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Contract bond

South Dakota Supply Bond

Under SDCL 5-21-1, a contractor who contracts to furnish material or labor for a public improvement in South Dakota must furnish surety of at least the contract price for faithful performance and prompt payment of its own suppliers. Supply contracts that are not for a public improvement are set by the buyer's contract.

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Bond at a glance
South Dakota Supply BondContract bond
Required by state law
LawSDCL 5-21-1
AmountNot less than the contract price
Applies toContracts for the construction of a public improvement or the furnishing of material or labor for it
Required byThe public body awarding the contract
How it works

Three steps to your bond.

  1. 01Apply onceTell us about your business and what the bond is for. One application covers most contractor bonds.
  2. 02The surety reviews itPropeller Bonds, our surety partner, reviews your application and sets the terms. We show you the terms before you commit.
  3. 03Sign and fileSign the bond and file it with whoever requires it: the project owner, agency or court. We help with the filing.
About this bond

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 South Dakota

Under SDCL 5-21-1, a contractor who contracts to furnish material or labor for a public improvement in South Dakota must furnish surety of at least the contract price for faithful performance and prompt payment of its own suppliers. Supply contracts that are not for a public improvement are set by the buyer's contract.

  • Under SDCL 5-21-2, a public corporation that fails to require this surety can be liable to unpaid laborers and suppliers.

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.

FAQs

Common questions.

Does South Dakota law require supply bonds?

Usually the contract or the buying agency sets it, not a statewide law. The bid or contract documents state the amount.

What does it cost?

You pay a premium, not the bond amount. The surety sets the premium after it reviews your application, usually as a percentage of the bond amount. We show you the terms before you commit.

How do I get one through BLDAssure?

Apply once with us. We collect the details the surety needs, Propeller Bonds (our surety partner) reviews the application and issues the bond, and we help you file it with whoever requires it.

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Other South Dakota bonds.

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South Dakota Bid Bond

A bid bond is a guarantee you submit with your bid.

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Contract bond

South Dakota Performance & Payment Bond

Performance and payment bonds usually come as a pair once you win a job.

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Contract bond

South Dakota Maintenance Bond

A maintenance bond, also called a warranty bond, guarantees your finished work is free of defects in materials and workmanship for a set period, often one or two years.

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By state

Supply bonds in other states.

Alabama supply bondAlaska supply bondArizona supply bondArkansas supply bondCalifornia supply bondColorado supply bondConnecticut supply bondDelaware supply bondDistrict of Columbia supply bondFlorida supply bondGeorgia supply bondHawaii supply bondIdaho supply bondIllinois supply bondIndiana supply bondIowa supply bondKansas supply bondKentucky supply bondLouisiana supply bondMaine supply bondMaryland supply bondMassachusetts supply bondMichigan supply bondMinnesota supply bondMississippi supply bondMissouri supply bondMontana supply bondNebraska supply bondNevada supply bondNew Hampshire supply bondNew Jersey supply bondNew Mexico supply bondNew York supply bondNorth Carolina supply bondNorth Dakota supply bondOhio supply bondOklahoma supply bondOregon supply bondPennsylvania supply bondRhode Island supply bondSouth Carolina supply bondTennessee supply bondTexas supply bondUtah supply bondVermont supply bondVirginia supply bondWashington supply bondWest Virginia supply bondWisconsin supply bondWyoming supply bond

Sources

  1. SDCL 5-21-1, surety bond required on public improvements
  2. SDCL 5-21-2, public corporation's liability for failure to require bond

General information, not legal advice. Rules change; confirm the current requirement with the agency or owner that asks for the bond. Facts checked Oct 23, 2026.

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