The Miller Act

 The Federal Law That Requires Bonding on Government Construction Projects

If you're a contractor who wants to bid on federal construction work, the Miller Act is the law you need to understand. It's the reason performance and payment bonds are required on virtually every federal construction contract - and it's been shaping how the government manages construction risk since 1935.

The Miller Act isn't complicated, but the details matter. Knowing what it requires, who it protects, and how it affects your ability to bid and win federal work is fundamental to competing in public construction. This page covers the law in plain English - what it says, how it's applied, and what it means for contractors at every level.

 What Is the Miller Act?

The Miller Act is a federal statute, codified at 40 U.S.C. §§ 3131–3134 , that requires contractors on federal construction projects to furnish both a performance bond and a payment bond before the contract is awarded. Originally enacted in 1935 to replace the earlier Heard Act of 1894, it was recodified in 2002 but its core requirements have remained consistent for nearly a century.

The statute itself sets the bonding threshold at contracts exceeding $100,000. However, the Federal Acquisition Regulation (FAR), which implements the Miller Act's requirements in practice, sets the bonding threshold at $150,000 for construction contracts. For contracts between $35,000 and $150,000, the FAR provides alternative forms of payment protection instead of a full payment bond. For contracts over $150,000, both a performance bond and a payment bond are mandatory.

In practical terms: if you want to bid on any federal construction contract worth more than $150,000, you must be able to provide performance and payment bonds. No bond, no bid.

Before you can win that contract, you typically submit a bid bond with your proposal, then provide the performance and payment bonds once the job is awarded.

 Why Does the Miller Act Exist?

The Miller Act addresses two problems that are unique to government construction.

First, the government needs assurance that contractors will complete the work. When a contractor abandons a federal project or fails to perform, it doesn't just create a financial loss - it delays critical public infrastructure, disrupts services, and wastes taxpayer dollars. The performance bond guarantees that if the contractor defaults, the surety will step in to ensure the project gets finished.

Second, subcontractors and material suppliers need a way to get paid. On private construction projects, unpaid subs and suppliers can file mechanics' liens against the project property to secure their payment. But on federal projects, you can't file a lien against government property - sovereign immunity prevents it. Without the Miller Act, subcontractors working on federal jobs would have no practical recourse if the general contractor failed to pay them. The payment bond fills that gap by giving them a direct claim against the surety.

The U.S. Small Business Administration recognizes the importance of this framework and operates a Surety Bond Guarantee Program specifically to help small contractors who might otherwise struggle to obtain the bonds required under the Miller Act.

 What Bonds Does the Miller Act Require?

The Miller Act requires two bonds on qualifying federal construction contracts: a performance bond and a payment bond.

The performance bond protects the federal government. It guarantees that the contractor will complete the project in accordance with the terms of the contract. If the contractor defaults, the surety is obligated to resolve the situation - typically by financing a replacement contractor, providing financial assistance to the original contractor, or compensating the government for its losses. The performance bond amount is set by the contracting officer at a level they consider adequate to protect the government's interest, which in practice usually means 100% of the contract value.

The payment bond protects subcontractors, laborers, and material suppliers. It guarantees that the contractor will pay all downstream parties who provide labor and materials on the project. The payment bond amount must equal the total contract value unless the contracting officer determines that a bond in that amount is impractical, in which case they can set a different amount - but it can never be less than the performance bond amount.

Both bonds must be furnished before the contract is awarded and become binding when the contract is signed. They must be issued by a surety satisfactory to the contracting officer, which in practice means a surety company listed on the U.S. Department of the Treasury's Circular 570   - the official list of approved sureties for federal bonds.

 Learn more about Performance Bonds

 Learn more about Payment Bonds 

 Who Does the Miller Act Apply To?

The Miller Act applies to prime contractors - the contractors who enter into a direct contract with the federal government. If you're awarded a federal construction contract over $150,000, you're the one who must furnish the bonds.

