Section 1779. Construction and purchase contracts

Where the expense of the
  construction of the new hospital project or  any  part  thereof,  or  an
  addition,  betterment  or  extension  of  the facilities of the existing
  district hospital, or the purchase of materials, supplies and  equipment
  shall  involve  an expense exceeding two thousand dollars, the authority
  shall advertise for bids and shall award  the  contract  to  the  lowest
  responsible  bidder  fully  complying with the plans and specifications.
  The advertisement shall be published once, not less than two weeks prior
  to the date fixed for the opening of bids, in the official newspapers of
  the city of Salamanca. The authority may make rules and regulations  for
  the  submission of bids and award of contract thereon and may provide in
  such rules and regulations that no performance bond or undertaking  need
  be  furnished  by the contractor for the purchase of materials, supplies
  and equipment in an  amount  not  exceeding  one  thousand  dollars.  No
  contract in excess of one thousand dollars shall be entered into for the
  construction  of  a  project  or  a  part  thereof  or  for an addition,
  betterment, or extension to the  facilities,  or  for  the  purchase  of
  materials,  supplies  and  equipment unless the contractor shall give an
  undertaking, with a  sufficient  surety  or  sureties  approved  by  the
  authority  and  in  the  amount  fixed by the authority for the faithful
  performance of the contract. As to  a  contract  entered  into  for  the
  construction,  the  undertaking  shall provide, among other things, that
  the person or corporation entering in the  contract  will  pay  for  all
  materials  furnished  and  services  rendered  in the performance of the
  contract and that a person or corporation furnishing  the  materials  or
  rendering  the  services  may maintain an action to recover for the same
  against  the  obligor  in  the  undertaking  as  though  the  person  or
  corporation  were  named  therein, provided the action is brought within
  one year after the time the cause of action accrued.   Nothing  in  this
  section  shall  be  construed  to  limit  the  power of the authority to
  construct a project or a part thereof, or  an  addition,  betterment  of
  extension  to  the  facilities  directly  by  the  officers,  agents and
  employees of the authority.