Township of Bethlehem, PA Article VIII Improvements Guarantees

§ 230-43 Guarantee of improvements installation required.

A. Before approving any subdivision or land development plan for recording, the Board of Commissioners shall require that the Township be assured (by means of a proper development agreement and performance guarantee) that the improvements required by this chapter and the improvements appearing on the plan will be installed in strict accordance with the standards and specifications of this chapter.

B. Purpose of bond. The bond and other surety agreements shall stand as security for compliance with all Township ordinances, other laws, covenants, stipulations, conditions and rules applicable to the subdivision for which it is filed.

C. No construction of buildings or paving or sales of any individual lot or condominium unit within a subdivision shall take place in any subdivision unless:

(1) There is on file, with the Township, a current duly executed performance bond (and security escrow agreement if necessary); or

(2) Unless all required public improvements, utilities, streets, drainage improvements and easements, sewers and streetlights and all grading necessary to support these public improvements have been completed and accepted by the Board of Commissioners.

D. If a developer chooses to install all required improvements prior to any building, in place of using performance guarantees, the Township shall as deemed necessary require the developer to have adequate insurance, hold harmless agreements and an escrow account to cover the costs of inspections.

E. Required improvements for performance guarantee. For the purposes of this chapter, and for use in determining the amount of performance guarantee that a developer is required to post with the Township, the term "required improvements" shall mean:

[Added 7-6-2009 by Ord. No. 07-09]

(1) All those improvements to be constructed by the developer to be dedicated to the Township as public improvements; and

(2) Such other improvements that are determined by the Township to be common amenities of a public interest, including but not limited to roads, stormwater detention and/or retention basins and other related drainage facilities, recreational facilities, open space improvements or buffer or screen plantings.

§ 230-44 Improvements to be provided by applicant.

A. In all cases, the subdivider or land developer shall be responsible for the installation of all improvements required by this chapter.

B. Inspection.

(1) The Township Engineer or the Township's designee shall make such inspections of the required improvements at such intervals as may be reasonably necessary to assure compliance with this chapter.

(2) The reasonable costs of such inspection shall be borne by the subdivider or land developer, and held in an escrow account.

§ 230-45 Development agreement.

A. Development agreement required.

(1) All applicants proposing any subdivision or land development which provides for the installation of improvements required by this chapter or any improvements or amenities which appear on the plan shall be required to enter into a legally binding development agreement with the Township prior to recording of the approved final plan.

(2) The development agreement shall guarantee the installation of said improvements in strict accordance with all Township requirements.

(3) The final plan shall not be recorded nor signed by representatives of the Commission or the Board of Commissioners until the development agreement is executed and the performance guarantee is in place.

B. Terms of development agreement. The development agreement shall be in the manner and form approved by the Township Solicitor and it shall consist of the following terms, where applicable:

(1) Construction:

(a) The construction depicted upon the approved plans in itemized format.

(b) Construction of streets with related curbs, street signs, drainage facilities and related improvements.

(c) Installation of utility lines.

(2) Schedules:

(a) A work schedule setting forth the beginning and ending dates and such other details as the Township deems fit and appropriate for the improvements covered by the development agreement; and

(b) An inspection schedule subject to the approval of the Township Engineer.

(3) Improvements; guarantee:

(a) The provision of a performance guarantee for completion of required improvements which complies with § 230-46.

(b) A detailed breakdown of the estimated cost of the improvements, estimated within the requirements of the Pennsylvania Municipalities Planning Code, as amended.[1]

[1] Editor's Note: See 53 P.S. § 10101 et seq.

(c) The amount of the performance guarantee.

(d) All improvements subject to the development agreement shall be approved according to the approved inspection schedule and § 230-46.

(4) Safeguards:

(a) Developer's responsibilities for damage to other property.

(b) Developer shall secure or maintain public liability insurance for the duration of improvements construction. A copy (of other evidence of coverage) shall be submitted to the Township.

(c) A save harmless clause to protect the Township from liability.