Subcontractors are not required to provide Miller Act bonds to the government. However, many general contractors require their subcontractors to carry bonds as a condition of the subcontract, particularly on larger or more complex projects. This is a contractual requirement, not a Miller Act requirement - but it operates on the same principle. The GC wants the same assurance from their subs that the government wants from the GC.

The Miller Act covers contracts for the construction, alteration, or repair of any public building or public work of the federal government. This includes new construction, renovation, infrastructure work, facility maintenance, and any other project that involves physical work on government property or public works. It does not apply to supply contracts, service contracts, or contracts that don't involve construction.

 Payment Bond Claim Rights Under the Miller Act

One of the most important practical aspects of the Miller Act for the construction industry is the payment bond claim process. If you're a subcontractor or supplier working on a bonded federal project and you haven't been paid, the Miller Act gives you a specific legal path to recover your money.

It also gives you a clock. Miss it and the claim is gone, no matter how right you are about the money.

The two 90-day rules that get confused

There are two separate 90-day rules in the Miller Act, they do different jobs, and contractors mix them up constantly.

The 90-day waiting period applies to everyone. No claimant can file suit until 90 days have passed since the last day they furnished labor or materials. That window exists to give the prime contractor and the surety a chance to settle up before anyone goes to court.

The 90-day notice requirement applies only to second-tier claimants. If you contracted with a subcontractor rather than with the prime, you must give the prime contractor written notice of your claim within 90 days of your last day of work or delivery. The notice needs to state the amount claimed and name the party you contracted with.

Two details decide cases here. The notice must actually be received by the prime inside the 90 days, not simply mailed on day 89 (Pepperburn's Insulation, Inc. v. Artco Corp., 970 F.2d 1340, 4th Cir. 1992). And for a second-tier claimant the notice is a condition precedent, which is the legal way of saying no notice, no claim, regardless of the merits.

First-tier claimants who contract directly with the prime do not have to send that notice. Send one anyway. It often gets the invoice paid without a lawsuit, and if it doesn't, it shows the court you tried.

Who is actually covered

Miller Act payment bond protection reaches the first and second tiers only. If you have a direct contract with the prime, you're covered. If you have a contract with a first-tier subcontractor, you're covered.

Below that, the protection stops. A supplier to a second-tier subcontractor has no Miller Act claim, and neither does a sub-subcontractor further down the chain. Suppliers to suppliers are not protected either. Perfect notice does not fix a tier problem.

This is worth knowing before you sign, not after you're unpaid. If you're taking work three levels down on a federal job, the payment bond is not standing behind you, and you should be pricing and securing that risk some other way.

The one-year deadline, and what does not extend it

Every Miller Act payment bond claim must be filed in federal court within one year of the last day the claimant performed work or supplied materials. Combined with the 90-day waiting period, that leaves a practical nine-month window to file.

Going back to the site to do repair or warranty work does not restart that clock. Neither does a punch list item or a courtesy fix. The date that counts is the last day of your original contract work, which is frequently earlier than contractors assume.

Keep dated delivery tickets and daily logs on every federal job. When a payment fight starts eight months later, that paperwork is what establishes your last-furnishing date, and the date is the whole case.

 Learn more about how Payment Bond claims work

 Little Miller Acts - State and Local Bonding Requirements

The Miller Act applies only to federal construction projects. But its framework was so effective that virtually every state has enacted its own version, commonly called a "Little Miller Act," imposing similar bonding requirements on state and local government construction projects.

If you bid public work for a state, a county, a city, a school district, or a water district, you are working under a Little Miller Act, not the federal one.

What changes from state to state

Four things move: the contract dollar threshold that triggers bonding, which bonds are required and in what amount, the notice procedure for making a claim, and the deadline to file suit. A contractor who assumes the federal rules carry over to a state job is the contractor who misses a notice deadline.

Why the dollar threshold you found online is probably wrong

Most bonding charts print one dollar figure per state. That single number is the most common error in public construction bonding, because in a lot of states the figure in the statute is not a bond trigger at all. It turns out to be one of four other things.

