It is recognized by the governing body that
the adequate provision of on-tract improvements and, to the extent
required to properly service the project, off-tract improvements are
a prime concern when evaluating an application for development under
this chapter. The sections that follow are designed to give direction
to an applicant with regard to improvements that are required and
the procedures regarding them.
[Amended 11-13-2018 by Ord. No. 2018-OR-026]
A. Guarantees: performance guarantee; safety and stabilization guarantee;
temporary certificate of occupancy guarantee; maintenance guarantee.
Before filing of a final subdivision plat or recording of minor subdivision
deeds or as a condition of final site plan approval or as a condition
to the issuance of a zoning permit pursuant to N.J.S.A. 40:55D-65d,
the developer shall provide the Township with a performance guarantee
and a maintenance guarantee for the purpose of assuring the installation
and maintenance of certain on-tract improvements and any dedicated
off-tract improvements required as a condition of approval. The guarantees
shall be in the form authorized by N.J.S.A. 40:55D-53a and approved
by the Township Attorney as to form, sufficiency and execution. A
developer may be required to provide a safety and stabilization guarantee,
and if the developer requests a temporary certificate of occupancy,
the developer may also be required to provide a temporary certificate
of occupancy guarantee.
(1) Performance guarantee.
(a)
The developer shall furnish a performance guarantee in favor
of the Township in an amount not to exceed 120% of the cost of installation
of only those improvements required by an approval or developer's
agreement, ordinance, or regulation to be dedicated to a public entity,
and that have not yet been installed, which cost shall be determined
by the Township Engineer based on documented construction costs for
public improvements prevailing in the general area of the Township,
for the following improvements as shown on the approved plans or plat:
streets, pavement, gutters, curbs, sidewalks, street lighting, street
trees, surveyor's monuments as shown on the final map as required
by the Map Filing Law (N.J.S.A. 46:23-9.9 et seq.: repealed by Section
2 of Chapter 217 of the Public Laws of 2011) or N.J.S.A. 46:26B-1
through 46:26B-8, water mains, sanitary sewers, community septic systems,
drainage structures, public improvements of open space, and any grading
necessitated by the preceding improvements.
(b)
The Township Engineer shall prepare an itemized cost estimate
of the improvements covered by the performance guarantee, which itemized
cost estimate shall be appended to each performance guarantee posted
by the obligor.
(c)
Upon the recommendation of the Planning Board or Zoning Board
of Adjustment Engineer, in consultation with the Board Planner, the
approving authority may require, as a condition of approval, that
the performance guarantee include as a line item privately owned perimeter
buffer landscaping within an approved phase or section of a development.
The developer may elect to post a separate performance guarantee for
the privately owned perimeter buffer landscaping.
(2) Safety and stabilization guarantee.
(a)
A developer shall furnish to the Township a safety and stabilization
guarantee, which at the developer's option may be furnished either
as a separate guarantee or as a line item of the performance guarantee.
The safety and stabilization guarantee shall be available to the Township
solely for the purpose of returning property that has been disturbed
to a safe and stable condition or otherwise implementing measures
to protect the public from access to an unsafe or unstable condition,
only in the circumstance that site disturbance has commenced and,
thereafter, all work on the development has ceased for a period of
at least 60 consecutive days following such commencement for reasons
other than force majeure and work has not recommenced within 30 days
following the provision of written notice by the Township to the developer
of the Township's intent to claim payment under the guarantee. The
Township shall not provide notice of the intent to claim payment under
a safety and stabilization guarantee until a period of at least 60
days has elapsed during which all work on the development has ceased
for reasons other than force majeure. The Township shall provide written
notice to the developer by certified mail or other form of delivery
providing evidence of receipt.
