The Oklahoma Bar Journal October 2026

of who bears the burden of ensur ing that the statutorily required bond is in place, a public entity or its officers may not be held liable for the failure to secure the bond. 50 Builder’s Risk Insurance A municipality may require a contractor to maintain builder’s risk insurance to cover damage from fire or weather during con struction in an amount sufficient to protect the municipality’s inter est in the project until the work is completed and accepted. 51 No municipality may require or attempt to require a contractor to obtain required bonds or insurance from a specific insurance com pany, surety, agent, or broker. Any contract provision or bid document that conflicts with this prohibition is against public policy and is void. A violation of this provision also constitutes a misdemeanor. 52 Assignment Restrictions A contract may not be assigned by the successful bidder without the written consent of the munic ipality, approved by a resolution. A contract may not be assigned to any bidder who was previously determined by the municipality to be not responsible during the bid evaluation process. 53 Partial Payments and Retainage Contracts must allow partial payments based on work com pleted but may withhold up to 5% as retainage. After the contractor has completed more than 50% of the project, and the munic ipality determines the work is Prohibition on Forced Insurance Providers PAYMENTS, RETAINAGE AND INTEREST

notice, not to exceed 60 days. If an administrative error is discovered after the award but before execution, the municipality may suspend exe cution, correct the error, or rescind the award and rebid the project, with the issue addressed by the gov erning body at a public meeting. 47 required statutory bonds equal to the contract price and maintain public liability and workers’ com pensation insurance as specified in the bid documents, and the munic ipality may allow up to 60 addi tional days to obtain the bonds. 48 “The fundamental objective of the bond statutes is twofold - [1] protecting laborers and mate rialmen on public construction projects who have no lien rights against public land or improve ments, and [2] saving the public from all liability for liens for mate rial and labor furnished on public improvements.” 49 It is the respon sibility of the bidder to know the bonding requirements. Regardless Bonds and Insurance Contractors must provide

within 30 days after bids are opened, unless the municipality approves a reasonable extension for good cause; otherwise, bidders may withdraw without penalty. Any extension may not exceed 15 days when only state or local funds are involved, or 90 days when federal funds are used for the project. The award period may be extended up to a total of 120 days from the bid opening date if the extension is agreed to in writing by both the lowest responsible bidder and the awarding public agency. 46 The award period may be extended by formal action for good cause, longer when federal funds are involved, and up to 120 days only with written agreement of the municipality and the lowest respon sible bidder; otherwise, the bids must be rejected and the project rebid.

CONTRACT EXECUTION AND PERFORMANCE Execution Deadlines and Admin Errors

The contract must be executed within the time stated in the bid

Statements or opinions expressed in the Oklahoma Bar Journal are those of the authors and do not necessarily reflect those of the Oklahoma Bar Association, its officers, Board of Governors, Board of Editors or staff.

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THE OKLAHOMA BAR JOURNAL