OSA Weekly Update - 8/8/2025
1. Message from Auditor Blaha
2. Meeting: Fire Relief Association Working Group
3. Revised: Tax Increment Financing (TIF) Statement of Position Available
4. Avoiding Pitfall: Contractors' Performance and Payment Bonds
1. Message from Auditor Blaha
Farmfest in Redwood County has been a highlight of my summers at the OSA, and this year was no different. It was great to connect with farmers and agricultural policy leaders to hear their ideas first-hand. In my role as State Auditor, I serve on the board of the Minnesota Department of Agriculture’s Rural Finance Authority (RFA). The RFA offers low-interest loan programs to farmers for a wide variety of activities through partnerships with local lenders. To learn more and spread the word about these programs to your local farmers, visit the RFA’s webpage.
2. Meeting: Fire Relief Association Working Group
The State Auditor’s Fire Relief Association Working Group will be meeting on August 12, from 2 – 3:30 p.m., with options to attend in-person at our office in Saint Paul or remotely via Teams. Meetings also will be livestreamed with recordings and meeting materials available on the OSA website. Topics on the meeting agenda include a discussion of audit thresholds and requirements, and a discussion of when membership in a relief association starts.
3. Revised: Tax Increment Financing (TIF) Statement of Position Available
The 2025 Legislature amended the TIF Act provision enacted during the pandemic that allowed temporary transfers of unobligated increment. Changes included an extension of the deadline for commencement of construction, clarification of amounts that may need to be returned, and allowing spending plans to be amended to extend the deadline for use of transferred increments and authorize the use of interest earned on transferred funds. The Temporary Transfer Authority (2021 Law) statement of position has been updated on our website to reflect these changes.
4. Avoiding Pitfall: Contractors' Performance and Payment Bonds
When public entities enter into contracts greater than $175,000, they must obtain a performance bond and a payment bond from the contractor. This requirement, with a few exceptions, applies to contracts for “the doing of any public work.”
The performance bond helps ensure that the work will be completed according to the terms of the contract. The payment bond helps ensure that subcontractors, and people who provide labor and materials, are paid.
The bonds must be equal to or greater than the contract price. If the contract price increases after the bonds are provided, the public entity should consider obtaining additional bonds.
The statutes requiring these bonds are contained in the Public Contractors’ Performance and Payment Bond Act found in Minnesota Statutes sections 574.26 to 574.32. For additional information on contractors’ bonds, see our Statement of Position Contract Change-Orders and Contractor’s Bonds.
The full Avoiding Pitfall is available on the OSA website.
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