Bonding - (Rev. 5, 08-30-02)

140 - Bonding - (Rev. 5, 08-30-02) A1-1424, B1-4422 The contractor is required to have a fidelity bond on, as a minimum, each certification and disbursement employee. Blanket bonds are an acceptable alternative. Bonds must protect against at least the risks contained in the contractor's agreement (specified in the article entitled "Certification and Disbursement and Indemnification"). As a general rule, the amount of the bond should equal 1/10 of the monthly limitation of the letter of credit but not exceed $500,000. CMS accepts a bond in excess of $500,000 and assumes an allocated share of its total cost if the contractor determines that a larger bond is desirable. No deductibles are permitted with respect to coverage, risks, and amounts.