(A) General provisions.
(1) When requested by the developer, in order to facilitate financing, the governing body or the planning agency, if designated, shall furnish the developer with a signed copy of a resolution indicating approval of the final plat contingent upon the developer obtaining a satisfactory financial security. The final plat or record plan shall not be signed nor recorded until the financial improvements agreement is executed. The resolution or letter of contingent approval shall expire and be deemed to be revoked if the financial security agreement is not executed within 90 days unless a written extension is granted by the governing body; such extension shall not be unreasonably withheld and shall be placed in writing at the request of the developer.
(2) Without limitation as to other types of financial security which the municipality may approve, which approval shall not be unreasonably withheld, federal or commonwealth chartered lending institution irrevocable letters of credit and restrictive or escrow accounts in such lending institutions shall be deemed acceptable financial security for the purposes of this section.
(3) Such financial security shall be posted with a bonding company or federal or commonwealth chartered lending institution chosen by the part posting the financial security, provided that said bonding company or lending institution is authorized to conduct such business within the commonwealth.
(4) Such bond or other security shall provide for and secure to the public the completion of any improvements which may be required on or before the date fixed in the formal action or approval or accompanying agreement for completion of the improvements.
(5) The amount of financial security to be posted for the completion of the required improvements shall be equal to 110% of the cost of completion estimated as of 90 days following the date scheduled for completion by the developer. Annually, the municipality may adjust the amount of the financial security by comparing the actual cost of the improvements which have been completed and the estimated cost for the completion of the remaining improvements as of the expiration of the ninetieth day after either the original date scheduled for completion or a rescheduled date of completion. Subsequent to said adjustment, the municipality may require the developer to post additional security in order to assure that the financial security equals said 110%. Any additional security shall be posted by the developer in accordance with this division (A)(5).
(6) The amount of financial security required shall be based upon an estimate of the cost of completion of the required improvements, in accordance with applicable prevailing wage rates for the state, submitted by an applicant or developer and prepared by a professional engineer licensed as such in this commonwealth and certified by such engineer to be a fair and reasonable estimate of such cost. The cost estimate shall separate the costs of all improvements to be dedicated to the township (for GASB 34 compliance) from those improvements not to be dedicated. The municipality, upon the recommendation of the Municipal Engineer, may refuse to accept such estimate for good cause shown. If the applicant or developer and the municipality are unable to agree upon an estimate, then the estimate shall be recalculated and recertified by another professional engineer licensed as such in this commonwealth and chosen mutually by the municipality and the applicant or developer. The estimate certified by the third engineer shall be presumed fair and reasonable and shall be the final estimate. In the event that a third engineer is so chosen, fees for the services of said engineer shall be paid equally by the municipality and the applicant or developer.
(7) If the party posting the financial security requires more than one year from the date of posting of the financial security to complete the required improvements, the amount of financial security may be increased by an additional 10% for each one-year period beyond the first anniversary date from posting of financial security or to an amount not exceeding 110% of the cost of completing the required improvements as reestablished on or about the expiration of the preceding one-year period by using the above bidding procedure.
(8) In the case where development is projected over a period of years, the governing body or the planning agency may authorize submission of final plats by section or stages of development subject to such requirements or guaranties as to improvements in future sections or stages of development as it finds essential for the protection of any finally approved section of the development.
(9) As the work of installing the required improvements proceeds, the party posting the financial security may request the governing body to release, or authorize the release of, from time to time, such portions of the financial security necessary for payment to the contractor or contractors performing the work. Any such requests shall be in writing addressed to the governing body, and the governing body shall have 45 days from receipt of such request within which to allow the Municipal Engineer to certify, in writing, to the governing body that such portion of the work upon the improvements has been completed in accordance with the approved plat. Upon such certification, the governing body shall authorize release by the bonding company or lending institution of an amount as estimated by the Municipal Engineer fairly representing the value of the improvements completed or, if the governing body fails to act within said 45-day period, the governing body shall be deemed to have approved the release of funds as requested. The governing body may, prior to final release at the time of completion and certification by its Engineer, require retention of 10% of the estimated cost of the aforesaid improvements.
(10) Where the governing body accepts dedication of all or some of the required improvements following completion, the governing body may require the posting of financial security to secure structural integrity of said improvements as well as the functioning of said improvements in accordance with the design and specifications as depicted on the final plat for a term not to exceed 18 months from the date of acceptance of dedication. Said financial security shall be of the same type as otherwise required in this section with regard to installation of such improvements, and the amount of the financial security shall not exceed 15% of the actual cost of installation of said improvements.
(11) If water mains or sanitary sewer lines, or both, along with apparatus or facilities related thereto, are to be installed under the jurisdiction and pursuant to the rules and regulations of a public utility or municipal authority separate and distinct from the municipality, financial security to assure proper completion and maintenance thereof shall be posted in accordance with the regulations of the controlling public utility or municipal authority and shall not be included within the financial security as otherwise required by this section.
(12) If financial security has been provided in lieu of the completion of improvements required as a condition for the final approval of a plat as set forth in this chapter, the municipality shall not condition the issuance of building, grading or other permits relating to the erection or placement of improvements, including buildings, upon the lots or land as depicted upon the final plat upon actual completion of the improvements depicted upon the approved final plat. Moreover, if said financial security has been provided, occupancy permits for any building or buildings to be erected shall not be withheld following the improvement of the streets providing access to and from existing public roads to such building or buildings to a mud-free or otherwise permanently passable condition, as well as the completion of all other improvements as depicted upon the approved plat, either upon the lot or lots or beyond the lot or lots in question if such improvements are necessary for the reasonable use of or occupancy of the building or buildings. Any ordinance or statute inconsistent herewith is hereby expressly repealed.