(b)
The amount of a safety and stabilization guarantee for a development
with bonded improvements in an amount not exceeding $100,000 shall
be $5,000. The amount of the guarantee for a development with bonded
improvements exceeding $100,000 shall be calculated as a percentage
of the bonded improvement costs of the development or phase of the
development as follows: $5,000 for the first $100,000 of bonded improvement
costs, plus 2.5% of bonded improvement costs in excess of $100,000
up to $1,000,000, plus 1% of bonded improvement costs in excess of
$1,000,000.
(c)
The Township shall release a separate safety and stabilization
guarantee to a developer upon the developer's furnishing of a performance
guarantee which includes a line item for safety and stabilization
in the amount required above.
(d)
The Township shall release a safety and stabilization guarantee
upon the Township Engineer's determination that the development of
the project site has reached a point that the improvements installed
are adequate to avoid any potential threat to public safety.
(3) Temporary certificate of occupancy guarantee. A developer seeking
a temporary certificate of occupancy for a development unit, lot,
building, or phase of development, as a condition of issuance, shall
furnish a temporary certificate of occupancy guarantee in favor of
the Township in an amount equal to 120% of the cost of installation
of only those improvements or items which remain to be completed or
installed under the terms of the temporary certificate of occupancy
and which are required to be installed or completed as a condition
precedent to the issuance of the permanent certificate of occupancy
for the development unit, lot, building or phase of development and
which are not covered by the existing performance guarantee. Upon
posting a temporary certificate of occupancy guarantee, all sums remaining
under the performance guarantee which relate to the development, unit,
lot, building, or phase of development for which the temporary certificate
of occupancy is sought shall be released. The scope and amount of
the temporary certificate of occupancy shall be determined by the
Township Engineer in consultation with the Township Code Official.
At no time may the Township hold more than one guarantee or bond of
any type with respect to the same line item. The temporary certificate
of occupancy guarantee shall be released at the direction of the Township
Council upon the issuance of a permanent certificate of occupancy
with regard to the development, unit, lot, building or phase as to
which the temporary certificate of occupancy relates.
(4) Maintenance guarantee.
(a)
The developer shall post with the Township, prior to the release
of the performance guarantee, a maintenance guarantee in an amount
not to exceed 15% of the cost of the installation of the improvements
which are being released.
(b)
The developer shall also post with the Township, upon the inspection
and issuance of final approval of the following private site improvements
by the Township Engineer, a maintenance guarantee in an amount not
to exceed 15% of the cost of the installation of the following private
site improvements: stormwater management basins, inflow and water
quality structures with basins, and the outflow pipes and structures
of the stormwater management system, if any, which cost shall be determined
by the Township Engineer according to documented construction for
costs for public improvements prevailing in the general area of the
Township.
(c)
The term of the maintenance guarantee shall be for a period
not to exceed two years and shall expire automatically at the end
of the term.
B. Other governmental agencies/public utilities. In the event that other
governmental agencies or public utilities automatically will own the
utilities to be installed or the improvements are covered by a performance
or maintenance guarantee to another governmental agency, no performance
or maintenance guarantee shall be required by the Township for such
utilities or improvements.
C. Extensions to complete bonded improvements. The time allowed for
installation of the bonded improvements may be extended by resolution
of the Township Council. As a condition or as part of any such extension,
the amount of any performance guarantee shall be increased or reduced,
as the case may be, to an amount not to exceed 120% of the cost of
the installation, which cost shall be determined by the Township Engineer
according to documented construction costs for public improvements
in the Township as of the time of the passage of the resolution.
D. Failure to complete or correct bonded improvements. If the required
bonded improvements are not completed or corrected in accordance with
the performance guarantee, the obligor and surety, if any, shall be
liable to the Township for the reasonable cost of the improvements
not completed or corrected and the Township may either prior to or
after the receipt of the proceeds complete the improvements in accordance
with the public bidding requirements of N.J.S.A. 40A:11-1 et seq.
