Recent Changes to Bond and Claim Notice Requirements on Virginia Public Construction Projects

04/27/2011

Credit for this article goes to my law partner, John Lockard, who prepared it as part of his recap of the 2011 General Assembly session. This summarizes two significant changes to Virginia’s Little Miller Act.

During the 2011 Session the Virginia General Assembly passed two important changes to bond and claim requirements on Virginia Public Construction Projects. HB 1951, effective 7/1/11, raised the minimum amount required for bid, performance and payment bonds. The new minimum contract amount increased from $100,000 to $500,000 for non-transportation construction projects. If the bond requirement is waived on projects between $100,000 and $500,000 the prospective contractors must be prequalified.

This means that subcontractors and vendors on non-transportation construction projects under $500,000 should not assume that a bond is in place and should investigate that issue before agreeing to payment and credit terms. SB 1424, effective 7/1/11, reduced the time within which lower tier subcontractors and vendors must provide notice to the contractor from 180 days to 90 days. Therefore, any claimant that has a contract relationship with a subcontractor or vendor, but no contract relationship with the contractor may only pursue a payment bond claim if it first gives written notice to the contractor within 90 days from the day on which the claimant performed the last of the labor or furnished the last of the materials for which it claims payment.

– nsl

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