(A) Required improvements. The applicant shall post adequate performance surety (also referred to herein as "performance surety") for all unconstructed public improvements shown on the plat and construction plans associated with that phase or section being recorded. Any amounts necessary for the construction of drainage structures and improvements depicted on the construction plans shall also be included in the performance surety. The developer will submit construction costs (supported by a reputable contractor's bid) to be reviewed by the city. The city will set the performance surety amount as sufficient to secure the satisfactory construction, installation, and acceptance of required improvements. The performance surety shall remain in force until the improvements comply with the approved construction drawings as determined by the city and all warranty periods are expired.
(B) Performance surety amount. The minimum amount of the performance surety shall be an amount equal to not less than 120% of the cost of installation of required improvements. The proposed amount of the cost of materials and installation of required improvements shall be calculated and signed by the applicant's contractor and submitted to the city for approval. The proposed amount shall include a detailed itemized estimate of all items including incomplete items on the date the estimate is prepared.
(C) Composition of performance surety. For the purpose of these regulations, performance surety shall consist of two documents: a performance agreement provided to the Public Works Department and an accompanying security document.
(1) The performance agreement. The performance agreement shall be in a similar form as shown in the relevant appendix to this document and shall stipulate the work to be performed by general categories and the estimated value or cost of each category. The performance agreement shall be entered into by owner or developer of the property, the lending institution, and approved and signed by the city, but shall run with the land and likewise, jointly and severally, obligate subsequent owner(s) as stated in the performance agreement.
(2) The security document (irrevocable letter of credit). The security document shall be in a similar form as shown in the relevant appendix to this document and shall express the value in a total amount equaling the sum of all work categories. Further, the security document must be acceptable to the city in its terms, the amount of the security, and financial institution providing said document.
(D) Owner/developer past performance. The letter of credit option shall not be available to an owner or developer, without specific Planning Commission approval, whose past performance over the two preceding calendar years has resulted in breached or expired bonds.
(E) Financial institution past performance. A financial institution whose past performance has resulted in non-payment of a letter of credit may be excluded from providing a letter of credit for any owner or developer for a period of five calendar years from the date of breach as determined by the Planning Commission.
(F) Temporary improvements. When applicable, the applicant shall build and pay for all costs of temporary improvements required by the Planning Commission and shall maintain such for the period specified by the Planning Commission. Prior to construction of any temporary facility or improvement, a performance surety shall be posted which shall insure that the temporary facilities shall be properly constructed, maintained, and removed.
(G) Costs of improvements. All required improvements shall be made by the applicant at the applicant's expense. Any provisions for reimbursement by the city or any utility district shall be by separate agreement with the city.
(H) Governmental agencies. Governmental agencies to which these sureties and contract provisions apply may file, in lieu of said contract or surety, a certified resolution, or ordinance from officers or agencies authorized to act in their behalf agreeing to comply with the provisions of this chapter.
(I) Failure to complete improvements. In those cases, in which a performance surety has been posted and required improvements have not been installed within the terms of such performance surety agreement, the city may declare the surety to be in default and require that all the improvements be installed regardless of the extent of the building development at the time the performance surety is declared to be in default.The funds of the performance surety shall be used to complete the improvements. The city may, in the pursuit of executing the committed improvements, exercise the right to file suit against all entities, jointly and severally, responsible for said obligations.
(Ord. 2022-007, passed 3-14-2022)