2. The Chico Process as a Bond Reporting Model

3. The Data Flow – Full Chico Process Recapping the Chico Process The Data Flow – Chico Process as a Bond Report The Programming Model for Reporting Bonds Summary Overview

4. The Data Flow – Full Chico Process Recapping the Chico Process The Data Flow – Chico Process as a Bond Report Summary Overview The Programming Model for Reporting Bonds

5. The surety industry is facing the difficult challenge of working towards an industry solution for delivery of surety bonds, with an industry that is so massive any coordinated change in delivery, such as from paper documents to electronic, that consensus and collective action is almost impossible to reach.

6. All changes to operational systems must be able to contemplate the overall long term consequences, not just the short term objectives.

7. The surety industry is facing the difficult challenge of working towards an industry solution for delivery of surety bonds, with an industry that is so massive any coordinated change in delivery, such as from paper documents to electronic, that consensus and collective action is almost impossible to reach. All changes to operational systems must be able to contemplate the overall long term consequences, not just the short term objectives. In the ever changing technological capabilities the long term is impossible to quantify, making solutions hard to commit to.

8. By removing the commitment required for finding a long term solution CSU Chico is offering the surety industry, and those public agencies that rely on surety products, the ability to participate as observers on a series of steps that culminate in an industry wide solution.

9. The first step is the relatively simple contractors license bond

10. By removing the commitment required for finding a long term solution CSU Chico is offering the surety industry, and those public agencies that rely on surety products, the ability to participate as observers on a series of steps that culminate in an industry wide solution. The first step is the relatively simple contractors license bond The foundation of which can be used for all bonds of all complexities.

11. The Data Flow – Full Chico Process Recapping the Chico Process The Data Flow – Chico Process as a Bond Report Summary Overview The Programming Model for Reporting Bonds

12. The Chico Process is a methodology that calls for one central location for all public agencies, to verify a surety bond regardless of which surety, or in which state, the surety bond was written.

13. Which in turn provides for the surety industry to have only one place to maintain their respective verification web location information.

14. And provides for the use of appointed designees for those surety companies that choose to outsource to verification processing vendors.

15. Start:aecXML Highway 1 Tunnel 04-12345 082501 Caltrans 10000000 365 1000 04-12345BB www.caltrans.gov/projects/04-12345 www.caltrans.gov/projects/04- 12345/bidbond End:aecXML So that all data flows along a uniform path, and uses the acord XML standard for the greatest efficiency possible.

16. Based on the common practice of email along a secure pipeline.

17. Power of AttorneyNotaryBond Form And the constraints of the paper based system, and its power of attorney and jurat's are discontinued as unnecessary.

18. So that all parties have the bond record, as well as a secure copy stored in case it is ever needed in the future.

19. Third Party Verifier And the precedence of multiple Obligee based proprietary verification models is stopped, and ultimately replaced with surety based open standards verification models.

20. The Data Flow – Full Chico Process Recapping the Chico Process The Data Flow – Chico Process as a Bond Report Summary Overview The Programming Model for Reporting Bonds

21. The full Chico Process takes into account the life cycle of bid bond because it represents the most complex challenge. If that process can achieved then simplification is easier.

22. The Full Flow

23. The Data Flow – Full Chico Process Recapping the Chico Process The Data Flow – Chico Process as a Bond Report Summary Overview The Programming Model for Reporting Bonds

24. In the simplified model depicting the flow of data for a contractors license bond the demonstration included a process where the contractor or their broker entered data into the surety company data capture screen.

25. So the Full Flow

26. Can be reduced to just a data report of the bonds issued from the surety company to the contractors license board.

27. The Data Flow – Full Chico Process Recapping the Chico Process The Data Flow – Chico Process as a Bond Report Summary Overview The Programming Model for Reporting Bonds

28. The programming model for reporting bonds differs from a verification model in that the owner does not request a verification for a particular bond, but sends an inquiry for a download of all newly issued bonds for their respective agency.

29. Public agencies that are prepared to receive an inquiry simply register with

30. The first application is a send and receive application that starts the process by sending an inquiry to participating surety companies if any bonds have been issued and not reported.

31. An inquiry goes out for unreported California CLB bonds

32. The next application is a dummy database of contractors license bonds to represent insurance company records.

33. The next application is a database that performs an inquiry to the company database after the inquiry is received and extracts a record of all California CLB bonds issued that have not yet been reported.

34. The application aggregates all the bonds that need to be reported, and prepares batch files per public agency that is prepared to receive resulting the transmission.

35. The send and receive application receives the batch files.

36. Or receives the batch files.

37. And distributes the batch files to the respective public agencies. ASCI

38. Each batch files arrives with the acord XML standard data set into an application that converts the data to a structure that meets the needs of the particular public agency.

39. The Data Flow – Full Chico Process Recapping the Chico Process The Data Flow – Chico Process as a Bond Report Summary Overview The Programming Model for Reporting Bonds

40. The Chico Process follows a data flow model the preserves the role of each of the parties

41. ASCI While promoting the use of the surety industry adopted acord XML standard to demonstrate to public agencies a positive and concrete strategy as a surety industry solution to the public agency's requirement for electronic transactions, versus an Obligee driven solution.

42. In the interest of providing its students with the highest level of educational experience and career opportunities, CSU Chico and its students have committed its resources and talents to taking on the challenge of creating the prototype applications that confront the obstacles of a varied and fragmented business community and deliver uniformity and efficiency.

43. Thank you