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Bid security

Bid security is the guarantee a bidder includes with its bid, such as a bid bond, certified check or cashier's check, which the county can keep if the winning bidder fails to sign the contract.

"Bid security" is the general term; a bid bond is the most common form. Counties set the amount, usually a percentage of the bid.

State examples

  • Iowa public improvements: at least 5% and no more than 10% (Iowa Code 26.8).
  • Indiana public works: required over $200,000 estimated cost, up to 10% (IC 36-1-12-4.5).

Checks from unsuccessful bidders are returned after the award. The winner's security is returned once it signs the contract and provides its performance and payment bonds.

Sources

Last reviewed Oct 30, 2026. This is general information, not legal advice. Laws and thresholds change; check the current statute and the bid documents.

What Is Bid security? | FactWise