Surety bonds • New York
New York Public Works Payment Bonds (State Finance Law § 137)
New York State Finance Law § 137 requires contractors on public improvement contracts to provide a payment bond guaranteeing prompt payment to everyone who furnishes labor or materials. Agencies may waive the bond on contracts under $100,000. Subcontractors’ suppliers must give notice within 120 days of their last work, and suits must be filed within one year after the owner completes and accepts the project.
This guide covers when the bond is required, who it protects, the notice and suit deadlines, and cost. Blake Insurance Group is an independent agency and does not give legal advice; a licensed agent can help contractors set up bonding.
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When a § 137 payment bond is required
Under N.Y. State Finance Law § 137, a contractor on a public improvement contract for the state, or let by a municipal corporation, public benefit corporation, or commission, must provide a payment bond before the contract is approved. The bond guarantees prompt payment of money due to all persons furnishing labor or materials to the contractor or its subcontractors. Agency heads may waive the bond on contracts under $100,000 when bids are solicited.
Who the bond protects
Anyone who furnished labor or materials for the work and has not been paid in full may sue on the bond, including trustees who collect benefit payments for workers (N.Y. State Finance Law § 137). The public owner is protected separately, often by a performance bond.
Notice and suit deadlines
- 120-day notice. A claimant with a contract with a subcontractor, but not with the contractor, must give the contractor written notice within 120 days after the last labor was performed or materials were furnished, stating the amount claimed and who the work was for, delivered personally or by registered mail.
- One-year suit deadline. No action on the bond may be started more than one year after the public owner completes and accepts the improvement, unless Labor Law § 220-g provides otherwise.
Source: N.Y. State Finance Law § 137. Deadlines are strict, so claimants should get legal advice early.
How much a New York payment bond costs
Payment bonds are usually written together with the performance bond and priced as one premium, commonly about 0.5% to 3% of the contract amount based on the contractor’s finances and experience (NASBP). See our payment bond guide for more.
New York public works payment bond FAQs
When is a payment bond required in New York?
On public improvement contracts covered by State Finance Law § 137, although agencies may waive it on contracts under $100,000.
How long do I have to give notice on a New York payment bond?
Claimants without a direct contract with the contractor must give written notice within 120 days after their last labor or materials.
How long do I have to sue on a New York payment bond?
One year after the public owner completes and accepts the improvement, unless Labor Law § 220-g provides otherwise.
Related guides
- New York surety bonds
- Payment bonds
- Performance bonds
- Florida public construction bond
- Surety bonds
- Surety bond cost
- Surety bond cost calculator
- Buy a surety bond online
- South Dakota public works bond
- West Virginia public works bond
- New Mexico public works bond
- Nebraska public works bond
- Kansas public works bond
- Iowa public works bond
- Oklahoma public works bond
- South Carolina public works bond
- Alabama public works bond
- Tennessee public works bond
- Washington public works bond
- Michigan public works bond
- Pennsylvania public works bond
- New Jersey public works bond
- Illinois public construction bond
- Georgia public works bond
- Virginia public works bond
- North Carolina public construction bond
- Ohio public improvement bond
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