FAR 28.1—Subpart 28.1

Scope of subpart.

FAR 28.100 is the scope statement for FAR Subpart 28.1, and it tells readers what this subpart governs: the use of bonds, alternative payment protections, and all types of bid guarantees. In practice, this means the subpart is the starting point for understanding when and how the Government may require or accept surety bonds, other payment-protection arrangements in place of bonds, and bid security used in connection with sealed bidding or other solicitations. The section does not itself set out the detailed rules for each instrument; instead, it frames the coverage of the subpart and signals that the operative requirements and procedures appear in the later sections. For contracting officers, it is a reminder to look to this subpart whenever a procurement involves construction or other situations where payment protection or bid security may be needed. For contractors and sureties, it identifies the universe of protections and guarantees that may affect proposal submission, award eligibility, and contract performance.

Bid guarantees.

Performance and payment bonds and alternative payment protections for construction contracts.

Performance and payment bonds for other than construction contracts.

Annual performance bonds.

FAR 28.104 addresses annual performance bonds for nonconstruction contracts and explains how they work when a contractor has multiple covered contracts over a period of time. The section establishes that these bonds are limited to nonconstruction work, must carry a gross penal sum that applies to the total amount of all covered contracts, and may need to be supplemented if the amount already obligated under covered contracts approaches or reaches the bond’s penal sum. In practice, this provision is meant to give the Government a continuing performance security mechanism without requiring a separate bond for every individual contract, while still ensuring the bond amount remains sufficient as additional contracts are awarded. It matters because contracting officers must monitor the aggregate value of covered contracts against the bond limit, and contractors must understand that one annual bond does not create unlimited coverage. The section is short, but it has an important administrative purpose: it ties bond sufficiency to the running total of covered obligations and prevents undersecured performance risk.

Other types of bonds.

FAR 28.105 addresses the use of bond types other than the standard bid, performance, and payment bonds when the Government is acquiring particular supplies or services. It gives the head of the contracting activity authority to approve these alternative bonds, which the section identifies as including advance payment bonds and patent infringement bonds. The purpose is to give agencies flexibility to protect the Government’s interests when a procurement presents risks that are not adequately covered by the usual bond forms. In practice, this means a contracting office cannot simply decide on its own to require an unusual bond; the decision must be tied to the specific acquisition and approved at the proper organizational level. For contractors, this section matters because it can add financial security obligations beyond the normal bonding requirements and may affect pricing, financing, and proposal strategy. For contracting officers, it is a reminder to use these instruments selectively and only when justified by the nature of the supply or service being acquired.

Administration.