A bond is a written promise of security. At Iowa State University, the use of bid and performance bonds will be at the procurement agent's discretion when they have determined that there is a need to protect the interests of the University. Questions on bonds can be directed to the Procurement Agent the supplier is working with on a given project.
The bid bond would typically be 5% of the estimated budgeted amount for the bid.
A performance bond is required on public improvement (construction) contracts when the contract price equals $25,000 or more. Performance bonds may also be required when the University is relying on the supplier to perform contractually and may potentially suffer losses, should the supplier fail to perform on a contract for goods or services.