E. Substantial completion/release of performance guarantee.
(1) Upon substantial completion of all required street improvements,
other than the top course, and appurtenant utility improvements and
their connection to the Township's utility system, the obligor may
request of the Township Council, in writing, sent by certified mail
addressed in care of the Township Clerk, with a copy to the Township
Engineer, that the Township Engineer prepare, in accordance with the
itemized cost estimate appended to the performance guarantee, a list
of all uncompleted or unsatisfactorily completed bonded improvements.
The request shall indicate which bonded improvements have been completed
and which bonded improvements remain uncompleted in the judgment of
the obligor. The Township Engineer shall inspect all bonded improvements
covered by the obligor's request and shall file with the Township
Council a detailed written list and report, and shall simultaneously
send a copy to the obligor not later than 45 days after receipt of
the obligor's request.
(2) The list prepared by the Township Engineer shall state, in detail,
with respect to each bonded improvement determined to be incomplete
or unsatisfactory, the nature and extent of the incompleteness of
each incomplete improvement or the nature and extent of, and remedy
for, the unsatisfactory state of each completed bonded improvement
determined to be unsatisfactory. The report prepared by the Township
Engineer shall identify each bonded improvement determined to be complete
and satisfactory, together with a recommendation as to the amount
of reduction to be made in the performance guarantee relating to the
completed and satisfactory bonded improvement, in accordance with
the itemized cost estimate appended to the performance guarantee.
(3) The Township Council, by resolution, shall either approve the bonded
improvements as determined complete and satisfactory by the Township
Engineer or reject any or all of these bonded improvements upon the
establishment in the resolution of cause for rejection and shall approve
and authorize the amount of reduction to be made in the performance
guarantee relating to the improvements accepted, in accordance with
the itemized cost estimate appended to the performance guarantee.
This resolution shall be adopted not later than 45 days after receipt
of the list and report prepared by the Township Engineer. Upon the
Township Council's adoption of the resolution, the obligor shall be
released from all liability pursuant to its performance guarantee,
with respect to those approved bonded improvements, except for that
portion adequately sufficient to secure completion or correction of
the improvements not yet approved, provided that 30% of the amount
of the total performance guarantee posted may be retained to ensure
completion and acceptability of all improvements. The safety and stabilization
guarantee shall be reduced by the same percentage as the performance
guarantee is being reduced at the time of each performance guarantee
reduction.
(4) For the purpose of releasing the obligor from liability pursuant
to its performance guarantee, the amount of the performance guarantee
attributable to each approved bonded improvement shall be reduced
by the total amount for each such improvement, in accordance with
the itemized cost estimate prepared by the Township Engineer and appended
to the performance guarantee, including any contingency factor applied
to the cost of installation. If the sum of the approved bonded improvements
would exceed 70% of the total amount of the performance guarantee,
then the Township may retain 30% of the amount of the total performance
guarantee and safety and stabilization guarantee to ensure completion
and acceptability of bonded improvements, except that any amount of
the performance guarantee attributable to bonded improvements for
which a temporary certificate of occupancy guarantee has been posted
shall be released from the performance guarantee even if such release
would reduce the amount held by the municipality below 30%.
F. Obligor remedies.
(1) If the Township Engineer fails to send or provide the list and report
as requested by the obligor within 45 days from receipt of the request,
the obligor may apply to the court in a summary manner for an order
compelling the Township Engineer to provide the list and report within
a stated time, and the cost of applying to the court, including reasonable
attorney's fees, may be awarded to the prevailing party.
(2) If the Township Council fails to approve or reject the bonded improvements
determined by the Township Engineer to be complete and satisfactory
or reduce the performance guarantee for the complete and satisfactory
improvements within 45 days from the receipt of the Township Engineer's
list and report, the obligor may apply to the court in a summary manner
for an order compelling, within a stated time, approval of the complete
and satisfactory improvements and approval of a reduction in the performance
guarantee for the approvable complete and satisfactory improvements
in accordance with the itemized cost estimate prepared by the Township
Engineer and appended to the performance guarantee, and the cost of
applying to the court, including reasonable attorney's fees, may be
awarded to the prevailing party.
