Wisconsin’s public-works bond thresholds look like a typing error the first time you see them. They are not, and what they tell you is worth more than the numbers themselves.
Two figures, and neither is round
Wis. Stat. § 779.14 states them in two paragraphs:
“In the case of a contract with a contract price exceeding $369,000 the contract shall require the prime contractor to obtain a payment and performance bond meeting the requirements under par.”
“(4) , in the case of a contract with a contract price exceeding $148,000 the contract shall require the prime contractor to obtain a payment and performance bond meeting the requirements under par.”
Set those beside the rest of the country. Idaho picks fifty thousand dollars. Texas picks one hundred thousand. Illinois picks one hundred and fifty thousand. North Dakota picks two hundred and fifty thousand. Legislatures choosing a threshold choose round numbers, because a threshold is a policy judgment and policy judgments are expressed in round figures.
Wisconsin’s are not round, which is the signature of a figure that has been adjusted rather than chosen — indexed and restated, the way the federal acquisition threshold sits at $150,000 under FAR 28.102-1(a) on top of the $100,000 that 40 U.S.C. § 3131(b) actually says.
The practical consequence is a warning about citation. A round threshold is easy to remember and usually stays put for decades. An adjusted one is a moving figure that happens to be sitting where it is today, and anybody quoting Wisconsin’s numbers from memory a few years from now is likely to be quoting a superseded figure. Read the statute.
The two paragraphs also apply to different classes of contract, and this page does not say which — the quoted text points at paragraphs we have not read, and inventing the distinction would be worse than naming the gap.
Substitution, but only after the award
Wisconsin’s most useful provision for a contractor is also its most carefully fenced:
“The department of administration may allow a prime contractor to substitute a different payment and performance assurance for the payment and performance bond only after the contract has been awarded and only if the substituted payment and performance assurance is for an amount at least equal to the contract price and is in the form of a bond, an irrevocable letter of credit or an escrow account acceptable to the department of administration.”
Four constraints, and every one of them matters.
Only the Department of Administration may allow it. Not the contracting body generally.
Only after award. This is the fence that changes how the provision is used. You cannot bid on the strength of an instrument you intend to substitute in — at bid time the requirement is a payment and performance bond, and your ability to meet it is assessed on that basis. The substitution is a change to a job you already have.
At least the contract price. Substituting does not reduce the exposure; it relocates it.
Three named forms, and the department must find the instrument acceptable. A bond, an irrevocable letter of credit, or an escrow account.
Compare the alternatives elsewhere. Oklahoma’s 61 O.S. § 1 puts the letter of credit beside the bond from the outset, as an equal at bid time. Pennsylvania’s 8 P.S. § 193 does the same for a defined contracting body. Wisconsin keeps the bond as the entry requirement and opens the alternatives afterwards — which is a materially different thing for a contractor whose bank capacity is stronger than its surety capacity, because it does not help you win the work.
One year from completion of the work
“(am) , no later than one year after the completion of work under the contract, any party in interest, including any subcontractor, supplier, or service provider, may maintain an action in that party’s name against the prime contractor and the sureties upon the bond for the recovery of any damages sustained”
The period is a year, as it is federally under 40 U.S.C. § 3133(b)(4), in Maine under 14 M.R.S. § 871 and in South Carolina under S.C. Code § 11-35-3030. The event it runs from is different, and the difference cuts in the claimant’s favor.
The federal clock runs from the day the claimant last performed labor or supplied material. Wisconsin’s runs from the completion of work under the contract — the job, not your part of it. A supplier who delivers in month three of a two-year contract is out of time federally long before the job ends; in Wisconsin that supplier’s year has not started.
An accompanying annotation states the same rule from the claimant’s side: a subcontractor can maintain an action against the prime contractor and the prime’s surety if the claim is brought within one year after completion of work on the principal contract.
The claimant class is drawn broadly too — “any party in interest, including any subcontractor, supplier, or service provider”. Service providers are named, which most statutes leave to argument.
The affidavit in Wis. Stat. § 779.08 belongs to a different chapter
One provision of Wis. Stat. § 779.08 turns up alongside these and is worth separating out precisely because it does not belong to the bond requirement:
“779.08(2) (2) If an undertaking is furnished, it shall be accompanied by the affidavit of the surety which states that the surety is worth, over and above all debts and liabilities in property within this state not exempt from execution, an amount in the aggregate equal to 125 percent or more of the amount of the claim for lien.”
That is the lien chapter — an undertaking given in connection with a claim for lien, and the affidavit is about the surety’s net worth, not about a penal sum. It is the only place in our reading where a statute asks a surety to swear to its own solvency at a stated multiple.
It is not the amount of a Wisconsin public-works performance bond, and reading it as one would be a mistake this section makes easy.
The proposal guaranty, and whether you get it back
Wisconsin calls the thing you post with a bid a proposal guaranty, and the rule for it is in the municipal public-works chapter, Wis. Stat. § 66.0901, not in the bond section above.
Two instruments are named there: a proposal guaranty, and, separately, a certified check. As elsewhere, the choice is not cosmetic — a certified check is money the municipality holds, and a guaranty is an undertaking that holds nothing.
What makes Wisconsin worth reading is not the size of the guaranty. It is that the statute contemplates an argument about giving it back, and sets the standard for winning that argument:
“If the discovery and notice of a mistake, omission or error causes a forfeiture, the bidder may not recover the moneys or certified check forfeited as liquidated damages unless it is proven before a court of competent jurisdiction … that in making the mistake, error or omission the bidder was free from carelessness, negligence or inexcusable neglect.”
Three things are doing work in that sentence.
The forfeiture is treated as liquidated damages — an agreed sum, not a measure of what the municipality actually lost. Recovery is a matter for a court of competent jurisdiction, so this is litigation, not an administrative appeal to the letting authority. And the standard the bidder must meet is stated in the negative and set high: free from carelessness, negligence or inexcusable neglect. A bidder who made an honest arithmetic slip has not obviously cleared that bar, because carelessness is exactly what an arithmetic slip usually is.
Most states leave what happens to forfeited bid security to the bond form and to general contract law. Wisconsin puts the question in the statute and answers it in a way that favors the municipality — the money stays forfeited unless the bidder proves its mistake was a blameless one.
This page does not state when a Wisconsin proposal guaranty is required or how large it must be. Wis. Stat. § 66.0901 was read for the forfeiture mechanic and the named instruments; the triggering condition and the amount were not recovered from it, and a figure we have not read is a figure this page will not print.
What Wis. Stat. § 779.14 leaves elsewhere
The threshold sentences both end by pointing at paragraphs — “meeting the requirements under par.” — that we have not read. Those paragraphs contain the actual bond requirements, which means this page can tell you when a Wisconsin bond is required and not how large it must be. That is an unusual gap and we would rather name it than fill it from a neighboring state.
The section also does not give the notice a claimant must serve before suing, and the bid-security rules for Wisconsin public work sit in the procurement provisions rather than here.
