(A) Security. Security to guarantee the satisfactory completion of subdivision improvements shall meet the following requirements:
(1) Form. Security may be in the form of cash deposit, a performance bond, a letter of credit from a bank approved of and insured by the Federal Deposit Insurance Corporation (F.D.I.C.) (or any successor agency thereto), or an escrow or impound account in a bank approved of and insured by the F.D.I.C. All security shall be in a form satisfactory to the City Attorney. The City Attorney, Administrator, or City Council shall have the right to reject any form of security he or it believes would be inadequate (for any reason) to guarantee the completion of all uncompleted improvements.
(2) Amount. The aggregate amount of all security shall be equal to the total estimated cost of completing all the uncompleted improvements. The amount of a particular “item of security” (such as a particular cash deposit, bond, escrow account, and the like) shall equal the estimated cost of completing the improvements covered by such security. The cost estimates shall be made by the subdivider’s professional engineer, but must be approved by the City Engineer.
(3) Posted with whom. Security for improvements which are to be dedicated to the city shall be posted with the City Clerk. Security for improvements to be dedicated to some other governmental entity shall be posted with the official designated by that other entity.
(4) Term. The initial term of security for any subdivision improvement within the city’s subdivision jurisdiction shall not exceed two years. If any improvement which is to be dedicated to the city has not been completed by the end of the two-year period, the Administrator, with the advice and consent of the City Council may either extend the security for successive one-year periods, or may proceed as per division (D) below.
(B) Sureties. There shall be a surety for every performance bond posted as security. No person shall be eligible to act as a surety unless he has been approved by the City Council. Any surety who improperly fails to perform within 90 days after written notice from the City Council shall be ineligible for two years thereafter to act as surety for any subdivision improvement within the city’s jurisdiction.
(C) Release of security.
(1) The City Clerk may release up to 90% of the amount of security from time to time upon written authorization from the City Council. The amount which the City Council authorizes to be released shall be equal to the value (as determined by the subdivider’s professional engineer and approved by the City Engineer) of the completed improvement(s) covered by such security.
(2) Ten percent of the amount of eve security posted with the city shall be retained until:
(a) The City Engineer has certified to the Administrator in writing that all public improvements have been satisfactorily completed; and
(b) All public improvements have been dedicated to the city or other appropriate governmental entity; and
(c) The subdivider has filed the “Record Drawings” with the Administrator.
(D) Failure to complete improvements. If a secured improvement has not been completed at the expiration of the term of the security (two years, or longer if extension(s) has been granted), the Administrator, with the consent of the City Council and the assistance of the City Attorney, may:
(1) Require the subdivider to submit new security in an amount sufficient to cover any increase in the cost of constructing the improvements) in question; or
(2) Require the surety or financial institution to pay to the city an amount equal to the cost of completing the required improvement(s) or the amount of the security not theretofore released, whichever is less.
(Ord. 1402, passed 2-24-1998)