When the board approves a contractor's application, what is the range of bond amounts that can be set?

The correct range of bond amounts that can be set when the board approves a contractor's application is between $1,000 and $500,000. This range is significant because it reflects the board's intention to ensure that contractors can handle their financial obligations and liabilities adequately. A bond serves as a form of security for the state and the public, as it protects clients against potential financial loss due to the contractor’s failure to perform according to the terms of the contract.

The lower boundary of $1,000 represents a minimal level of assurance for smaller projects or contractors with limited financial histories, while the upper limit of $500,000 accommodates larger projects and contractors who are capable of managing more substantial construction deals. This tiered bonding requirement is designed to promote credibility and responsibility within the contracting profession, aligning financial oversight with the size and scope of each contracting business.