(B) Release from improvement bond.
(1) When the developer has completed all of the necessary and appropriate improvements, the developer shall notify the municipal governing body, in writing, by certified or registered mail, of the completion of the aforesaid improvements and shall send a copy thereof to the Municipal Engineer. The applicant’s engineer shall certify that all completed work complies with the approved plans. The municipal governing body shall, within ten days after receipt of such notice, direct and authorize the Municipal Engineer to inspect all of the aforesaid improvements. The Municipal Engineer shall, thereupon, file a report, in writing, with the municipal governing body and shall promptly mail a copy of the same to the developer by certified or registered mail. The report shall be made and mailed within 30 days after receipt by the Municipal Engineer of the aforesaid authorization from the governing body; said report shall be detailed and shall indicate acceptance or rejection of said improvements, either in whole or in part, and if said improvements, or any portion thereof, shall not be accepted or shall be rejected by the Municipal Engineer, said report shall contain a statement of reasons for such non-approval or rejection.
(2) The municipal governing body shall notify the developer within 15 days of receipt of the Engineer’s report, in writing, by certified or registered mail, of the action of said municipal governing body with relation thereto.
(3) If the municipal governing body or the Municipal Engineer fails to comply with the time limitation provisions contained herein, all improvements will be deemed to have been accepted and the developer shall be released from all liability except that required under division (A)(10) above, pursuant to its performance guaranty bond or other security agreement.
(4) If any portion of said improvements shall not be accepted or shall be rejected by the municipal governing body, the developer shall proceed to complete the same and, upon completion, the same procedure of notification, as outlined herein, shall be followed.
(5) Nothing herein, however, shall be construed in limitation of the developer’s right to contest or question, by legal proceedings or otherwise, any determination of the municipal governing body or the Municipal Engineer.
(6) Where herein reference is made to the Municipal Engineer, he or she shall be a duly registered professional engineer employed by the municipality or engaged as a consultant thereto.
(7) The applicant shall reimburse the municipality for the reasonable and necessary expense incurred for the inspection of improvements, including resident inspection for those improvements as determined by the township. Such reimbursement shall be based upon a schedule established by ordinance or resolution. Such expense shall be reasonable and in accordance with the ordinary and customary fees charged by the Municipal Engineer or consultant for work performed for similar services in the community, but in no event shall the fees exceed the rate or cost charged by the Engineer or consultant to the municipalities when fees are not reimbursed or otherwise imposed on applications.
(a) In the event that the applicant disputes the amount of any such expense in connection with the inspection of improvements, the applicant shall, within 30 working days of the date of billing, give written notice to the municipality that such expenses are disputed as unreasonable or unnecessary and shall explain the basis of their objection to the fees charged, in which case the municipality shall not delay or disapprove a subdivision or land development application or any approval or permit related to development due to the applicant’s request over disputed engineer expense. Failure of the applicant to dispute a bill in writing within 30 days shall be a waiver of the applicant’s right to arbitration of that bill under this section.
(b) If, within 20 days from the date of billing, the municipality and the applicant cannot agree on the amount of expenses which are reasonable and necessary, then the applicant and municipality shall jointly, by mutual agreement, appoint another professional engineer licensed as such in the commonwealth to review said expenses and make a determination as to the amount thereof which is reasonable and necessary.
(c) The professional engineer so appointed shall hear such evidence and review such documentation as the professional engineer in his or her sole opinion deems necessary and render a decision within 50 days of the billing date. The applicant shall be required to pay the entire amount determined in the decision immediately.
(d) In the event that the municipality and applicant cannot agree upon the professional engineer to be appointed within 20 days of the billing date, then, upon application of either party, the President Judge of the Court of Common Pleas of the judicial district in which the municipality is located (or if at the time there is no President Judge, then the senior active Judge then sitting) shall appoint such engineer, who, in that case, shall be neither the Municipal Engineer nor any professional engineer who has been retained by, or performed services for, the municipality or the applicant within the preceding five years.
(e) The fee of the appointed professional engineer, for determining the reasonable and necessary expenses, shall be paid by the applicant if the amount of payment required in the decision is equal to or greater than the original bill. If the amount of payment required in the decision is less than the original bill by $1,000 or more, the municipality shall pay the fee of the professional engineer, but otherwise the municipality and the applicant shall each pay one-half of the fee of the appointed professional engineer.
(C) Remedies to effect completion improvements. In the event that any improvements which may be required have not been installed as provided in this chapter or in accord with the approved final plat, the governing body of the municipality is hereby granted the power to enforce any corporate bond or other security by appropriate legal and equitable remedies. If proceeds of such bond or other security are insufficient to pay the cost of installing or making repairs or corrections to all the improvements covered by said security, the governing body of the municipality may, at its option, install part of such improvements in all or part of the subdivision or land development and may institute appropriate legal or equitable action to recover the moneys necessary to complete the remainder of the improvements. All of the proceeds, whether resulting from the security or from any legal or equitable action brought against the developer, or both, shall be used solely for the installation of the improvements covered by such security and not for any other municipal purpose.
(Ord. 2-2011, passed 10-6-2011)