SFAA Strongly Supports Bill Requiring Change Order Payments to Small Construction Contractors
July 11, 2022 (WASHINGTON, DC) – The Surety & Fidelity Association of America (SFAA), a nonprofit, nonpartisan trade association representing all segments of the surety and fidelity industry, commends Congressman Pete Stauber (MN), Congressman Marc Veasey (TX), Congressman Scott Peters (CA), and Congressman Brian Fitzpatrick (PA) for introducing the Small Business Payment for Performance Act. This bipartisan bill will require fair and ethical treatment of small construction contractors by federal agencies during the procurement process. Changes to a contract, commonly known as “change orders,” inevitably occur during construction projects and the government may issue change orders without the contractors’ knowledge or consent. This bill will:
- Allow small businesses to request an equitable adjustment to the contracting officer if the contracting officer places a change order without the agreement of the small business.
- Require the federal government to pay at least 50% of the cost that occurred from the change order upon receipt of the equitable adjustment.
“SFAA strongly supports this bill and commends the bill sponsors for recognizing small contractors’ need for timely payments for change orders, as they are contending with record inflation and supply chain disruptions. This bipartisan legislation will make public procurement fairer for small contractors and help remove the risk and financial burden of owner-directed changes to these small businesses,” said SFAA president and CEO, Lee Covington.
The Surety & Fidelity Association of America (SFAA) is a nonprofit, nonpartisan trade association representing all segments of the surety and fidelity industry. Based in Washington, D.C., SFAA works to promote the value of surety and fidelity bonding by proactively advocating on behalf of its members and stakeholders. The association’s more than 450 member companies write 98 percent of surety and fidelity bonds in the U.S. For more information visit www.surety.org.