(d) Prevention of erosion, sedimentation and water damage to the subject and adjacent properties.

(5) Provisions for any future dedication or transfer of streets, water and sewer lines and easements.

(6) The developer shall provide the Township with a set of reproducible record plans prepared by and certified to by a professional engineer.

(7) The developer shall be responsible for all reasonable engineering and legal costs and expenses for review, inspection, consultations and preparation of agreements.

(8) Provisions for violation of the development agreement.

(9) Any other lawful terms which the Board of Commissioners may require to carry out the provisions of this chapter.

(10) Signatures. The development agreement shall be signed by all landowners and/or developers.

C. Ownership of land and guarantee.

(1) A certificate of ownership in the form of Appendix C.2[2] shall be executed in the exact name in which title is held. If the developer(s) of a subdivision is someone other than the landowner(s) of the subdivision, the developer shall also execute the affidavit given above, along with a performance bond and security agreements.

[2] Editor's Note: Appendix C is on file in the Township offices.

(2) Change in ownership or developer. Any conveyance of all or substantially all of the unimproved lots or public improvements or roads of any subdivision or change in developers, whether voluntary or by action of law or otherwise, shall require the prior approval of the Board of Commissioners. In giving or denying said approval, the Commissioners shall determine whether the proposed new landowner and/or developer will be financially able to fully carry out the subdivision with all required public improvements, and before giving final approval, the Board shall require the posting of appropriate bonds and security agreements.

§ 230-46 Performance guarantee.

[Amended 3-6-1995 by Ord. No. 1-95]

The performance guarantee for completion of required improvements shall meet the following requirements:

A. Security.

(1) The guarantee shall be secured by the credit of any of the following:

(a) An irrevocable and unconditional letter of credit of a federal- or state-chartered lending institution,

(b) A restrictive or escrow account in a federal- or state-chartered lending institution, or

(c) Such other financial security approved by the Board of Commissioners (which approval shall not be unreasonably withheld).

(2) Such bond, or other security shall provide for, and secure to the public, the completion of any improvements which may be required within one year of the date fixed in the development schedule for the completion of such improvements.[1]

[1] Editor's Note: Amended at time of adoption of Code (see Ch. 1, General Provisions, Art. I).

(3) Such financial security shall be posted with a bonding company or federal- or state-chartered lending institution the party posting the financial security, provided said company or lending institution is authorized to conduct such business within the state.

(a) The Board of Commissioners may require that evidence be provided that such institution or company has sufficiently adequate and secure assets to cover the security.

(b) The Township shall be an authorized signatory on any account in which the escrow funds are held and all escrow funds from sales of lots shall be paid directly to such fund, and a monthly statement shall be furnished to the Township.

B. Amount.

(1) The amount of financial security to be posted for the completion of the required improvements shall be equal to 110% of the cost of completion estimated as of 90 days following the date scheduled for completion by the developer in the official development schedule, and within the process for increases to cover inflation as permitted by the State Planning Code.[2]^,[3]

[2] Editor's Note: See 53 P.S. § 10101 et seq.

[3] Editor's Note: Amended at time of adoption of Code (see Ch. 1, General Provisions, Art. I).

(2) The cost of the improvements shall be established by an estimate prepared by a Pennsylvania registered professional engineer, within the arbitration process permitted by the State Planning Code.

(3) If the party posting the financial security requires more than one year from the date of posting of the financial security to complete the required improvements, the amount of financial security shall be increased by an additional 10% for each one-year period beyond the first anniversary date from posting of financial security or to an amount not exceeding 110% of the cost of completing the required improvements as reestablished on or about the expiration of the preceding one-year period by using the above bidding procedure.

(4) The basis of the cost of improvements shall be the estimated cost of improvement installed in accordance with the approved plan. In the case of streetlights, the developer shall estimate the cost of constructing the streetlighting, and the annual cost of lighting based upon the electric utility's fee schedule. The security shall include the cost of construction of streetlighting, and the cost of electricity for streetlighting for a period of two years. The developer shall be responsible for the cost of electricity for streetlighting until the date of acceptance of the improvements by the Township. Upon acceptance of the improvements by the Township, the developer shall pay to the Township the cost of electricity for streetlighting for the two-year period following the date of acceptance.

