[HISTORY: Adopted by the Town of Falmouth Annual Fall Town Meeting 9-14-2020, Art. 26, approved 3-22-2021. Amendments noted where applicable.]
The purpose of this Bylaw is to provide a mechanism for the application by Town officers, boards, committees and commissions of security posted by applicants in connection with their obtaining licenses, permits, approvals, authorizations and contracts. This Bylaw is adopted pursuant to the home rule authority of the Town and the authority conferred by G.L. c. 44, § 53G1/2.
It is the intent of this Bylaw to govern as broad a range of situations as possible in which Town officers, boards, committees and commissions require some form of security from applicants, provided only that this Bylaw shall not apply to deposits or other financial surety received under G.L. c. 41, § 81U. Without limiting the generality of the foregoing, this Bylaw shall apply to surety required by (a) the Board of Selectmen to secure performance under any contract which such board is authorized to execute by general or special law or by any of the General Bylaws; (b) the Board of Selectmen to secure performance of any condition for the issuance by such board of any license, permit or approval including, without limitation, a street opening permit or drain connection permit; and (c) the Conservation Commission to secure performance of any obligation undertaken by an applicant for an order of conditions or other approval granted by such commission.
Subject to any restrictions set forth in any authorizing statute or Bylaw, Town officers, boards, committees and commissions may require, accept, hold and apply security in any reasonable form including, but not limited to, a deposit of money or negotiable securities, a bond issued by a bonding company authorized to do business within the Commonwealth of Massachusetts, a letter of credit, and a so-called 'tri-partite' agreement of the kind described in G.L. c. 41, § 81U(4).
Any deposit of money hereunder shall be held by the Treasurer in a special account established specifically for such purpose, separate and apart from all other funds. Any negotiable securities, bonds, letters of credit and so-called 'tri-partite' agreements shall also be held by the Treasurer, and any funds generated from such surety shall likewise be deposited in such a special account. Any such account shall be an interest-bearing account with a Massachusetts bank. All interest accruing on each such account shall be added to the principal of such account for disposition as set forth herein.
Any Town officer, board, committee or commission demanding surety from any applicant hereunder shall be responsible for determining, in the exercise of his or its reasonable discretion and in good faith, the extent, quality and adequacy of any work done by such applicant or performance by such applicant of the obligation for which such surety was given. Such officer, board, committee or commission may, but need not, reduce the amount of surety held upon proof of satisfactory partial work or performance by such applicant, provided that nothing herein shall require that such reduction be commensurate with the extent of such performance.
If and when such Town officer, board, committee or commission determines that such applicant has fully and satisfactorily completed all work and performed all obligations for which such surety was given, such surety shall be released and returned to the applicant, including any accrued interest.
If any Town officer, board, committee or commission which has received surety for work or for the performance of any obligation hereunder determines at any time that the applicant who posted such security is in default of his, her or its obligations (whether because of a failure to complete such work or performance by a designated deadline, or the unsatisfactory quality of such applicant's work or performance, or otherwise), such officer, board, committee or commission may declare such applicant in default.
Upon a declaration of default, such officer, board, committee or commission shall be entitled to apply any and all surety posted by such applicant (including any interest received thereon) to the completion of the work or the performance of the obligations for which such surety was posted. Without limiting the generality of the foregoing, such officer, board, committee or commission may take any and all actions necessary or appropriate to enforce any bond, make demand on any issuer of a letter of credit, and demand payment under any so-called 'tri-partite' agreement, and any money received as a result thereof shall be deposited in an account held by the Treasurer under § 60-3B, above. Monies in such special account may be expended by such officer, board, committee or commission, without further appropriation, to complete the work or perform the obligations which such applicant was obliged to do or perform. Any monies remaining in such account after all work has been done and all obligations performed to the full satisfaction of such officer, board, committee or commission shall be returned to the applicant, including any accrued interest.
At any time, and from time to time, an applicant whose surety is being held by the Treasurer on behalf of a Town officer, board, committee or commission may give written notice to such officer, board, committee or commission that in such applicant's opinion the work or performance that such surety was intended to secure has been fully and satisfactorily completed. Such notice shall contain a demand for the return of surety and the full name and address of the applicant. If such officer, board, committee or commission determined that such work or performance has been fully and satisfactorily completed, then he, she or it shall release the surety, or so much of it as may then remain, including any accrued interest, as set forth in § 60-4B, above. If such officer, board, committee or commission determines that such work or performance has not been fully and satisfactorily completed, then he, she or it shall specify in a written notice to the applicant the details wherein such work or performance remains incomplete or unsatisfactory within forty-five (45) days after the receipt by such officer, board, committee or commission of the said notice and demand from the applicant. In the event that such forty-five- (45) day period expires without such specification, then the applicant shall be entitled to the return of all surety then remaining, including any accrued interest. Any notice under this Bylaw by an applicant to a Town officer, board, committee or commission shall be given by certified mail, return receipt requested, or by hand delivery with a signed receipt, and shall not otherwise be effective.
§ 6B "Disapproved by Attorney General March 22, 2021"
If any term, condition or provision set forth in this Bylaw should be found by a court of competent jurisdiction to be illegal, invalid or unenforceable as applied under particular circumstances, such term, condition or provision shall not be deemed stricken from this Bylaw but rather shall be, to the greatest extent possible, deemed applicable only to such circumstances as will not support a finding of such illegality, invalidity or unenforceability. The illegality, invalidity or unenforceability of any term, condition or provision of this Bylaw shall not affect the legality, validity or enforceability of any other term, condition or provision of this Bylaw.