(1) If an agency requires bid or proposal security and/or contract performance security, the types of security that may be used are those specified in 18-4-312, MCA.

(2) The department will supply bid and proposal security bond forms and contract performance security bond forms when security is required. These are the only acceptable forms for surety bond or irrevocable letter of credit submission.

(3) Facsimile, electronic or photocopy copies of bid or contract security are not acceptable.

(4) Certificates of deposit or money market certificates will not be accepted as security for bid, proposal, or contract security unless the certificates are assigned only to the state.

(5) Factors to consider in requiring bid/proposal security and in determining the amount of the security include:

(a) type of commodity;

(b) past state experience;

(c) labor required to perform contract;

(d) materials required to perform contract.

(6) All negotiable instruments provided as bid security and proposal security will be returned to the unsuccessful bidders/offerors within 30 days from date of the award.

(7) Factors to consider in requiring contract performance security and in determining the amount of security include:

(a) type of commodity;

(b) past state experience;

(c) labor required to perform contract;

(d) materials required to perform contract;

(e) amount and number of subcontracts;

(f) damages chargeable to the state if the contractor defaults; and

(g) estimated dollar amount of total contract.

(8) All contract performance security, except bonds, will be returned to the successful bidder or offeror upon completion of the contract, or at the discretion of the procurement official as documented to assure contract completion, or warranty period as declared within the contract.