6- the bid provided about two and one-half million dollars of financing without cost. If it were not for the privilege of filing a tax return on a completed-job basis, the joint venture would have showed $1,000,000 in taxes at the end of the first two years. As it was, no taxes were payable until the end of the fifth year. Eliminating the effect of unbalancing the bid and the rate changes, the project gained the use of some $36,000 yearly from unpaid taxes for each of the first four years of the job, eliminating the need to raise $144,000 of capital from other sources. Had this job been just a two-year job, the ability to postpone the payment of taxes to the completion of the job would have made over $800,000 available from the first year to finance the second year's operations. This means of raising money by postponing the payment of taxes is not as good as it looks. Sooner or later the contractor must pay the taxes that he owes. Actual experience has sometimes shown that the contractor postponed the payment of taxes at a 38% rate only to find that he ultimately had to pay a tax on an 82% rate. In our own company we select the completed-job basis only when we have bid the job on an unbalanced bid basis. We would also select a completed-job basis if we were convinced that taxes were going down, but so far this is a happy prospect that has not been faced in our lifetime. Of course, the use of subcontractors can often assist the general contractor financially by reducing the risk and by passing on to the subcontractor a disproportionate share of the financial load. Where bonded subcontractors are available, this plan will Work. However, more often than not, the subcontractor is weak financially and the general contractor is the provider of financing rather than the recipient. Another indirect financing tool is the performance bond, which often is required before the owner will award the work. It is the owner's protection that the contract will be fulfilled, regardless of the financial capability of the contractor. In effect, the owner forces the contractor to buy credit insurance from the bonding company. The bonding company in effect is a co-signer of the contract. Before it will do so, it must be convinced that the contractor will perform. It bets on the contractor's brains as well as his balance sheet.