C. Multiyear or multistage development. In the case where development is projected over a period of years, the Board of Commissioners may authorize submission of final plats by section or stages of development subject to such requirements or guarantees as to improvements in future sections or stages of development as it finds essential for the protection of any finally approved section of the development.

§ 230-47 Approval of improvements.

A. In general. As the work of installing the required improvements proceeds, the party posting the financial security may request the Board of Commissioners to release or authorize the release, from time to time, such portions of the financial security necessary for payment to the contractor(s) performing the work.

B. Notice of completion. When the developer has completed an improvement, the developer shall notify the Board of Commissioners in writing by certified or registered mail of such completion and request for release and shall send a copy thereof to the Township Engineer.

C. Engineer's report.

(1) Within 30 days of the receipt of such request, the Township Engineer shall submit a written report certifying which improvements have been completed in accordance with the approved plan to the Board of Commissioners and mail a copy of such report by certified or registered mail to the developer at his last known address.

(2) This report shall be based on the inspections made according to the approved inspection schedule included in the development agreement and shall recommend approval or rejection of the improvements, either in whole or in part.

(3) If the Engineer finds any or all of the improvements to be not as required, he shall include a statement of the reasons for recommending their rejection in the report.

D. Decision by Board of Commissioners.

(1) At its first regularly scheduled meeting after receiving the Engineer's report (but not later than 45 days of the receipt of the request) the Board of Commissioners shall review the Engineer's report and shall authorize release of an amount as estimated by the Township Engineer fairly representing the value of the improvements completed.

(2) The Board of Commissioners shall be deemed to have approved the release of funds as requested if the Board of Commissioners fails to act within 45 days of receipt of the developer's request.

(3) Until final release (completion of all improvements), the Board of Commissioners may require retention of 10% of the cost of each completed improvement.

(4) The Board of Commissioners shall notify the developer in writing by certified or registered mail of the decision.

E. Completion of unapproved improvements. The developer shall proceed to complete any improvements not approved by the Board of Commissioners and, upon completion, request approval in conformance with the procedures specified in this § 230-47.

F. Final release.

(1) When the developer has completed all of the necessary and appropriate improvements, the developer shall request final release in conformance with the procedures specified in this § 230-47. See time limitations and procedures in Section 510 of the Municipalities Planning Code.[1]

[1] Editor's Note: See 53 P.S. § 10510.

(2) Such final release shall include all moneys retained under Subsection D(3) hereof.

G. Appeal. Nothing herein, however, shall be construed in limitation of the developer's right to contest or question by legal proceedings or otherwise, any determination of the Board of Commissioners or the Township Engineer.

H. Building permits and paving of street.

(1) At any point in time, a maximum of 10 building permits may have been issued for dwellings within all stages of a subdivision or land development for building locations that do not have acceptable vehicular access by a street, access drive or driveway as approved in the official plan to and from an existing public street. Acceptable vehicular access shall mean a cartways that is in a mud-free and permanently passable condition and with at least a binder base course and curbing (if required) in place.

I. Certificates of occupancy and completion of improvements.

(1) No temporary certificate of occupancy shall be issued for any structure on a lot adjoining a dedicated road in a subdivision until the structure is safe and substantially completed in conformity to all applicable ordinances, laws and plans with service by electricity end telephone service and any required water, fire hydrants and sewage service and access to the structure to a public clearly permanently passable street with at least a paving base course and any required curbing installed.

(2) No final certificate of occupancy shall be issued until the structure is completed as aforesaid with service by all utilities and access on a street completed to required standards.

§ 230-48 Remedies to effect completion of improvements.

