(A) Prior to the issuance of any permit for any work on a condominium project, the developer shall obtain and submit a performance guarantee for the construction and installation of all public or private improvements, and the estimated amount of total deposits that the developer plans to take for each condominium unit in a condominium project to the Building Commissioner for approval and acceptance in accordance with this section.
(B) The developer shall submit a guarantee for the following improvements, as deemed necessary by the Building Commissioner:
(1) Permanent subdivision monuments and lot corner markers;
(2) Transportation system improvements, including:
(a) Public and private streets, and all related frontage and intersection improvements;
(b) Street lights;
(c) Parkway tree plantings;
(d) Street signs, signals and apparatus;
(e) Public and private sidewalks, trails and bike paths;
(f) Other traffic-related improvements contemplated as part of the subdivision or development;
(g) Environmental protection and site preparation measures, including:
1. Grading and related site preparation work;
2. Erosion and sediment controls during the various phases of site development (including site and lot grading, construction entrances, diversion dikes, silt fences, sediment traps, seeding and site stabilization); and
3. Other special environmental protection measures which are a component of the final engineering plans;
(h) Public utility systems, including:
1. Public and private storm sewer system (pipes, inlets, manholes, swales, detention ponds, and all related structures and apparatus);
2. Public water system (pipes, valves, fire hydrants and related system improvements); and
3. Sanitary sewer system (pipes, manholes, lift stations and related system improvements);
(i) Common facilities which are contemplated as part of the condominium project specified in the final engineering plans; and
(j) Other public and private improvements specified in the final engineering plans.
(C) The developer shall submit to the Building Commissioner estimates for the cost of construction (or actual executed construction contracts) for public and private improvements contemplated in the final engineering plan, as well as the total estimated amount of deposits that the developer intends to take from the contract purchasers of all condominium unit in the condominium project. The total estimated deposits shall be based upon the required deposit amount the developer establishes in the disclosure declaration, pursuant to § 158.03(C)(8)(g). The Building Commissioner shall review such estimates or construction contracts and, if acceptable, approve the amount of the performance guarantee. The amount of the performance guarantee shall be based upon:
(1) One hundred twenty-five percent of the total estimate of construction costs, deposits, and inspection fees for all guaranteed improvements; or
(2) One hundred ten percent of the total construction costs as indicated in an approved and executed construction contract, plus estimated deposits and inspection fees for all guaranteed improvements.
(D) Performance guarantees shall be in a form approved by the Building Commissioner and shall specify the terms and conditions noted below:
(1) Not less than 30 days prior to the expiration of such guarantee, the Village Comptroller shall be given written notice by means of certified or registered mail, indicating that such guarantee is to expire. No guarantee shall expire absent such notice.
(2) Failure of the developer to install such guaranteed improvements prior to the scheduled completion date, as specified in the approved site development schedule, shall be considered a default by the developer and the issuing institution.
(3) The guarantee shall only be released or reduced by the issuing institution upon written certification by the Building Commissioner stating:
(a) That said guarantee may be released or reduced in accordance with this section, and
(b) The amount of such discharge or reduction.
(4) If at any time the village determines that the institution issuing the guarantee is without adequate capital, assets, earnings and liquidity and is unable to meet any federal or state requirement for reserves, is insolvent, is in danger of becoming any of the foregoing, or is otherwise in danger of being unable to honor such guarantee at any time during its term, or if the village otherwise reasonably deems itself to be insecure, then the village shall have the right to demand that the developer provide a replacement guarantee from an institution satisfactory to the village. Such replacement guarantee shall be deposited with the village not later than ten days following such demand.
(5) If the developer fails or refuses to complete the construction of the public and private improvements, or reimburse a contract purchaser for a deposit made on a terminated sale contract covered by the guarantee, or to correct any defect or deficiency in such improvements upon request by the village, or in any other manner fails or refuses to meet fully any of its obligations under the guarantee or any other agreement, ordinance, rule, or regulation of the village, then the village may, in its sole and absolute discretion, retain all or any part of the guarantee. The village thereafter shall have the right to exercise any other action it deems reasonable and appropriate to mitigate the effects of such failure or refusal, and to reimburse itself or a contract purchaser from the proceeds of the guarantee for all of its costs and expenses, including legal fees and administrative expenses. If the funds remaining in the guarantee are insufficient to repay fully the village or all aggrieved contract purchasers for all such costs and expenses, and to maintain a cash reserve equal to the required guarantee during the entire time of such costs and expenses, and to maintain a cash reserve equal to the required guarantee during the entire time such guarantee should have been maintained, then the developer shall, upon demand of the village therefor, immediately deposit with the village such additional funds as the village determines necessary.
(E) Performance guarantees required under this section shall be in a form approved by the Village Comptroller. The following types of performance guarantee are acceptable, provided they are consistent with the regulations below.
(1) Cash escrow. A cash deposit may be used as a guarantee, provided the total amount of the guarantee required is placed with the Village Comptroller.
(2) Irrevocable letter of credit and cash; surety bond. An irrevocable letter of credit or surety bond may be used as a guarantee, provided such letter of credit or surety bond is issued by a financial institution approved by the Village Comptroller, and the letter of credit or surety bond is accompanied by a cash deposit in an amount not less than 10% of the total guarantee amount. The cash deposit shall, at all times until released, as provided herein, be maintained at not less than 10% of the initial total guarantee amount. The financial institution issuing the irrevocable letter of credit or surety bond shall be:
(a) Insured by the Federal Depository Insurance Corporation or Federal Savings and Loan Insurance Corporation;
(b) Chartered in the State of Illinois or have a registered agent in Illinois;
(c) Have adequate capital, assets, earnings and liquidity to ensure the financial soundness of the issuing institution, as determined by the Village Comptroller; and
(d) In the case of a surety bond, be licensed and authorized by the Illinois Department of Insurance to sell and issue sureties in the State of Illinois.
(F) The developer may make a written request to the Building Commissioner to partially reduce the amount of the approved performance guarantee. The Building Commissioner shall be authorized to approve such partial reductions in the amount of the performance guarantee, provided:
(1) There shall be no more than three partial reductions approved in the amount of the performance guarantee during the life of the subdivision;
(2) Partial reductions shall be authorized only following the acceptable completion of the following improvements:
(a) All underground storm drainage, sanitary sewer and water supply systems have been properly installed and all erosion and sediment controls are operational;
(b) All curb, gutter, sidewalk and base course paving for public and private streets have been properly constructed; and
(c) All lots have been graded and all storm detention facilities are operational;
(3) The inspection reports for the subdivision evidence acceptable completion of the above;
(4) The amount of such partial reduction shall not exceed 75% of the estimated cost to construct such improvements;
(5) In no event shall the amount of the performance guarantee be reduced to a level which, in the sole and absolute opinion of the Building Commissioner, would not allow the village to complete the installation of public and private improvements associated with the subdivision; and
(6) In no event shall any portion of the cash deposit be reduced prior to final release of the performance guarantee pursuant to this section.
(G) Acceptance of any dedicated public improvements in any condominium project shall be as set forth in applicable village ordinances or as set forth in any agreement or other document concerning the property.
(Ord. 7-56, passed 8-15-07)