# Michigan — State public works payment and performance bond thresholds (Little Miller Acts)

For Michigan, performance bond threshold is Any contract exceeding $50,000 for the construction, alteration, or repair of any public building or public work or improvement; payment bond threshold is Any contract exceeding $50,000 for the construction, alteration, or repair of any public building or public work or improvement; bond amount is Each payment and performance bond shall be in an amount fixed by the government unit to be not less than 25 percent of the contract price; preliminary notice required is claimant has within 30 days after furnishing the first of such material or performing the first of such labor served on the principal contractor a written notice; statutory citation is Michigan Compiled Laws, Chapter 129, §129.201, verified against its source on 2026-08-17.

- **State:** Michigan _(our reading, not quoted from the source)_
- **Performance bond threshold:** Any contract exceeding $50,000 for the construction, alteration, or repair of any public building or public work or improvement _(verified: appears in the quote below)_
- **Payment bond threshold:** Any contract exceeding $50,000 for the construction, alteration, or repair of any public building or public work or improvement _(verified: appears in the quote below)_
- **Bond amount:** Each payment and performance bond shall be in an amount fixed by the government unit to be not less than 25 percent of the contract price _(verified: appears in the quote below)_
- **Preliminary notice required:** claimant has within 30 days after furnishing the first of such material or performing the first of such labor served on the principal contractor a written notice _(verified: appears in the quote below)_
- **Statutory citation:** Michigan Compiled Laws, Chapter 129, §129.201 _(verified: appears in the quote below)_

## What the source says

> MICHIGAN BONDS REQUIRED/TWO STATUTES DEPENDING ON TYPE OF PROJECTS State (Non-Highway) and Municipal Projects: Any contract exceeding $50,000 for the construction, alteration, or repair of any public building or public work or improvement of the state or a county, city, village, township, school district, public educational institution, other political subdivision, public authority, or public agency shall require that the principal contractor furnish at his or her own cost to the governmental unit a performance bond and a payment bond. If the principal contractor is a common carrier or the designated operator of a state subsidized railroad, the principal contractor may provide an irrevocable letter of credit from a state or national bank or a state or federally chartered savings and loan association instead of the bonds. Each payment and performance bond shall be in an amount fixed by the government unit to be not less than 25 percent of the contract price. State Highway Projects (Michigan Department of Transportation): State highway jobs under the Michigan Department of Transportation (MDOT) are covered by a separate statute, (MCL §570.101 et seq .). General contractors are required to file a payment bond for the protection of subcontractors and suppliers. Labor and Material Covered: Labor, material, or both used or reasonably required for use in the performance of the contract, including that part of water, gas, power, light, heat, oil, gasoline, telephone service or rental of equipment directly applicable to the contract. A separate statute (MCL §570.101 et seq .) covers state highway projects. Notice Required (State (Non-Highway) and Municipal Projects): No notice is required by a claimant having a contractual relationship with the principal contractor. A claimant not having a direct contractual relationship with the principal contractor does not have a right of action upon the payment bond unless: (a) claimant has within 30 days after furnishing the first of such material or performing the first of such labor served on the principal contractor a written notice which shall inform the principal of the nature of the materials being furnished or to be furnished or labor being performed or to be performed and identifying the party contracting for such labor or material and the site for the performance of such work or the delivery of such materials; and (b) claimant has given written notice to the contractor and the governmental unit involved within 90 days from the date on which the claimant performed the last of the labor or furnished or supplied the last of the material for which the claim was made, stating with substantial accuracy the amount claimed and the name of the party to whom the material was furnished or supplied or for whom the labor was done or performed. Each notice shall be served by mailing the same by certified mail, postage prepaid, in an envelope addressed to the principal contractor, the governmental unit involved, at any place at which said parties maintain a business or residence. Notice Required (State Highway Projects): Notice of Lien Claim must be filed by subcontractor or material supplier to MDOT as notice of an intent to file a claim against the bond. Even though the claim is against the bond and not real property, the notice is referred to as a Notice of Lien Claim. A form is available on MDOT’s website. Subcontractors must provide the required notice within 60 days after furnishing the last material or supplies or performing the last work covered by their subcontract. However, this period has been modified by MDOT endorsement. A copy of the bond and notice requirements should be requested early in the project to ensure compliance. In the notice, the claimant must specify the work provided, that it relies upon the security of the bond given by the general contractor and directs the MDOT to notify the surety on the bond. Note: Always review the actual bond as notice requirements can be lessened or waived. Notice requirements cannot, however be increased beyond the statutory requirements. Relevant Statutes. Michigan’s Public Act 524 of 1980 (Retainage Act): Contract retainage funds must be segregated and interest must be paid on the retainage when final payment on project is released. The Retainage Act restricts the public owner’s ability to withhold retainage to 10 percent of the first 50 percent of the work in place. Michigan’s Differing Site Conditions statute applies to all public works projects over $75,000. The Act provides for a negotiating process for contractors who encounter unusual or misrepresented conditions while performing public works projects. Statutory Citation: Michigan Compiled Laws, Chapter 129, §129.201 et seq .; Chapter 570, §570.101 et seq .

## Source

- https://fullertonlaw.com/50-state-summary-payment-bond-law

Last verified: 2026-08-17. Review by: 2027-08-17.
Part of [State public works payment and performance bond thresholds (Little Miller Acts)](https://referencesource.org/state-public-works-bond-thresholds/).