SF 1673

2nd Engrossment - 87th Legislature (2011 - 2012) Posted on 06/14/2012 11:37am

A bill for an act
relating to performance bonds; modifying a cost threshold relating to public
works contracts; exempting road maintenance on township roads from
performance bond requirements; amending Minnesota Statutes 2010, section
574.26, subdivisions 1a, 2.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2010, section 574.26, subdivision 1a, is amended to read:

Subd. 1a.

Exemptions: certain manufacturers; commissioner of transportation new text begin ;
road maintenance new text end .

(a) Sections 574.26 to 574.32 do not apply to a manufacturer of
public transit buses that manufactures at least 100 public transit buses in a calendar year.
For purposes of this section, "public transit bus" means a motor vehicle designed to
transport people, with a design capacity for carrying more than 40 passengers, including
the driver. The term "public transit bus" does not include a school bus, as defined in
section 169.011, subdivision 71.

(b) At the discretion of the commissioner of transportation, sections 574.26 to
574.32 do not apply to any projects of the Department of Transportation (1) costing less
than deleted text begin $75,000 deleted text end new text begin the amount in section 471.345, subdivision 3 new text end , or (2) involving the permanent
or semipermanent installation of heavy machinery, fixtures, or other capital equipment to
be used primarily for maintenance or repair.

new text begin (c) Sections 574.26 to 574.32 do not apply to contracts for snow removal, ice
removal, grading, or other similar routine road maintenance on town roads.
new text end

Sec. 2.

Minnesota Statutes 2010, section 574.26, subdivision 2, is amended to read:

Subd. 2.

Terms.

Except as provided in sections 574.263 and 574.264 or if the
amount of the contract is deleted text begin $75,000 or deleted text end less new text begin than the amount in section 471.345, subdivision
3 new text end , a contract with a public body for the doing of any public work is not valid unless the
contractor gives (1) a performance bond to the public body with whom the contractor
entered into the contract, for the use and benefit of the public body to complete the
contract according to its terms, and conditioned on saving the public body harmless from
all costs and charges that may accrue on account of completing the specified work, and
(2) a payment bond for the use and benefit of all persons furnishing labor and materials
engaged under, or to perform the contract, conditioned for the payment, as they become
due, of all just claims for the labor and materials. Reasonable attorneys' fees, costs, and
disbursements may be awarded in an action to enforce claims under the act if the action is
successfully maintained or successfully appealed.

Sec. 3. new text begin EFFECTIVE DATE.
new text end

new text begin Sections 1 and 2 are effective the day following final enactment.
new text end