Short title

This Act may be cited as the

&short-title1;

Equal surety bond opportunity requirements

(a)

Activities constituting discrimination

It shall be unlawful for any surety to discriminate against any applicant, with respect to any aspect of a surety bond transaction— (1)on the basis of race, color, religion, national origin, sex, marital status, sexual orientation, disability, or age (if the applicant has the capacity to contract); (2)because the applicant has in good faith exercised any right under this Act; (3)because the applicant previously obtained a bond through an individual or personal surety; or (4)because the applicant previously obtained a bond through— (A)any bonding assistance program expressly authorized by law; (B)any bonding assistance program administered by a nonprofit organization for its members or an economically disadvantaged class of persons; or (C)any special purpose bonding program offered by a profit-making organization to meet special needs. (b)

Activities not constituting discrimination

It shall not constitute discrimination for purposes of this Act for a surety— (1)to make an inquiry of marital status if such inquiry is for the purpose of ascertaining the surety’s rights and remedies applicable to the granting of a bond and not to discriminate in a determination of bondability; (2)to make an inquiry of the applicant’s age if such inquiry is for the purpose of determining the amount and probable continuance of bondability; or (3)to make an inquiry as to where the applicant has previously obtained a bond, in order to determine bonding history, or other pertinent element of bondability, except that an applicant may not be assigned a negative factor or value because the applicant previously obtained a bond through— (A)an individual or personal surety; (B)a bonding assistance program expressly authorized by law; (C)any bonding program administered by a nonprofit organization for its members or an economically disadvantaged class of persons; or (D)any special purpose bonding program offered by a profit-making organization to meet special needs. (c)

Additional activities not constituting discrimination

It is not a violation of this Act for a surety to refuse to issue a bond pursuant to— (1)any bonding assistance program authorized by law for an economically disadvantaged class of persons; (2)any bonding assistance program administered by a nonprofit organization for its members or an economically disadvantaged class of persons; or (3)any special purpose bonding program offered by a profit-making organization to meet special needs;

if such refusal is required by or made pursuant to such program.

(d)

Reasons for adverse action; procedure applicable; definition

(1)

Notice required

(A)

In general

Except as provided in subparagraph (B), any surety approved under section 9304 of title 31, United States Code, shall notify an applicant of the surety’s action on a completed application before the end of the 10-day period beginning on the date the application is filed with the surety. (B)

Extension

The 10-day period referred to in subparagraph (A) may be extended an additional 10 days if the surety has not issued a bond to the applicant during the 1-year period ending on the date the application is filed with the surety. (2)

Statement of reasons

(A)

In general

Each applicant against whom adverse action is taken shall be entitled to a statement of reasons for such action from the surety. (B)

Acceptable forms of statement

A surety satisfies the requirement established under subparagraph (A) by— (i)providing a statement of reasons in writing as a matter of course to applicants against whom adverse action is taken; or (ii)giving written notification of adverse action which discloses— (I)the applicant’s right to a statement of reasons within 30 days after receipt by the surety of a request made within 60 days after such notification; and (II)the identity of the person or office from which such statement may be obtained. (C)

Oral statement permitted

Such statement may be given orally if the written notification advises the applicant of the applicant’s right to have the statement of reasons confirmed in writing on written request. (3)

Specificity of reasons

A statement of reasons meets the requirements of this Act only if it contains specific reasons for the adverse action taken. (4)

Applicability in case of 3d party applications

In the case of a request to a surety by a third party to issue a bond directly or indirectly to an applicant, the notification and statement of reasons required by this section may be made directly by such surety, or indirectly through the third party, if the identity of the surety is disclosed to the applicant. (5)

Applicability in case of sureties which accept few applications

The requirements of paragraph (2), (3), or (4) may be satisfied by oral statements or notifications in the case of any surety who did not act on more than 100 applications during the calendar year in which the adverse action is taken. (e)

Adverse action defined

For purposes of this Act, the term adverse action— (1)means a denial of a bond, a change in the terms of an existing bonding arrangement, or a refusal to issue a bond in the amount or on substantially the terms requested; and (2)does not include any refusal to issue an additional bond under an existing bonding arrangement where the applicant is in default, or where such additional bond would exceed a previously established bonding limit.

