10-8-6 FINANCIAL ASSURANCE

1. Improvement installation guarantee: a. In lieu of actual installation of off-site and common open space improvements required by this chapter, and before final plat approval by the City council, the subdivider shall guarantee the installation of such improvements by one or a combination of the following financial guarantee methods: a corporate surety bond, a deposit in escrow with an escrow holder or a letter of credit with a financial institution. b. The guarantee shall be in an amount equal to 120% of the projected costs of required improvements as estimated by a licensed engineer retained by the subdivider and approved by the City engineer. The guarantee shall assure the actual construction of such improvements within two years immediately following the approval of the final plat by the City council and shall include a maintenance guarantee as required herein. c. The guarantee shall be filed with the City recorder. d. The guarantee shall be approved as to method, institution and form by the City attorney. 2. Default: In the event the subdivider defaults or fails or neglects to satisfactorily install required improvements within two years from date of approval of the final plat, the City council may declare the bond, escrow, deed of trust, or letter of credit forfeit and may execute thereon and install or cause the required improvements to be installed using the proceeds from the collection to defray the expenses thereof. The subdivider shall be responsible for all costs incurred by the City to complete the required improvements in excess of the proceeds of the guarantee amount. 3. Maintenance guarantee: The subdivider shall guarantee all off-site improvements will remain in good condition for a period of two year after the date of final acceptance by the City. The subdivider shall make all repairs to and maintain the improvements in good condition during that two-year period at no cost to the City. Upon completion of the improvements, the City shall retain at least 20% of the guarantee for a surety to cover the maintenance period. The exact amount retained shall be determined by the City public works director. Identifying necessary repairs and maintenance rests with the City public works director, whose decision upon the matter shall be final and binding upon the subdivider. The guarantee shall extend to and include, but shall not be limited to the entire street, subgrade, base, and surface and all pipes, joints, valves, backfill and compacting as well as the working surface, curbs, gutters, sidewalks, and other accessories that are, or may be, affected by construction operations. Whenever, in the judgment of the City public works director, the improvements shall need repairs, maintenance, or re-building, the City public works director shall cause a written notice to be mailed or given to the subdivider. Upon receipt, the subdivider shall undertake and complete such repairs, maintenance or re-building within the times required by the public works director. If repairs are not completed within the specified time, the City shall have such repairs made and the cost of such repairs shall be paid by the subdivider or by the City using the guarantee. The subdivider has the right to appeal the time limit that it was given to complete the repairs, to the City Council, provided a written appeal is received by the City Council prior to the expiration of the repair period. 4. Acceptance and release of surety: a. The subdivider shall submit to the City a copy of the as-built construction drawings. Acceptance of all improvements shall be in writing from the City engineer. b. Final inspection by the City public works director shall be made two year after all work has been completed and before release of the guarantee. All defects shall be corrected before acceptance by the City. c. Upon completion of off-site improvements and approval by the City public works director, the financial assurances may be released, at which time the subdivision will be deemed accepted. 5. Engineering review and inspection fee: In addition to the improvement and maintenance guarantee, the subdivider shall deposit with the City recorder a sum equal to five percent of the cost of the improvements to cover engineering review and public works inspection.