G. Reduction of cash deposit. In the event that the obligor has made
a cash deposit with the Township as part of the performance guarantee,
then any partial reduction granted in the performance guarantee shall
be applied to the cash deposit in the same proportion as the original
cash deposit bears to the full amount of the performance guarantee,
provided that if the developer has furnished a safety and stabilization
guarantee, the Township may retain cash equal to the amount of the
remaining safety and stabilization guarantee.
H. Completion or correction following rejection. If any portion of the
required bonded improvements is rejected, the Township Council may
require the obligor to complete or correct such improvements and,
upon completion or correction, the same procedure of notification
shall be followed.
I. Right of obligor to pursue legal remedies. Nothing herein, however,
shall be construed to limit the right of the obligor to contest by
legal proceedings any determination of the governing body or the municipal
engineer.
J. Inspection fees.
(1) The developer shall reimburse the Township for reasonable inspection
fees paid to the Township Engineer for the inspection of improvements.
Inspection fees shall be posted in escrow and shall not exceed, except
for extraordinary circumstances, the greater of $500 or 5% of the
cost of bonded improvements that are subject to a performance guarantee,
and not to exceed 5% of the cost of private site improvements that
are not subject to a performance guarantee, which cost shall be determined
based upon documented construction costs for public improvements prevailing
in the general area of the Township.
(2) For those developments for which the inspection fees total less than
$10,000, fees may, at the option of the developer, be paid in two
installments. The initial amount deposited in escrow shall be 50%
of the inspection fees. When the balance on deposit drops to 10% of
the inspection fees because the amount deposited by the developer
has been reduced by the amount paid to the Township Engineer for inspections,
the developer shall deposit the remaining 50% of the inspection fees.
(3) For those developments for which the inspection fees total $10,000
or greater, fees may, at the option of the developer, be paid in four
installments. The initial amount deposited in escrow shall be 25%
of the inspection fees. When the balance on deposit drops to 10% of
the inspection fees because the amount deposited by the developer
has been reduced by the amount paid to the Township Engineer for inspection,
the developer shall make additional deposits of 25% of the inspection
fees.
(4) If the Township Administrator, based upon the recommendation of the
Township Engineer, determines that the amount in escrow for the payment
of inspection fees is insufficient to cover the cost of additional
required inspections, the Township Administrator may require the developer
to deposit additional funds in escrow by delivering to the developer
a written inspection escrow deposit request, signed by the Township
Engineer. The inspection escrow deposit request shall inform the developer
of the need for additional inspections, detail the items or undertakings
that require inspection, estimate the time required for those inspections,
and estimate the cost of performing those inspections.
K. Development in stages or sections. In the event that final approval
is by stages or sections of development, guarantees shall be applied
by stage or section.
L. Effect of dedication of improvements. To the extent that any of the
improvements have been dedicated to the Township on the subdivision
plat or site plan, the Township Council shall be deemed, upon the
release of any performance guarantee to have accepted dedication for
public use of streets or roads and any other improvements made thereon
according to site plans and subdivision plats approved by the approving
authority, provided that such improvements have been inspected and
have received final approval by the Township Engineer.
M. Types of guarantees. A performance guarantee may be any security
which may be accepted by a municipality, including but not limited
to surety bonds, cash, and letters of credit, provided that the letter
of credit:
(1) Constitutes an unconditional payment obligation of the issuer running
solely to the Township for an express period of time for the amount
determined in accordance with this chapter;
(2) Is issued by a banking or savings institution authorized to do and
doing business in New Jersey; is for a period of at least one year;
and
(3) Permits the Township to draw upon the letter of credit if the obligor
fails to furnish another letter of credit no less than 30 days or
more in advance of the expiration date of the letter of credit or
such longer period in advance thereof as is stated in the letter of
credit.