A. Enforcement of security.

(1) In the event that any improvements which may be required have not been installed as provided in this chapter or in accord with the approved final plan, or in the event of the bankruptcy of the owner or developer, the Board of Commissioners is hereby granted the power to elect to enforce any corporate bond (or other security) by appropriate legal and equitable remedies.

(2) This may include taking all actions necessary to obtain moneys under said bond, including but not limited to seizure of undeveloped lots, confession of judgment, suit on the bond, seizure of escrow funds, revocation of building permits and prosecution under this chapter.

(3) Rate of construction. Failure of a developer to construct streets and other public improvements reasonably at the same time or prior to the construction of the buildings served by those streets or public improvements, and at the same rate in time at which buildings are completed, shall be a violation of this chapter and a cause for default.

B. Completion by Township. If the proceeds of such bond or other security are insufficient to pay the cost of installing or making repairs or corrections to all the improvements covered by said security, the Board of Commissioners may, at its option, install part of such improvements in all or part of the subdivision or land development and may institute appropriate legal or equitable action to recover the moneys necessary to complete the remainder of the improvements.

C. Proceeds for installation of improvements. All of the proceeds, whether resulting from the security or from any legal or equitable action brought against the developer, or both, shall be used solely for the installation of the improvements covered by such security, and not for any other Township purpose.

§ 230-49 Maintenance agreement.

A. Maintenance agreement required.

(1) All applicants proposing any subdivision or land development which provides for the dedication of improvements required by this chapter or any improvements or amenities which appear on the plan shall be required to enter into a legally binding maintenance agreement with the Township prior to acceptance of dedication by the Township.

(2) The dedication of any improvement shall not be accepted by the Township prior to the execution of a maintenance agreement and the delivery of the maintenance guarantee.

B. Terms of maintenance agreement.

(1) The maintenance agreement shall be in the manner and form approved by the Township Solicitor.

(2) The maintenance agreement shall require the applicant to make any repair or reconstruction of any improvement stipulated in the maintenance agreement which is specified by the Board of Commissioners as necessary by reason of faulty construction, workmanship, or materials prior to acceptance of such improvement by the Township.

(3) The maintenance agreement shall require the applicant to maintain at his own cost all improvements stipulated in the maintenance agreement. This period shall not exceed 18 months from the date of acceptance or dedication by the Township, except for any special purpose escrow or maintenance agreement required by the Township.

(4) The maintenance agreement shall require the posting of financial security to secure structural integrity of said improvements as well as the functioning of said improvements in accordance with the design and specifications as depicted on the final plat for a term not to exceed 18 months from the date of acceptance of dedication.

(5) Snowplowing. It shall be the responsibility of the developer to plow snow and maintain all streets until such time as the Township may accept such streets.

C. Public utilities and authorities. If water mains or sanitary sewer lines, or both, along with apparatus or facilities related thereto, are to be installed under the jurisdiction and pursuant to the rules and regulations of a public utility or municipal authority separate and distinct from the Township, financial security to assure proper completion and maintenance thereof shall be posted in accordance with the regulations of the controlling public utility or municipal authority and shall not be included within the financial security as otherwise required by this section.

§ 230-50 Maintenance guarantee.

A. Security. The maintenance guarantee shall be secured by the credit of any of the following:

(1) An irrevocable and unconditional letter of credit of a federal- or state-chartered lending institution,

(2) A restrictive or escrow account in a federal- or state-chartered lending institution, or

(3) Such other financial security approved by the Board of Commissioners (which approval shall not be unreasonably withheld).

B. Terms. Such maintenance guarantee shall be in the form approved by the Township Solicitor and Commissioners, payable to the Township, to guarantee the maintenance and repair of the streets and other improvements in the subdivision for 18 months from the date of acceptance thereof by the Township.

C. Amount. The amount of the maintenance guarantee shall be determined by the Township, but shall not exceed 15% of the actual cost of installation of such improvements.

D. Release. After the expiration of 18 months from the date of acceptance of said improvements, the Township shall release said maintenance guarantee to the developer (or party posting said maintenance guarantee) if all improvements are in satisfactory condition.