Civil liability

(a)

Damages

Any surety who fails to comply with section 2(a) shall be liable to the aggrieved applicant for— (1)any actual damage sustained by such applicant (individually or as a member of a class); and (2)in the case of any successful action under this section, the costs of the action, together with reasonable attorney’s fees as determined by the court. (b)

Equitable relief

Upon application by an aggrieved applicant, a court of competent jurisdiction may enjoin a surety from violating the requirements of this Act or grant such other equitable relief as the court determines to be appropriate to enforce such requirements. (c)

Jurisdiction

Any action under this section may be brought in any United States district court, or in any other court of competent jurisdiction, within 1 year after the date of the occurrence of the violation involved.

Administrative enforcement

(a)

In general

A company may not be approved as a surety by the Secretary of the Treasury under section 9304 of title 31, United States Code, or provide any surety bond pursuant to such section unless such company maintains full compliance with the requirements of this Act. (b)

Requirements relating to enforceability of Act

(1)

Signed statement of compliance with application

Section 9305(a) of title 31, United States Code, is amended— (A)by striking and at the end of paragraph (1); (B)by striking the period at the end of paragraph (2) and inserting ; and; and (C)by adding at the end the following new paragraph:

(3)a statement of compliance with the &short-title1; which is signed under penalty of perjury by the president and the secretary of the corporation.

(2)

Compliance as a condition for approval of application

Section 9305(b) of title 31, United States Code, is amended— (A)by striking and at the end of paragraph (2); (B)by striking the period at the end of paragraph (3) and inserting ; and; and (C)by adding at the end the following new paragraph:

(4)the corporation is in full compliance with the &short-title1;.

(3)

Signed statement of compliance with quarterly reports

Section 9305(c) of title 31, United States Code, is amended by inserting and a statement of compliance with the &short-title1; before the period. (4)

Enforcement authority of Secretary of the Treasury

Section 9305(d) of title 31, United States Code, is amended— (A)in paragraph (1), by inserting or the provisions of the &short-title1; before the semicolon; (B)by striking and at the end of paragraph (2); (C)by striking the period at the end of paragraph (3) and inserting ; and; and (D)by adding at the end the following new paragraph:

(4)may, after the end of the 1-year period beginning on the effective date of any revocation under paragraph (1) of the authority of a surety corporation for noncompliance with the &short-title1;, reauthorize such corporation to provide surety bonds under section 9304.

(5)

Revocation for failure to pay certain judgments

Section 9305(e) of title 31, United States Code, is amended— (A)by striking and at the end of paragraph (1); (B)by redesignating paragraph (2) as paragraph (3); and (C)by inserting after paragraph (1) the following new paragraph:

(2)the corporation does not pay a final judgment or order against the corporation for noncompliance with the &short-title1; or fails to comply with any order under section 3(c) of such Act;

(c)

Technical and conforming amendment

Section 9304(a)(3) of title 31, United States Code, is amended by inserting and section 4(a) of the &short-title1; before the period. (d)

Regulations

(1)

In general

The Secretary of the Treasury shall prescribe such regulations as may be necessary to carry out the purposes of this Act. (2)

Initial regulations

The initial regulations prescribed pursuant to paragraph (1) shall take effect at the earliest practicable date after the date of the enactment of this Act and not later than the end of the 1-year period beginning on such date of enactment.

Effective date

Sections 2(d) and 4(a) shall take effect on the earlier of— (1)the effective date of the initial regulations prescribed pursuant to section 4(d); or (2)the end of the 1-year period beginning on the date of the enactment of this Act.