Agreement and bond for water system improvements

A. A subdivider may secure the department's recommendation for final subdivision approval prior to the completion of construction of the required water system improvements by entering into an agreement with the department to make, install and complete all of the required water system improvements within a specified time, and filing with the department a surety bond or other security, as specified in this section, to assure the department that the actual construction and installation of the improvements and utilities shown on the approved construction plans will be completed. B. The agreement shall require that the subdivider will complete the water system improvements to the satisfaction of the department, and shall further provide that if the subdivider shall fail to so complete such improvements within the time specified, or such extension as may be mutually agreed upon, the department may complete the same and recover the full cost and expense thereof from the subdivider. C. The bond or other security to be filed with the department shall be one of the following, provided that in all instances where a surety bond is filed, it shall be executed by the subdivider, as principal, and by a surety company authorized to do business in the State of as a surety: 1. A surety bond in a sum equal to 100 percent of the cost of the work required to be done as estimated by the department; payable to the department; conditioned upon the full and complete performance of all work required to be done by the subdivider; provided that should the subdivider fail to complete all work required to be done within a specified time, the department may cause all work to be completed; and that the parties executing the bond shall be firmly bound for the payment of all costs thereof; or 2. Where the subdivider has entered into a contract with a licensed contractor, the subdivider shall file all of the following with the department: a. A certified copy of the subdivider's contract and specifications; b. A certified copy of a 100 percent performance bond of the subdivider's contractor; and c. A separate surety bond in a sum equal to at least 50 percent of the cost of all work required to be done by the subdivider as estimated by the department, and payable and conditioned as above set forth; or 3. The subdivider shall make a cash deposit with the department, or to a licensed escrow company designated by the director as agent of the department, in an amount equal to 100 percent of the cost of the construction of improvements as estimated by the department. Subject to the review and approval of the director and the department of corporation counsel, an agreement may be entered to provide for approved progress payments to be made to the subdivider's contractor for materials used and services and labor performed out of deposit as the work progresses, provided that such progress payments shall at no time exceed the value of the completed portion of the improvements; or 4. In lieu of a surety bond or cash deposit, a subdivider may deposit with the department other negotiable instruments or securities acceptable to the director, and reviewed and approved by the department of the corporation counsel. (Ord. No. 3730, § 1, 2010)