READFIELD — A new plowing contract will save the town money and provide insurance in case something goes wrong with the contractor, town officials said.

Readfield’s Board of Selectmen voted Monday to end the town’s contract with Horne Construction of Mount Vernon because the company could not secure a bond or letter of credit, which ensures that a town can hire a replacement contractor at mid-season if necessary.

“Scott Horne had done a good job of plowing last winter, and we were really happy with his service, but he is a very small company,” Selectman Andrews Tolman said Tuesday. “And if something happened to him, there was pretty much no backup. Without a bond, the town had the potential of the liability of having paid for services he couldn’t deliver anymore.”

The selectmen unanimously awarded a new contract to McGee Construction of West Gardiner. The contract is $744,240 for three years, with an option for a fourth year.

Horne won Readfield’s plowing business last fall after residents voted to abolish the town’s Public Works Department. When Horne was unable to obtain a bond, the selectmen amended the contract in January and gave him a deadline of Aug. 1 to do so.

Town Manager Stefan Pakulski said Readfield has a history of requiring a bond worth 50 percent to 80 percent of the contract’s value.

“A lot of towns don’t do it because it’s so difficult for plow contractors to get it, and it’s a way to reduce the cost of the contract,” Pakulski said. “In places where you don’t have a lot of competition, it can be a real issue.”

Unable to secure a bond or letter of credit, Horne offered Readfield a $10,000 reduction on the contract, deferred payment, ownership of the salt and sand the company would purchase and all the company’s equipment as collateral. The equipment was appraised at slightly less than $150,000.

Last month, the selectmen solicited new bids to see what other options might exist.

The town received proposals from Nitram Excavation & General Contractors of Benton and McGee, with McGee being the low bidder. Two Readfield companies that bid last year, but Reay Excavation & Trucking is not seeking town work while co-owner Sue Reay is a selectwoman, and Cushing Construction did not bid.

McGee’s bid came in at $15,792 less than Horne’s contract for the next three years, and the company provided a letter from a bonding firm.

Readfield’s Road Committee also recommended awarding the contract to McGee because in the case of a contractor terminating or defaulting, it would be simpler and faster to recover funds through a bond or letter of credit than by selling equipment held in collateral.

McGee provides plowing for several towns, and Tolman said the company performed well in building a sidewalk through Readfield this summer.

Susan McMillan — 621-5645

smcmillan@mainetoday.com