What a supply bond is
A supply bond guarantees a supplier will deliver materials or equipment as the contract says. Public agencies and project owners use them on large supply contracts.
In New York
New York has no statute specifically requiring a supply bond (a bond posted by a supplier to guarantee delivery of materials). New York State Finance Law § 137 requires prime contractors on public works contracts above $100,000 to post a payment bond protecting subcontractors and material suppliers from nonpayment—this is a different instrument. A supply bond may be required by a public agency or project owner in individual supply contract documents but is not mandated by state law.
- SFL § 137 protects material suppliers as beneficiaries of the GC's payment bond; it does not obligate the supplier itself to post any bond.
- Supply bonds are available from licensed New York sureties when contractually required.
You need this bond if you're
- A material supplier on a public contract
- An equipment vendor or manufacturer
- A distributor supplying a large private project
What the surety looks at
Your business, credit and the supply contract. Large contracts can need financial statements.