Reflects current Performance and Payment bond calculator requirements

✓ 2026 Requirements Verified

Miller Act · Combined P&P · 0.5%–3%

Performance & Payment Bond Cost Calculator

For Miller Act, Little Miller Act, and private public-works contracts. One premium covers both bonds.

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Miller Act & Little Miller Act Thresholds

Federal construction contracts over $150,000 require both performance and payment bonds under 40 USC 3131 (Miller Act). State “Little Miller Act” thresholds vary — California kicks in at $25K for payment bonds, Texas at $100K, Florida at $200K. When in doubt, check the solicitation’s bond requirements.

Need separate calculators? See Performance Bond Calculator or Payment Bond Calculator. Starting with a bid? Use the Bid Bond Calculator first.

Related Resources

P&P Bonds Guide

Miller Act Requirements

Bonding Capacity Calculator

Construction Bond Calculator

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Surety review by Eric Drummond, Surety Specialist

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