(A) No final subdivision plat will be approved by the town unless one or more of the following methods of assurance are submitted with the final plat.
(1) Performance bond.
(a) The subdivider may post a performance bond at the time of application for subdivision approval in an amount equal to 150% of the present cost of all required improvements.
(b) Such performance bond shall comply with all statutory requirements and shall be satisfactory to the Town Attorney as to form, sufficiency, and manner of execution as set forth in this title.
(c) The period within which required improvements must be completed shall be specified by the Town Council in the resolution approving the final subdivision plat and shall be incorporated in the bond and shall not, in any event, exceed two years from the date of final approval.
(d) Such bond shall be approved by the Town Council as to amount and surety and conditions satisfactory to the governing body.
(e) The Town Council may, upon proof of difficulty, recommend to the Town Council extension of the completion date set forth in such bond for a maximum period of one additional year.
(f) The Town Council may at any time during the period of such bond accept a substitution of principal of sureties on the bond upon recommendation of the Town Council.
(2) Escrow account.
(a) The subdivider shall deposit cash, or collateral readily convertible to cash at face value, either with the Town Council or in escrow with a bank in an amount equal to 150% of the present cost of all required improvements. The use of collateral other than cash, and the selection of the bank with which funds are to be deposited are subject to the approval of the Town Council.
(b) When an escrow account is to be employed, the subdivider shall file with the Town Council his or her agreement with the bank guaranteeing the following:
1. The funds in the escrow account are to be held in trust until released by the Town Council and may not be used or pledged by the subdivider as security for an obligation during that period; and
2. In case the subdivider fails to complete the required improvements, the bank shall immediately make the funds in escrow available to the town for the completion of these improvements.
(3) Property escrow. The subdivider may offer as a guarantee land or other property equal in value to 150% of the present cost of all required improvements. A qualified real estate appraiser shall establish the value of any real property so used and, in so doing, shall take into account the possibility of a decline or rise in the value of the property during the guarantee period. The Town Council reserves the right to reject the use as collateral of any property when the value of the property is unstable, when the property may be difficult to sell, or when other factors exist which will inhibit the Town Council from exchanging the property for an amount of money sufficient to complete the required improvements. When property is offered as an improvement guarantee, the subdivider shall:
(a) Execute an agreement with the escrow agent when it is not the town, instructing the agent to release the property to the town in the case of default. The agreement shall be placed on file with the County Clerk;
(b) File with the Town Council a title insurance policy affirming that the property to be used as guarantee is free and clear of any encumbrances or liens at the time it is to be put in escrow; and
(c) Execute and file with the Town Council an agreement stating that the property to be placed in escrow 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 Town Council. Such agreement shall be sufficient to constitute a lien on the real property pledged in favor of the town on the real property.
(4) Irrevocable letter of credit. Subject to the approval of the Town Council, the subdivider shall provide an irrevocable letter of credit from a bank or other reputable institution or individual. This letter shall be deposited with the Town Council and shall verify the following.
(a) The creditor guarantees funds in an amount equal to 150% of the present cost, as estimated by the Council, of completing all required improvements.
(b) If the subdivider fails to complete the specified improvements within the required period, the creditor will pay to the town immediately, and without further action, such funds as are necessary to finance the completion of those improvements, up to the limit of credit stated in the letter.
(c) This irrevocable letter of credit may not be withdrawn, or reduced in amount until released by the Town Council.
(5) Construction of improvements prior to final plat recordation. If the subdivider chooses to construct the required improvements prior to the recording of the final plat, he or she shall submit the construction plans to the Town Engineer. A certificate by the subdivider’s engineer on the as built plans stating the construction conforms to the specifications and standards contained in or referred to herein must be presented to the Town Council prior to the approval of the final plat.
(B) Assurances shall be maintained for a specific period of time necessary to ensure completion of the required improvements within the time period determined by the governing body, not to exceed two years. Extensions of this period shall be granted only upon timely application by the subdivider to the governing body and upon consent of the issuer of the assurance and governing body.
(Prior Code, § 12-6-3)