[Amended 1-24-2013 by Res. No. 13-01-002]
Performance security shall be required to assure completion
of construction of sewer lines and appurtenances and other facilities
that are constructed pursuant to an approved land development or subdivision
plat as defined by the Pennsylvania Municipalities Planning Code. The purpose of the security is to assure completion of
construction of the sewer lines and appurtenances and other facilities
and to guarantee the timely delivery by the developer to the Authority
of as-built plans of the sewer system and the timely dedication of
the system the by the developer to the Authority (if applicable) and
the timely payment of all deposits and expenses related thereto.
A. Amount of performance security.
(1) The amount of the performance security shall be equal to 110% of
the cost of the improvements to be completed within one year, as established
by submitting to the Authority a bona fide bid from a contractor chosen
by the party posting the performance security. In the absence of a
bona fide bid, the cost shall be established by an estimate prepared
by the Authority's engineer. An additional 10% shall be required for
each one-year period beyond the first anniversary date of the posting
of financial security. For purposes of determining financial security
for the construction of sewer facilities, the estimated cost of the
improvement shall not include any portion of the extension to be paid
for by the Authority.
(2) If the developer disputes the Authority's estimated cost of the sewer
improvements, then the Authority shall confirm and recalculate said
estimate. If the developer still disputes the estimated cost, then
the estimate shall be recalculated and certified by an independent
professional engineer licensed as such in the state and chosen mutually
by the Authority and the developer. The estimate certified by the
independent engineer shall be presumed fair and reasonable and shall
be the final estimate. In the event that an independent engineer is
so chosen, fees for the services of said engineer shall be paid equally
by the Authority and the developer.
B. Duration of performance security. The minimum time period of the
performance security shall be one year, which security must be reissued
before expiration if completion will be beyond one year. Commencement
of construction shall not be a condition precedent to applicability
and enforceability of the security.
C. Form of performance security. All performance security shall be of
a type and a form that is permitted by law and acceptable to the Authority
and shall include but not be limited to security through federally
chartered or commonwealth-chartered lending institution's irrevocable
letters of credit or restrictive or escrow accounts in these lending
institutions.
D. Release of performance security.
(1) As work progresses on the sewer system, the developer may request
the release of portions of the performance security. The request shall
be in writing, addressed to the Authority, and the Authority shall
have 45 days after receiving a request to ascertain that the portion
of the work has been completed in accordance with the terms of the
builder's agreement (Appendix SF). The Authority shall act to approve
or disapprove the developer's request for the Authority to release
portions of the performance security within 45 days after receiving
such request. If the Authority fails to act within the forty-five-day
period, it shall be deemed to have approved the requested release
of funds.
(2) If, however, the developer fails to comply with all requirements
necessary for the release of the performance security, and said requirements
cannot be met to the satisfaction of the Authority, then the Authority
may, at its discretion, either extend the period during which the
Authority will keep the performance security until such time as the
problems are resolved, or the Authority may take any necessary action
to complete the construction, or to provide the "as-builts," or to
execute the deed of dedication, as may be necessary, and deduct the
necessary money from the performance security. Only after all such
requirements are met to the Authority's satisfaction shall the Authority
release any remaining performance security.
E. Minimum amount required for performance security. At no time prior
to final completion of the sewer system and final acceptance by the
Authority through the proper deed of dedication shall the performance
security posted by the developer hereunder be reduced below an amount
equal to 10% of the total amount of performance security originally
posted by the developer.