Sureties prevent Texas project losses; e-mails show fiscal concerns | Contractor chosen by surety is completing N.C. facility | Report cites fraud in self-certification for women-owned firms
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March 7, 2013
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Sureties prevent Texas project losses; e-mails show fiscal concerns
Several road projects across Texas were stalled when the contractor in charge of them filed for bankruptcy protection. E-mails between government officials and the company show that concerns arose even before the company stopped operating in December. The projects, however, were covered by sureties that have protected Texas and the city of San Antonio from losses associated with the defaults. KSAT-TV (San Antonio) (2/26)
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Contractor chosen by surety is completing N.C. facility
A building project in North Carolina is closer to being finished a few months after a bonding company picked a new contractor to complete the job. The project began almost four years ago, but the original contractor ran into financial problems and was ultimately unable to meet its obligations. The $5.6 million project's features will include a solar-panel heating system. Watauga Democrat (Boone, N.C.) (3/1)
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Report cites fraud in self-certification for women-owned firms
Auditors say they have uncovered instances in which businesses received NASA contracts after the firms were improperly self-certified as being owned by women. Companies must meet size requirements and have women as their majority owners or primary managers to qualify as women-owned small businesses. The auditors reported finding "evidence that daily business operations were actually controlled and managed by the male spouse of the purported business owner." FierceGovernment (3/4)
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Consultant: Feds' "sources sought" notices can benefit small firms
Sequestration could take a chunk out of the federal government's spending on contracting, so small businesses must prepare for the impact of the cuts, according to this blog post. Business owners should weather sequestration by taking such steps as examining procurement forecasts and looking for "sources sought" notices on FedBizOpps, the blog post suggests. GovWin/Lourdes Martin-Rosa's blog (3/5)
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Other News
Policy Update
Officials: Train procurement staff for good purchasing decisions
Lawmakers and experts at a recent congressional hearing discussed the need for procurement professionals to get the training and support necessary to make intelligent purchasing decisions. Lawmakers are working on a measure aimed at solving procurement problems by providing more training for information-technology acquisition personnel, among other changes. Federal Computer Week (3/1)
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NASBP March 19 Virtual Seminar: "Unraveling the Knot of Trusts and Surety Indemnification"
Join us from 2 to 3 p.m. Eastern time on Tuesday, March 19, for the NASBP Virtual Seminar "Unraveling the Knot of Trusts and Surety Indemnification." Presenters John Coyne, a vice president and regional underwriting officer for Travelers Bond and Financial Products, and Kimberly Bowden Czap, Esq., managing director and counsel for Travelers, will take the mystery out of the trust as a vehicle for construction company ownership and will assist surety professionals in identifying the key areas for effective surety indemnification. Trusts, once typically associated with large and complex organizations, are becoming more commonplace for construction contractors. While trust ownership presents several benefits to indemnitors, sureties have often been apprehensive concerning the adoption of a trust, particularly in regard to the surety's indemnification rights. Understanding why a trust is established and the parties empowered to obligate the trust are critical to obtaining the proper indemnity. In addition, Coyne and Czap will address the increasing use of trusts and the challenges posed to sureties, identifying and evaluating risks associated with the most common forms of trusts, and setting forth the steps to properly underwrite and secure the indemnity obligations of the trust. Consider inviting your clients to join you at your office for this Virtual Seminar. Registration for each Virtual Seminar is $69 per site. Register now.
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Register now for NASBP Legislative Fly-in on Thursday, June 20
The co-chairs of the NASBP Legislative Fly-in, Lawrence McMahon of Alliant Insurance Services and William Maroney of Wells Fargo Insurance Services USA, encourage NASBP members, affiliates and associates to register now for the June 20 NASBP Legislative Fly-in, to be held in Washington, D.C. Plan to meet with your members of Congress on Capitol Hill for the annual NASBP Legislative Fly-in, which will begin with a program featuring an issue orientation and a policy briefing in the morning at the Hyatt Regency Washington on Capitol Hill, within walking distance of the U.S. Capitol as well as the Senate and House office buildings. Program speakers will include elected and governmental officials. The afternoon will be dedicated to Capitol Hill appointments, followed by a cocktail reception. For more information about the fly-in, contact Larry LeClair at Plan to show your passion for surety to your federal lawmakers on June 20 by registering now for the NASBP Legislative Fly-in.
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Market Trends
Study: Insurance-agency M&A deals totaled 291 last year
A study has found that 291 mergers and acquisitions took place among insurance agencies in the U.S. and Canada last year. "Buyers were anxious to acquire and sellers equally anxious to complete their deals before capital-gains-tax rates went up in 2013," one expert said. PropertyCasualty360 (2/27)
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The saddest aspect of life right now is that science gathers knowledge faster than society gathers wisdom."
-- Isaac Asimov,
Russian-born American author and biochemist
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Founded in 1942, NASBP is the association of and resource for surety bond producers and allied professionals. NASBP producers specialize in providing surety bonds for construction contracts and other purposes to companies and individuals needing the assurance offered by surety bonds.
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