IN state timber sale bonds.
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What the state timber sale bond actually guarantees

Indiana’s state forests are working forests, and the DNR Division of Forestry sells standing timber off them by competitive bid. The bond is what lets you play. Under the Division’s online timber sale system a bidder must have a surety bond or an irrevocable line of credit on file before bidding; when you submit a bid the system holds five percent of that bid against your bond as a performance deposit. Lose the sale and the deposit goes straight back into your available bond for the next bid. Win it, and the amount stays held until the contract is complete, at which point it is released back into your total bond — nothing is refunded because nothing was ever paid over.

The bond itself, State Form 56877, is short and unusually clear about what it covers. The principal is bound to the State of Indiana in the penal sum written on the face, on the condition that the principal will enter into one or more timber sale agreements with the Indiana DNR for the purchase of timber from state-owned lands for the cutting and removal of stumpage; that those contracts are entered into during the existence of this bond; and that if the principal faithfully carries out and observes all obligations assumed in each timber contract and observes all the rules, regulations, and applicable laws of the DNR, the obligation is void — otherwise it remains in full force and effect without limit in time until the bond is duly canceled. A surety can only walk away on 120 days notice to the Division, and even then cancellation does not touch liability already incurred.

This is not the timber buyer licence bond, and one will not substitute for the other. Registration as an Indiana timber buyer requires its own bond filed with the Department under IC 25-36.5-1-3 and 312 IAC 14-3-2 — a separate instrument that starts at a principal amount of $5,000 for annual purchases of $10,000 or less, adds $100 for each additional $1,000 of purchases, and is capped at $50,000; it may be posted as a surety bond, as cash deposited with the Division of Forestry, or as an assigned certificate of deposit. The state timber sale bond sits on top of that licence and secures your contracts with the state. You need the licence active — the bidding system checks it — and you need this bond sized for the sales you intend to chase.

You need this bond if you are