Bonding Capacity Calculator | Full Send Funding

You need to enable JavaScript to run this app.Bonding Capacity CalculatorA surety sizes your program off working capital, not revenue — and off its own adjusted version of your balance sheet, not the one your accountant prepared. Enter the lines below and see the adjusted figure, the single-job and aggregate limits it supports, and what the current portion of your debt is costing you in bidding room.Free to use, with no sign-up and no email address. The figures you enter stay in your browser — they are not sent anywhere and they are not stored.How this is calculatedFrom working capital to capacity

Surety-adjusted working capital is the sum of each current asset times the percentage the surety counts it at, less current liabilities in full — including the current portion of long-term debt, which is counted at 100%.

Single-job capacity is the adjusted figure times the single-job multiple; aggregate program capacity is the adjusted figure times the aggregate multiple. The defaults are 10x and 20x, which are the common starting points rather than anyone’s published schedule.

The adjustment is stated as a percentage below the book figure, because that is the number to sanity-check: the adjusted result commonly lands 20% to 40% below book, and a result far outside that band usually means a line has been entered in the wrong row.

The cost of current debt is the current portion of long-term debt times each multiple — the bidding room that debt removes, which is the point the article makes and the reason a facility structured as a twelve-month payback is expensive in capacity even when it is cheap in interest.

The value of subordinating an owner loan is that balance times each multiple, because a subordination agreement reclassifies it out of current liabilities for the surety’s calculation.

What a surety does to each line before it counts it

Cash — counted in full — immediately available. Default 100%.

Receivables under 90 days — counted, sometimes with a concentration cap — collectible on a normal cycle. Default 100%.

Receivables over 90 days — discounted or excluded — age signals dispute or collection risk. Default 0%.

Retainage receivable — often counted only where currently collectible — retainage on a job at 20% completion is not near-term cash. Default 0%; raise it to the share that is actually releasable.

Underbillings (costs in excess of billings) — frequently discounted — revenue recognized but not yet billable. Default 0%.

Related-party receivables — usually excluded — not arm’s length. Default 0%.

Inventory and prepaid expenses — discounted or excluded — not readily convertible to cash. Default 0%.

Current portion of long-term debt — counted in full as a current liability — it reduces working capital dollar for dollar, and capacity at the multiple.

The two levers this calculator can price

Subordinating an owner loan. If the company owes its owner money and that balance sits in current liabilities, a subordination agreement moves it out of the surety’s calculation. Enter the balance and the tool prices the capacity it returns.

Restructuring the current portion of long-term debt. A dollar scheduled for repayment in the next twelve months costs ten or twenty dollars of bidding room. Lengthening a facility does not make the debt cheaper; it makes the capacity cheaper.

What this cannot tell you

It cannot tell you your own multiples. They vary by surety, by contractor history and by type of work; 10x and 20x are the common starting points, and your agent knows yours.

It cannot read your work-in-progress schedule. A surety reads the WIP for fade — the decline in a job’s gross margin from bid to completion — and a pattern of fading jobs is a finding no balance-sheet repair lifts.

It is not a bonding decision. Character, experience and the indemnity behind the company decide as much as the arithmetic does.

Terms used here

Surety bond — A three-party instrument in which the surety guarantees to the project owner that the contractor will perform or pay, and the contractor indemnifies the surety for anything it pays out. Insurance for the customer, bought and personally guaranteed by the contractor.

Surety-adjusted working capital — Current assets less current liabilities after the surety’s adjustments: long-dated retainage, aged receivables, related-party balances and other slow assets discounted or excluded. The figure that sizes bonding capacity, and typically 20% to 40% below the balance-sheet figure.

Current portion of long-term debt — The principal on any facility scheduled for repayment within twelve months, classified as a current liability. It reduces working capital dollar for dollar, and capacity at the multiple.

Subordination agreement — An agreement, usually by an owner who has lent to the company, not to be repaid ahead of the surety’s interest, which reclassifies that debt out of current liabilities for the surety’s calculation.

Fade — The decline in a job’s gross margin from bid to completion. One fading job is ordinary; a pattern across jobs is read as a finding about estimating or execution — a character-and-capacity issue that no balance-sheet repair lifts.