A waiver ceiling. Washington, South Carolina and Mississippi all require bonds with no dollar floor and then allow an exemption underneath a figure. Washington lets the contractor ask to leave 10 percent retainage instead of a bond at $150,000 or less. South Carolina lets the governmental body waive both bonds at $50,000 or less. Mississippi lets the owner elect a lump sum at completion under $25,000. Written up as "bonds required over $X," each of those is wrong twice: bonds do exist below the figure, and the exemption above it is optional rather than automatic.

A bidding threshold. The North Dakota figure in wide circulation came out of the state's competitive bidding statute. The bond requirement is a different section with a different number.

A figure that re-indexes itself. Pennsylvania adjusts its thresholds every single year against a federal construction cost index, which means the amounts printed in the Pennsylvania statute have been stale since 2002. Nebraska re-indexes its state building figure every four years. In states like these the citation is right, the statute is right, and the number is still wrong.

One of two or three numbers. Arizona has no dollar floor for county and city work but a threshold for state agency work. New Hampshire runs $75,000 for state contracts and $125,000 for local ones. North Carolina requires the project total to clear $300,000 and your own contract to clear $50,000, both tests rather than either one.

The bond amount moves too, and it is not always 100 percent of the contract. Alabama's payment bond is at least 50 percent. Illinois and Missouri set no percentage at all and leave the amount to the awarding body. Tennessee's statute says 25 percent, Idaho's 85 percent, Colorado's and Nevada's 50 percent. New Mexico starts at 100 percent and lets the purchasing office cut it to 50.

Citations go stale in a different way. One widely repeated Wyoming citation points at a subsection that was repealed in 2016, and it is not a bond statute at all. It survives online because an older version of the real statute happened to cross-reference it. That is why the table below leads with the statute and the structure instead of a single number, and why every citation in it is a link to the law itself.

Little Miller Act requirements in the 30 states Grit is licensed in

Every citation in the "Read the law" column links straight to the statute so you can read it yourself rather than take our word for it. Where we have read a state's claim and limitations sections, those are linked too.

The deadline that catches people is the one that starts early

The threshold tells you whether you need a bond to bid. The notice and suit deadlines decide whether you actually collect. Almost every contractor we talk to carries the same mental model, borrowed from the federal Miller Act: ninety days from my last day on the job. In a third of these states that model will lose the claim, because the clock does not start when you finish.

Seven states start it when you show up, and Washington gives you ten days. If you supply a subcontractor on Washington public work you have to notify the contractor within 10 days of your first delivery, and the statute says flatly that no suit against the contractor or the bond can be maintained without it. That is the shortest notice in this table by a wide margin. Montana wants notice within 30 days of first delivery, in the exact form the statute prints, and says plainly that "any other type of actual or constructive notice is not sufficient." Michigan wants one within 30 days of your first day of work, and then a second within 90 days of your last, sent to the contractor and the governmental unit both. Nevada gives 30 days from first furnishing. Arizona wants a 20-day preliminary notice before the 90-day one. Ohio wants a sworn statement to the sureties within 90 days from everyone, and a separate notice of furnishing on top of that once your work passes $30,000 and you are not contracting directly with the prime. Wyoming wants notice to the general contractor within 60 days of your first delivery on any job over $150,000, and the penalty for missing it is not a delay, it is losing the bond. In every one of those states a contractor who waits until the job is over has already lost.

Four states start it when the OWNER acts, not when you do. Washington gives 30 days from the owner's formal acceptance of the work, filed with the public body, and without it you have no right of action on the bond at all. Montana gives 90 days from acceptance, also filed with the public body. Tennessee gives 90 days from completion of the public work, itemized. New Hampshire gives 90 days from completion and acceptance, filed with the Secretary of State, the DOT, Administrative Services or a superior court clerk depending on who let the job. Colorado gives 90 days from a final-settlement date the owner has to publish in a newspaper. If you finished your scope eight months before the project did, you are waiting on somebody else's paperwork to start your clock, and you have to be watching for it.

