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Public Works Desk

Performance bond cost: federal penal sums and your premium

Which bonds FAR Part 28 requires for your contract price, for how much,

and what your surety's own rate schedule makes the premium.

By the Public Works Desk Team · Last verified · How we check every number · Corrections

Source: FAR 28.102-1 General. (48 CFR) (eCFR, current as of 2026-11-10)

$450,000.00performance bond on a $450,000 federal contract
$450,000.00payment bond: 100% of the price too

Over $150,000, FAR 28.102 requires a performance bond and a payment bond,

each normally 100% of the original contract price.

What they cost is the premium, a price your surety quotes; there is no official rate, so we don't publish one.

Type your quote's rate schedule below and each tier is multiplied out.

A contract officer and a general contractor review a thick construction contract and a sealed bond document at a meeting table on a snowy winter day.
Your surety's rate schedule No default rate: check Treasury's Circular 570 list or your surety. A flat rate is one tier with no upper limit.

How the numbers are figured

  1. Which bondsOver $150,000: performance and payment bonds. Over $35,000 up to $150,000: payment protection only. $35,000 or less: none (the solicitation may still ask for other security).
  2. Penal sumEach required bond equals 100% of the original contract price, and grows by 100% of any increase.
  3. PremiumYour quote's tiers, each slice × its rate on screen. The exact amounts are added and rounded once, half-up to the cent (rounding).
  4. No default rateThere is no official premium rate. Your surety sets it; Treasury's Circular 570 lists the sureties accepted on federal bonds.

“requires performance and payment bonds for any construction contract exceeding $150,000”

FAR 28.102-1 General. (48 CFR) · eCFR, current as of 2026-11-10

“100 percent of the original contract price”

FAR 28.102-2 Amount required. (48 CFR) · eCFR, current as of 2026-11-10

“Original contract price does not include the price of any options,

except those options exercised at the time of contract award.”

FAR 28.102-2 Amount required. (48 CFR) · eCFR, current as of 2026-11-10

What this tool does not do

Limits — not legal or insurance advice. We don't publish or suggest a premium rate: your surety sets it based on your company, the job and the market. This applies FAR Part 28 to federal construction contracts. State and local bond laws, bonds on non-construction contracts, bid bond pricing and surety qualification are not covered. For the bid guarantee, see the bid bond guide; to put the premium into the bid, use the bid cost calculator.

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