Additional Bond Requirements For Residential Pool And Spa Contractors
The 2005 Nevada Legislature enacted Senate Bill 434, effective July 1, 2005 that affects bonding requirements for contractors who perform or will perform work concerning residential pools or spas.
Consumer Protection Bond: Before granting an original contractor’s license to, or renewing the contractor’s license of, an applicant who performs or will perform work concerning residential pools or spas, the Board shall, in addition to any other conditions for the issuance or renewal of a license, require the applicant to file with the Board a bond solely for the protection of consumers in an amount fixed by the Board; or in lieu of filing a bond, establish with the Board a cash deposit as provided in this section.
Failure of an applicant or licensee to file or maintain in full force the required bond or to establish the required cash deposit constitutes cause for the Board to deny, revoke, suspend or refuse to renew a license.
The amount of each bond or cash deposit required by this section must be fixed by the Board with reference to the contractor’s financial and professional responsibility and the magnitude of his operations, but must be not less than $10,000 or more than $400,000.
Payment and Performance Bond: Under certain conditions, the Board may require a residential pool and spa contractor to obtain a performance bond in an amount equal not less than 50 percent of the amount of the contract. The performance bond must be solely for the protection of the owner of the property to be improved. The contractor may also be required to obtain a payment bond in an amount equal to not less than 50 percent of the amount of the contract. The payment bond must be solely for the protection of persons supplying labor or materials to the contractor, or to any of his subcontractors, in carrying out the provisions of the contract. In lieu of a performance or payment bond, the contractor may obtain an equivalent form of security approved by the Board.