Form Con - Biennial License Renewal For General Contractor - With Residential Endorsement - Alaska Department Of Community And Economic Development Page 5
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5CONTRACTOR BONDING AND INSURANCE
Section 08.18.071. Bond required. (a) Each applicant shall, at the
Section 08.18.115. Return of cash deposit. (a) A contractor who
time of applying for a certificate of registration, file with the commissioner
has filed a cash deposit and who ceases doing business as a contractor
a surety bond running to the state conditioned upon the applicant's
may request the return of as much of that cash deposit as is held by the
promise to pay
commissioner by
(1) all taxes and contributions due the state and political
(1) filing a notarized statement with the commissioner that the
subdivisions;
contractor has ceased doing business as a contractor; and
(2) all persons furnishing labor or material or renting or supplying
(2) filing a notarized statement with the commissioner at least
equipment to the applicant; and
three years after filing the statement in (1) of this subsection which
(3) all amounts that may be adjudged against the applicant by
(A) requests return of the cash deposit;
reason of negligent or improper work or breach of contract in the conduct
(B) certifies that the former contractor has not been engaged
of the contracting business or by reason of damage to public facilities
in business as a contractor for at least three years; and
occurring in the course of a construction project.
(C) certifies that to the best of the contractor's knowledge no
(b) If the applicant is a general contractor, the amount of the bond
action has been commenced upon the cash deposit which has not been
shall be $10,000; if the applicant is a mechanical or specialty contractor,
dismissed or reduced to a final judgment which has been satisfied.
the amount of the bond shall be $5,000. In lieu of the surety bond, the
(b) The commissioner, after paying any judgments against the cash
applicant may file with the commissioner a cash deposit or other
deposit under AS 08.18.081(b), shall return the remainder of a former
negotiable security acceptable to the commissioner in the amount
contractor's cash deposit to the contractor if
specified for bonds.
(1) the former contractor has complied with (a) of this section; and
(c) The bond required by this section remains in effect until canceled
(2) no action has been commenced upon the cash deposit which
by action of the surety, the principal, or the commissioner. An action may
has not been dismissed or reduced to a final judgment which has been
not be commenced upon the bond later than three years after its
satisfied.
cancellation.
12 AAC 21.090. NEGOTIABLE SECURITY IN PLACE OF SURETY
Sec. 08.18.081. Claims against contractor. (a) A person having a
BOND. (a) When a negotiable security is filed with the commissioner in
claim against a contractor for any of the items referred to in AS 08.18.071
place of the bond as provided in AS 08.18.071(b), the owner of the
may bring suit upon the bond in the district court of the judicial district in
security shall execute an assignment of the security to the state which is
which venue lies. A copy of the complaint shall be served by registered
attached to and becomes a part of the security.
or certified mail upon the commissioner at the time suit is filed and the
(b) The following negotiable securities are acceptable for the
commissioner shall maintain a record, available for public inspection, of
purposes of AS 08.18.071(b):
all suits commenced. Two additional copies shall be served upon the
(1) for a specialty contractor, a time certificate of deposit in the
director of the division of insurance with the payment to the director of a
face amount of $5,000 issued by a bank or trust company authorized to
fee set under AS 21.06.250, taxable as costs in the action. This service
do business in Alaska, and meeting the requirements of 12 AAC 21.120;
upon the director shall constitute service on the surety and the director
and
shall transmit the complaint or a copy of it to the surety within 72 hours
(2) for a general contractor, a time certificate of deposit in the face
after it has been received. The surety upon the bond is not liable in an
amount of $10,000 issued by a bank or trust company authorized to do
aggregate amount in excess of that named in the bond, but in case claims
business in Alaska, and meeting the requirements of 12 AAC 21.120.
pending at any one time exceed the amount of the bond, the claims shall
(c) Negotiable securities other than those listed in this section, filed for
be satisfied from the bond in the following order:
the purposes of AS 08.18.071(b), will be considered on a case-by-case
(1) labor, including employee benefits;
basis.
(2) taxes and contributions due the state, city and borough, in that
(d) The assignment required under (a) of this section must be on a
order;
form provided by the department.
(3) material and equipment;
(e) When either cash or a negotiable security filed in accordance with
(4) claims for breach of contract;
this section and AS 08.18.071(b) is accepted by the commissioner in the
(5) repair of public facilities.
place of the surety bond required by AS 08.18.071, it shall remain filed
(b) If a judgment is entered against the cash deposit, the
with and pledged to the state for the purposes of AS 08.18.071 for a
commissioner, upon receipt of a certified copy of a final judgment, shall
period of three years after
pay the judgment from the amount of the deposit, in accordance with the
(1) the effective date of a surety bond in like amount written in
priorities set out in (a) of this section.
compliance with AS 08.18.071;
(2) the lapse without reinstatement of the certificate of registration;
Sec. 08.18.091. Cancellation of bond. This chapter does not impair
or
the right of a bonding company to cancel its bond of a contractor for lawful
(3) the suspension or revocation without reinstatement of the
reasons.
certificate of registration.
Sec. 08.18.101. Insurance required. Each applicant, at the time of
12 AAC 21.120. CASH DEPOSITS INSTEAD OF BOND. (a) A
applying for registration or upon renewal of registration, shall file with the
certificate of deposit or other negotiable instrument filed with the
commissioner satisfactory evidence that the applicant has in effect
commissioner instead of bond must
(1) to the extent required under AS 23.30, workers' compensation
(1) show the commissioner as payee and must bear on its face
insurance that is purchased from a private insurer who is admitted to do
the words “In Trust For The State of Alaska” or similar words that allow
business in the state and that shows coverage in this state, appropriate
only the commissioner to negotiate the instrument;
employee classifications, and rates applicable in this state, or a valid
(2) be accompanied by an Assignment of Negotiable instrument
workers' compensation self-insurance certificate issued by the Alaska
signed by the contractor and a bank representative acknowledging
Workers' Compensation Board; and
transfer to the department;
(2) public liability and property damage insurance covering the
(3) be issued for a period of at least three years before maturity,
applicant's contracting operations in this state in the sum of not less than
or if purchased for a shorter period, be automatically renewable; and
$20,000 for damage to property, $50,000 for injury, including death, to any
(4) remain pledged to the state in accordance with 12 AAC
one person and $100,000 for injury, including death, to more than one
21.090(e).
person.
(b) At the time the certificate of deposit filed with the commissioner
matures, the department must receive a letter from the bank or the
Sec. 08.18.111. Advertising bond and insurance. Contractors may
contractor requesting the commissioner to release the certificate to the
not advertise that they are bonded and insured simply because they have
bank for reissue. This letter must include the complete mailing address
complied with the bond and insurance requirements of the chapter.
of the bank.
08-4135a (Rev. 11/02)
Extra Handout Form -G (Internet Version)
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