Washington and Montana are in both groups. On either one, a supplier to a subcontractor owes an early notice off its own first delivery and a later filing off the owner's acceptance. Miss either and the claim is gone.

Texas asks every month. Texas is alone here. You mail the prime and the surety a notice by the 15th day of the third month after each month you worked, with a sworn statement of account. Not once at the end. Every month.

The outer deadlines swing just as wide. Kansas and Tennessee both give six months, the shortest here, and Kansas asks for no notice at all along the way. Colorado gives 90 days from a published date. Oregon gives two years, the longest, but demands a notice within 180 days from every claimant, even one that contracted directly with the prime. Oklahoma gives one year, or two if you filed a claim inside the first. North Carolina gives whichever of two one-year clocks runs longer. Texas runs its payment-bond year from the date you mailed your own notice.

And in four states the bond statute sets no deadline to sue at all. Missouri, Montana, Nebraska and Washington leave it to the general statute of limitations, which depends on how the claim is characterized. That is not a licence to relax. In Washington the notices are absolute bars, so the claim is usually decided long before any limitations question arises.

Two provisions worth knowing because they work in your favor. Virginia voids a waiver of your right to sue on the payment bond unless you signed it after the work was done, so the waiver buried in the subcontract you signed up front does not bind you there. South Carolina lets an early notice of furnishing raise your ceiling, because a remote claimant's recovery is otherwise capped at whatever the bonded contractor still owes the party you supplied. And one that works against you: Wyoming shares the bond out pro rata among everyone in the action, so being slow means splitting rather than recovering in full.

Tier coverage is not uniform either. New Mexico case law reaches third-tier suppliers. Mississippi's statute stops at the second tier by its own terms. Oklahoma reaches a sub of any tier. The federal Miller Act stops at the second tier.

How to handle it if you bid in more than one state

Check the actual solicitation first. Public owners state their bond requirements in the bid documents, and that language governs the job in front of you regardless of what a summary chart says.

Then confirm the claim deadlines for that state before you need them, not after. The bonding threshold tells you whether you need a bond to bid. The notice and suit deadlines are what protect the money once you're on site, and those are the ones contractors discover too late.

Grit is licensed in 30 states and writes surety nationally. We handle the federal Miller Act jobs and the state Little Miller Act jobs, and we tell contractors which rules apply to the specific project they're bidding. If you are bidding public work in a state you have not worked before, call us at (801) 505-5500 before you sign and we will walk the thresholds and the deadlines with you.

 See contractor bond requirements by state

 How the Miller Act Affects Your Bonding Strategy

If you're a contractor who wants to compete for federal work - or state and local government work under a Little Miller Act - bonding isn't optional. It's a prerequisite. And the contractors who treat bonding as a strategic asset rather than an administrative hurdle are the ones who grow their federal project portfolios most successfully.

Building a bond program before you need it is the single most important step. Contractors who wait until they find a federal project to bid and then scramble to get bonded often miss deadlines, pay higher premiums, or get declined because their financials aren't organized. Contractors who have an established surety relationship, pre-approved bonding capacity, and current financial documentation on file can move on opportunities quickly - often getting a bid bond issued the same day.

Strengthening your financial profile directly increases your ability to compete for federal work. Every dollar of working capital, every point on your credit score, and every successfully completed bonded project builds the capacity that allows your surety to back larger bonds. The Miller Act requirement isn't just a hurdle - it's a market filter that keeps unqualified contractors from competing for the work. If you're bonded, you're in a smaller, more qualified competitive pool.

 How Contractors Qualify for Bonds

 Contractor Bond Programs

 Increase Your Bonding Capacity

 Contractor Bond Readiness Review 

The Miller Act requires both a performance bond and a payment bond on covered federal jobs. For how the two differ, see performance bond vs payment bond.