A Little Miller Act is an essential piece of legislation regulating surety bonds for construction companies contracting with state governments for construction, public works, transportation and repair projects. These acts vary from state to state and are referred to as “Little,” because they’re based on a federal statute called the Miller Act.
If you’re seeking to expand your contracting business and grow it to compete at a higher level, you’ll need to understand what these acts are and how they work, so you can be sure to carry the right surety bonds for the job. Let’s explore the Texas Little Miller Act, the bonds it requires you to carry and where you can go to make sure you’re always in compliance with this important state statute.
Miller Act Origins
As far back as the 1890s, the Federal government recognized the necessity to protect itself against irresponsible contractors that would sign onto a job and then not finish. It established the Heard Act at this time. The Heard Act required contractors on Federal jobs to carry a payment and performance bond that would cover the government and subcontractors if the job didn’t get completed.
Unfortunately, the Heard Act was severely limited and difficult to enforce, so by 1935, the stronger and still current Miller Act was passed. It states that if you work a government job at a certain value ($100,000 to $150,000 or higher), you will need to be properly bonded for performance and payment of goods and services vendors.
The Little Miller Acts
Not long after the Miller Act was established, states began to realize the importance of the protections it offered at the federal level and started to pass their own statutes based upon it. These statutes are colloquially and collectively known as Little Miller Acts. Like the federal level act, they provide for contractors to carry performance bonds and payment bonds to protect the contracting body as well as any vendors and subcontractors with whom they work.
Essentially, should you take on a job and for whatever reason you can’t complete it, the government can file a bond claim against the act to recoup some of their losses. In addition, your vendors and subcontractors can file claims to ensure they get paid.
The Texas Little Miller Act
As one of the largest, most populous states in the Union, Texas has a strong Little Miller Act to protect state interests. Any contractor who works on a public works, repair, rebuilding or construction project in the state is required to furnish both a payment bond and a performance bond under the Texas Little Miller Act in Title 10, Subtitle F, Chapter 2253 of the State Government Code. Such a bond must be furnished before work commences.
Learning More about Little Middle Acts
If you’d like more information about the Texas Little Miller Act or about any Texas surety bonding services, NSSI is here to help. For over 20 years we’ve offered safe, secure and fast bonding to contractors all over the nation. Give us a call to get started today.