The form is the requirement
A surety bond is a three-party guarantee, and normally the surety decides what paper it issues on. Public agencies often override that, and San Diego is one of them. For grading permits, public right-of-way permits, and maps, the City requires its own bond form, DS-401, and states that it does not accept insurance company letters or other insurance company documents in place of it.
The requirements are published by the Development Services Department in Information Bulletin 126, “Bonding for Grading/Public Right-of-Way Permits and Maps”. That bulletin is the authority and it is revised periodically, so check it for the current amounts, release process, and which security a given permit calls for rather than relying on what a contractor told you last year.
What this is not
This trips people up, so it is worth stating plainly. Information Bulletin 126 is about permit and development security: the bond that stands behind grading, public improvements in the right-of-way, and the survey and infrastructure work tied to a map. It is not the rule for a performance bond on a City construction contract.
If you are the apparent low bidder on a City of San Diego construction contract, you post an ordinary contract performance bond, alongside a payment bond, on whatever form that contract specifies. Same city, different requirement, different moment in the job. Bring the wrong one and you lose a week.
Why the bond comes back
Sureties issue thousands of bonds a month on their own standard forms. Unless someone tells the underwriter that this one is for San Diego Development Services Department, the bond arrives on the surety's paper, the counter rejects it, and the permit waits while a corrected bond is executed and re-sealed. Nothing about the underwriting changes. The week is lost entirely to paperwork.
The fix is unglamorous: say so up front. Name the agency, name the permit or map, and give your broker the approved cost estimate the amount is based on. A bond issued correctly the first time is the whole game here.
How the amount gets set
For this kind of security the amount is not something you or your surety choose. It comes from the agency's approved estimate of the work, which is why the estimate should be settled before the bond is ordered. We cover the mechanics of that, and the part most developers underestimate — getting the security released once the work is accepted — in California subdivision improvement bonds. The same logic drives permit bonds generally.
Note that under the Subdivision Map Act (Gov. Code §66410 et seq.), a subdivider may secure improvements with a bond, a cash deposit, or an instrument of credit. Which of those San Diego will take for your specific permit, and on what terms, is a question for Information Bulletin 126 and the plan reviewer, not for a general article.
Bonding San Diego work generally
Development Services is one counter among several. Contractors chasing public work in the region also deal with the County, the Port, SANDAG, and the school districts, each with its own bidding process and its own bond forms. Our San Diego surety bond page lists the purchasing pages for each, and how to bid public works in California walks the sequence from bid bond to final release.
If your file is the complicated part rather than the form — new entity, thin financials, a prior claim — that is placeable too. See hard-to-place surety bonds, or send us the permit and we will tell you what the City will want.