The Plan Commission may permit a developer to file in lieu of the surety bond called for in Article IV, Division IV, a cash bond guaranteeing that the improvements will be completed as follows:
(A) Undertaking in Lieu of Completion Bond.
WHEREAS, the statutes of the State of Illinois grant to a municipal corporation the right to require that a developer constructing certain improvements within that community guarantee the construction of such improvements by a completion bond or other security acceptable to the community; and WHEREAS, _________________ desires to construct a residential development within the ______________ of ______________, and that said municipality is willing to accept an undertaking from a financial institution in the nature of an irrevocable commitment in lieu of such completion bond.
NOW, THEREFORE, are the following representations made by the owner and/or developer to the of ______________ , as follows:
1. THAT is the owner and/or developer of the property legally described in Clause 2 of this undertaking, and shall hereinafter be referred to as “OWNER”; and, THAT the ______________ of ______________ shall hereinafter be referred to as “MUNICIPALITY”.
2. THAT THE OWNER is the legal title holder of the following described property:
[LEGAL DESCRIPTION]
3. THAT THE OWNER shall be required to install and guarantee the installation of streets, sidewalks, street lights, sanitary sewers, storm sewers, water lines, recreational facilities (including structures), and common landscaping. In order to guarantee that such facilities shall be installed, the OWNER shall submit to the municipal engineer such specifications and estimated engineering costs as shall be required to meet with his approval. In aiding the municipal engineer in determining the amount of reasonably anticipated costs for the construction of such improvements, the OWNER may submit to the engineer signed contracts for the construction of such improvements. The municipal engineer, upon being satisfied that the design of the required improvements are in accordance with the ordinances of the MUNICIPALITY and in accordance with good engineering practices, shall estimate and certify an amount which shall represent
one hundred ten percent (110%) of the reasonably estimated cost of completing the required improvements for which the MUNICIPALITY is requiring a completion guarantee.
4. [THAT except for the issuance of building permits for a reasonable number of models], the OWNER shall not be entitled to the issuance of [further] building permits until and unless said OWNER shall submit to the MUNICIPALITY an irrevocable financial commitment from a bank, savings and loan, or mortgage company approved by the MUNICIPALITY in the amount certified by the Municipal Engineer.
5. THAT the written irrevocable financial commitment shall be issued in favor of the MUNICIPALITY from a banking or lending institution in a form to be approved by the City Council and substantially similar to the form marked Appendix “A” and appended to this agreement. (Ord. No. 1249; 06-14-04)
6. THAT THE OWNER guarantees the workmanship of the public improvements to be installed upon the site for a period of one (1) year after their donation to the MUNICIPALITY . Upon final completion of the streets, sidewalks, street lights, sanitary sewers, storm sewers, and water mains, the OWNER shall execute a Bill of Sale for those items which are personal property. For a period of one (1) year after the granting of the Bill of Sale in the case of personal property, and the acceptance for maintenance in the case of streets and sidewalks, all necessary repairs to such facilities shall be the responsibility of the OWNER.
IN WITNESS WHEREOF ____________________________ has hereunto set his hand and seal this ______________ day of ____, 20____.
(OWNER)
APPROVED by the ____________ of ____________ this ____________ day of ____, 20____.
BY: ________________________
(MUNICIPALITY)
(MUNICIPALITY)
(B) [Letterhead of Bank, Savings and Loan or Mortgage House]
________, 20____
GENTLEMEN:
We hereby establish our irrevocable credit in favor of ____________ [developer] , or the municipality of ____________ in the amount of Dollars (____). We understand that this irrevocable credit is to be used to construct the following improvements in the residential development known as to be constructed within the ________, Illinois:
streets; sidewalks; street lights; the portion of sanitary sewers, storm sewers, and water mains to become municipality-owned; recreational facilities (including a recreational building and a swimming pool and appurtenances thereof); and landscaping in common areas.
The development is legally described as follows:
[Legal Description]
We shall make payouts from this irrevocable commitment as follows:
If we have not been notified by the municipality of a default by the owner and/or developer, we shall disburse the funds for labor and materials furnished by contractors in accordance with the sworn statement on order of the owner, the submission of proper lien waivers from the contractors engaged in such work, and the certificate by the Municipal Engineer, ____________[his name] ____________ that such work has been properly completed, however, that we shall withhold from each payment made under such sworn statement(s) or order(s) an amount equal to ten percent (10%) thereof until all improvements have been completed except final surfacing of the streets and sidewalks, at which time the ten percent (10%) sum withheld shall be disbursed less a sum equal to one hundred twenty-five percent (125%) of the cost of the final surfacing of the streets, which sum shall be finally disbursed when the work has been completed and the requirements of certification and lien waivers as has been hereinabove set out have been met.
The required improvements shall be completed in accordance with the following schedule: [Insert Schedule]
If we receive a resolution of the corporate authorities of the municipality indicating that the owner and/or developer has failed to satisfactorily complete or carry on the work of the installation and construction of the required improvements, and such resolution indicates that the owner and/or developer has been notified that the municipality finds that a breach of the owner's and/or developer's obligations has occurred and have not been cured within a period of thirty (30) days, that in such case, we shall make payments for materials and labor to such contractor(s) or subcontractor(s) retained by the municipality who have completed the
improvements in substantial accordance with the plans and specifications of the owner and/or developer; such payments shall be made upon the certification of the municipal engineer that the work has been completed and the submission of proper waiver of liens from the contractor(s) or subcontractor(s). The amount of the payouts shall be in accordance with the retention provisions as previously set out.
The irrevocable credit established by us shall be in force for a period of years, and shall remain in effect without regard to any default in payments of sums owned by us by the owner and/or developer and without regard to other claims which we may have against the owner and/or developer. Sixty (60) days prior to the expiration of this irrevocable credit we shall notify the corporate authorities of the municipality, by registered letter, return receipt requested, of the impending expiration date. This commitment shall not terminate without such notice. If the work covered by this commitment has not been completed within the time set forth in this agreement, the municipality may, at its option, continue drawing funds as otherwise provided for an additional period of one (1) year. It is recognized that the municipality is according to the owner and/or developer the permission to proceed with the development project expressly upon the guarantee of the irrevocable nature of this commitment. It is further acknowledged that the consideration for this irrevocable commitment is provided by agreements between this financial institution and the developer. The sum of this credit shall, however, be reduced in the amount of disbursements made from time to time in accordance with the terms under which this credit is extended as set out above.
