(a) The Council shall insure, through receipt of certificates of compliance submitted and attested by the Borough Engineer, with review of the Planning Commission, that the required improvements have been installed according to the specifications of the final plan, or as an alternative, require the posting of adequate surety to cover the cost for such improvements. The Council may also insure, through the posting of bonds or other surety, rights of way and road surfaces which are in any manner utilized for transport or related purposes during development and construction associated with subdivision development.
(b) The Council shall specify one of the following alternatives, or such other alternatives as may be acceptable, for guaranteeing compliance with the requirements of this section. Final approval of a plan may not be granted by the Council until the surety required is fully provided. In any event, the required surety shall be secured along with the written agreement prior to any construction or related activity.
(1) Completion of improvements prior to final approval. Prior to final plan approval, the developer shall complete, in a manner satisfactory to the Council and the Borough Engineer, all improvements required in these Subdivision and Land Development Regulations as specified in the final subdivision plan, and as preliminarily approved by the Council, and shall dedicate the same to the Borough in accordance with these Regulations.
(2) Guarantee of future performance. In lieu of requiring the completion of all improvements prior to final plan approval, the Borough may, at its discretion, enter into an agreement with the developer whereby the developer shall guarantee to complete all improvements required by these Subdivision and Land Development Regulations, or otherwise specified by the Borough and in a manner satisfactory to the Council. To secure this agreement, the developer shall provide, subject to approval of the Borough, one of the following guarantees:
A. Surety bond. The developer shall obtain a security bond from a surety bond company authorized to do business in the Commonwealth. The bond shall be payable to the Borough. The amount of financial security shall be equal to 110 percent of the cost of the required improvements as estimated by the developer and approved by the Borough Engineer. The duration of the bond shall be until such time as the improvements are accepted by the Borough in accordance with the requirements of these Regulations.
B. Escrow account. The developer shall deposit cash or another instrument readily convertible into cash at face value, either with the Borough or in escrow with a bank. In the use of any instrument other than cash, and in the case of an escrow account, the bank with which the funds are to be deposited shall be subject to the approval of the Council. The amount of financial security shall be equal to 110 percent of the cost of the required improvements as estimated by the developer and approved by the Borough Engineer. In case of an escrow account, the developer shall file with the Board an agreement between the financial institutions and himself or herself, guaranteeing the following:
1. That the funds of said escrow account shall be held in trust until released by the Borough and may not be used or pledged by the developer as security in any other matter during the period; and
2. That in the case of a failure on the part of the developer to complete said improvements, the financial institution shall immediately make the funds in said account available to the Borough for use in the completion of those improvements.
C. Property escrow. The developer shall offer as a guarantee land or other property, including corporate stocks or bonds. The value of any such property shall be at least equal to 110 percent of the cost, as estimated by the developer and approved by the Borough Engineer, of the installation of all contracted improvements. The established value of any property so used shall take into account the likelihood of a decline in the value of said property during the guarantee period. The Borough shall retain the right to reject the use of any property when it believes that the property will be unusually difficult to sell, or for other reasons such as will inhibit the Borough from exchanging the property for a sufficient amount of money to complete the required improvements.
When property is offered as an improvement guarantee, the developer shall:
1. Execute an agreement with the trustee when it is not the Borough, instructing the trust to release the property to the Borough in case of default. The agreement shall also state that the property may be released only upon consent of the Borough. The agreement shall be placed on file with the Borough Secretary/Treasurer.
2. File with the Borough an affidavit affirming that the property to be used as a guarantee is free and clear of any encumbrances or liens at the time it is to be put in trust; and
3. Execute and file with the Borough an agreement stating that the property to be placed in trust as an improvement guarantee will not be used for any other purpose or pledged as a security in any other matter until it is released by the Borough.
D. Extension of guarantees. If the developer requires more than one year from the date of posting financial security to complete the required improvements, the amount of security may be increased to assure that financial security equals 110 percent. Any additional security shall be posted by the developer in accordance with this section.
(Ord. 2143. Passed 8-16-93.)