§ 200.304 - Bonds.

§ 200.304 Bonds.

The Federal awarding agency may include a provision on bonding, insurance, or both in the following circumstances:

(a) Where the Federal Government guarantees or insures the repayment of money borrowed by the recipient, the Federal awarding agency , at its discretion, may require adequate bonding and insurance if the bonding and insurance requirements of the non-Federal entity recipient are not deemed adequate to protect the interest of the Federal Government.

(b) The Federal awarding agency may require adequate fidelity bond coverage where the non-Federal entity recipient lacks sufficient coverage to protect the interest of the Federal Government's interest.

(c) Where bonds, insurance, or both are required in the situations described above, the bonds and insurance must be obtained from companies holding certificates of authority as acceptable sureties, as prescribed in issued by the U.S. Department of Treasury (see 31 CFR part 223).