Bonding is often cited as the primary barrier to small business participation in public works construction. One of the primary reasons bonding is so difficult to obtain is that the surety companies are writing bonds with the expectation of no defaults, which means the companies seeking bonding must be able to demonstrate capacity, strong financials and good character. Merriwether & Williams Insurance Services has administered contractor development and bonding programs throughout the state for over 21 years and we encourage small businesses to utilize our free services to grow their businesses.
Merriwether-administered programs conduct vigorous outreach in line with sponsor opportunities and priorities and engage targeted businesses in assessment, education, technical assistance and matchmaking with prime partners. Current sponsors include the City and County of San Francisco (including the Airport, Port, Muni, S.F. Public Utilities Commission and public works), City of Los Angeles (including the Airport, Port, Water and Power and public works), L.A. County Metro (with $125 Billion in development and construction projected over the next twenty years) and Alameda County, which has a $580 Million Affordable Housing Bond with a 20% small business inclusion requirement. Each of these sponsors has established a $4 - $8 Million collateral pool, which guarantees any losses from defaults on the bonds issues.
In over 21 years, with over $900 Million in bonding made available to small, women, minority and veteran-owned businesses, all programs combined have experienced less than 1% default rate in an industry with a steady default rate over 20%. Merriwether is proud to be able to assist small and emerging firms who create jobs and economic prosperity in their communities and thank our sponsors who understand the social and economic benefit of inclusion and equity.