City of Santa Monica Faithful Performance Bond

What is the Purpose of the Faithful Performance Bond?

The City of Santa Monica requires contractors performing construction in the city affecting a public right-of-way to obtain a Faithful Performance Permit Bond. The bond represents a financial guarantee by the contractor and the issuing surety company to the City of Santa Monica that all contracted work will be completed on time and the jobsite will be returned to its original condition.

How Much Does the Bond Cost?

Per Municipal Code 7.06.430, the bond shall be in a penal sum prescribed by the Director or the Building Officer conditioned upon the repair, in the manner directed by and strictly in accordance with the requirements of the Director, of any and all damage: (1) to private property (other than utilities) which in the opinion of the Director or Building Officer was wholly or partially caused as a direct or indirect result of any work under such permit; and (2) to public ways, other public property, substructures and utilities, which in the opinion of the Director or Building Officer was wholly or partially caused as the direct or indirect result of any work under such permit, or alternatively the payment of the cost of any such repairs, made by the City or owner of any utility, or both.

The bond cost for the contractor is typically between 1%-7.5% depending on the contractor’s personal credit score.

*Prices shown are based on several factors. Not all available pricing tiers are shown. Rates do not constitute an offer of bonding and are subject to change at any time.

How Does the Permit Application Process Work With the City of Santa Monica?

Before a permit is issued, a written application must be filed with the Public Works Department. The application must include details regarding the location of all proposed work locations and the extent of the excavation. Municipal Code 7.06.060.

Does CCIS File the Bond for Applicants?

City of Santa Monica requires wet signatures** on filed bond documents. This means both parties must physically sign the bond prior to sending it in to the City of Santa Monica. The original bond form issued by CCIS needs be mailed to or dropped off at the following location by the contractor once signed:

**Properly review bond forms to confirm if notarization is required. Failure to adhere to document requirements may lead to rejection of the bond form by the City of Santa Monica.

Does This Bond Expire?

The permit bond expires upon the specified expiration date, typically one year from the date of issuance. A new permit bond will need to be purchased should the project take longer than one year.

Claims Information

If the City of Santa Monica files a claim against the Faithful Performance Permit Bond, the Surety company will investigate the legitimacy of the claim and proceed accordingly. CCIS does not handle surety claims in office, however, claims contact information will be provided to the contractor, to move the claims process forward.

If the claim is found to be legitimate, the Surety company will payout to the City of Santa Monica, up to the limit of the bond. 

Unlike insurance policies that protect contractors from unforeseen events, this bond protects the City of Santa Monica, its laborers, and suppliers from the actions of a contractor. Contractors are responsible for their actions and therefore must reimburse the Surety company for any claims paid. Failure to do so will significantly inhibit a contractor’s ability to obtain a surety bond for future jobs.