The acceptable forms of financial security are as follows:
A. Surety performance bond. A security bond from a surety bonding company
authorized to do business in the Commonwealth of Pennsylvania. The
bond will be payable to the Borough of Lewisburg and will be in a
form satisfactory to Borough Council.
B. Escrow account. A deposit of cash with the Borough held in escrow
with a federal or commonwealth chartered financial institution. In
the case of an escrow account, the applicant or developer will file
with Borough Council an agreement between the financial institution
and the applicant or developer guaranteeing the following:
(1) That the funds of the escrow account will be held in trust until
released by the Borough and may not be used or pledged by the developer
as security in any other matter during that period.
(2) In the case of a failure on the part of the developer to complete
the said improvements, the institution will immediately make the funds
available to the Borough for use in the completion of those improvements.
(3) Withdrawals from the account to pay for completed improvements will be pursuant to §
315-69.
C. Letter of credit. An irrevocable commercial letter of credit provided
by the applicant and/or developer from a federal or commonwealth chartered
financial institution. This letter will be deposited with the Borough
and will certify the following:
(2) In the case of failure on the part of the developer to complete the
specified improvements within a time period specified in a written
agreement between the Borough and the developer, the creditor will
pay to the Borough such funds as are necessary to finance the completion
of those improvements, up to the limit of credit stated in the letter.
(3) The letter of credit is irrevocable and may not be withdrawn, or
reduced in amount, until released or partially reduced by the Borough.
D. Certified check. A certified check payable to the Borough drawn on
a federal or commonwealth chartered financial institution.
E. Other forms of security. Any other form of guarantee acceptable to
Borough Council.
As the work of installing the required improvements proceeds,
the party posting the financial security may request Borough Council
to release or authorize the release, from time to time, such portions
of the financial security as are necessary for payment to the contractor
or contractors performing the work. Any such requests will be made
in writing addressed to Borough Council, and Borough Council will
have 45 days from receipt of such request to allow the Borough Engineer
to certify, in writing, that a portion of the work upon the improvements
has been completed in accordance with the approved plan. Upon certification
Borough Council will authorize release by the bonding company or lending
institution of an amount estimated by the Borough Engineer to be the
value of the improvements completed. If Borough Council fails to act
within the 45 day period. Borough Council will be deemed to have approved
the release of funds as requested. Borough Council may, prior to final
release at the time of completion and certification by the Borough
Engineer, require retention of 10% of the estimated cost of aforesaid
improvements.