Laserfiche WebLink
<br />JUDICIAL REACTION <br /> <br />01)233'7 60 <br /> <br />5-350 <br /> <br />350. PERFORMANCE BONDS <br /> <br />Enabling statutes usually authorize subdivision review agencies <br /> <br />to allow subdividers to post performance bonds <br />undertake all improvements prior to final plat <br /> <br />rather than <br />Ill. <br />approval. , <br /> <br />~~ <br /> <br />(See Column 5 of Appendix B <br /> <br />for a list of these statutes.) <br /> <br />, <br />Performance bonds are sums of money placed in escrow by the sub- <br /> <br /> <br />divider which may be used by the munioipality to complete sub- <br /> <br /> <br />division improvements if the subdivider does not complete the <br /> <br /> <br />improvements aspromiseJ.l2The bonding arrangement serves a <br />that <br /> <br />double objective. First, it assures/a municipality will not <br /> <br />be left with an unimproved subdivision laoking streets" se\~ers, <br /> <br />water and other facilities if the subdivider defaults or goes <br /> <br />ba~krupt.Second, it allows the subdivider to install improve- <br /> <br />mentsin an orderly fashion and permits <br /> <br />staqed financinq. <br /> <br />Typically the subdi videJ:: pays a bonding agency to plaoe <br /> <br />in escrow a su.m agreed upon by the planning. <br />commission and the subdivider. He constructs streets, water, <br /> <br />sewers, drainage facilities and other improvements in one <br /> <br />portion. of the subdivision and sells these lots. The funds <br />from lot sales are used to complete improvements on other lots. <br /> <br />. When all improvements are installed as agreed, the municipality <br /> <br />releases the bond: Usually performance bonds are held by the <br />muncipa1ityfor a specified period of time. <br /> <br />ments <br /> <br />~9dicial support for <br />. h l' 113 <br />~s overw e m~ng. <br /> <br />reasonable performanoe bond require- <br /> <br />Performance bond techniques have <br /> <br />wide use to facilitate staged installation of drainage facili- <br />ties. However, they should not be used to allow the subdivider <br />to sell lots for immediate use which lack adequate building <br />sites or protection against serious floods even though the sub- <br />divider intends to undertake flood protective works in the future~ <br /> <br />. ...._~ <br />-':-<c'.,-:-", <br />-;./:;:j <br />