Where these Regulations require subdivisions to execute an agreement with the City secured by a bond or other alternative financial guarantee, said bonds and financial guarantees shall meet the following minimum requirements:
(Ordinance 0035 adopted 1/11/94)
Bonds shall meet the following requirements:
9.2.1 
The bond or financial guarantee shall be payable to the Mayor of Horizon City, Texas, in the official capacity, or the Mayor’s successor in office.
9.2.2 
The bond or financial guarantee shall be in an amount determined by the City Council to be adequate to ensure proper construction or installation of the roads and streets, public or non-public water facilities, and wastewater facilities to service the subdivision, including reasonable contingencies. In no event shall the amount of the bond be less than the total amount needed to serve the subdivision as established by the engineer who certified the plat.
9.2.3 
The bond shall be executed with sureties as may be approved by the City Council. The City shall establish criteria for acceptability of the surety companies issuing bonds, including but not limited to:
9.2.3.1 
Registration with the Secretary of State and authorization to do business in Texas;
9.2.3.2 
Authorization to issue bonds in the amount required by the City Council; and
9.2.3.3 
Rating of at least B from Best’s Key Rating Guide; or if the surety company does not have any such rating due to the length of time it has been a surety company, the surety company must demonstrate eligibility to participate in the surety bond guarantee program of the Small Business Administration and must be an approved surety company listed in the current United States Department of Treasury Circular 570. Such bonds shall meet the criteria contained in the rules and regulation promulgated by the United States Department of Treasury.
9.2.4 
The bonds shall be conditioned upon construction or installation of roads, streets, and water and wastewater facilities meeting the criteria established by these Regulations and upon construction of facilities within the time stated on the plat, or on the document attached to the plat for the subdivision, or within any reasonable extension of time granted by the City Council.
(Ordinance 0035 adopted 1/11/94)
A Letter of Credit shall meet the following requirements:
9.3.1 
Any letter of credit submitted as a financial guarantee for combined amounts greater than $10,000 and less than $250,00 [$250,000] must be from financial institutions which meet the following qualification:
9.3.1.1 
Bank qualifications;
9.3.1.1.1 
Must be federally insured;
9.3.1.1.2 
Sheshunoff rating must be ten or better and primary capital must be at least six percent (6%) of total assets; and
9.3.1.1.3 
Total assets must be at least twenty-five million dollars.
9.3.1.2 
Savings and loan association qualifications:
9.3.1.2.1 
Must be federally insured;
9.3.1.2.2 
Tangible capital must be at least one and a half percent (1.5%) of total assets and total assets must be greater than twenty-five million dollars, or tangible capital must be at least three percent (3.0%) of total assets if total assets are less than twenty-five million dollars; and
9.3.1.2.3 
Sheshunoff rating must be thirty or better.
9.3.1.3 
Other financial institutions qualifications:
9.3.1.3.1 
The Letter of Credit must be 110% collateralized by an investment instrument that would meet the qualifications for a City investment; and
9.3.1.3.2 
The investment instrument must be registered in the City’s name and the City must receive safekeeping receipts for all collateral before the Letter of Credit is accepted.
9.3.2 
Any Letter of Credit submitted as a financial guarantee for combined amounts equal to or greater than $250,000 must be from financial institutions which meet the following qualifications:
9.3.2.1 
Bank qualifications:
9.3.2.1.1 
Must be federally insured;
9.3.2.1.2 
Sheshunoff rating must be thirty or better and primary capital must be at least seven percent (7.0%) of total assets;
9.3.2.1.3 
Total assets must be at least seventy-five million dollars.
9.3.2.2 
Savings and loan association qualifications:
9.3.2.2.1 
Must be federally insured;
9.3.2.2.2 
Tangible capital must be at least three percent (3.0%) of total assets and total assets must be greater than seventy-five million dollars, or tangible capital must be at least five percent (5.0%) of total assets if total assets are less than seventy-five million dollars; and
9.3.2.2.3 
Sheshunoff rating must be thirty or better.
9.3.2.3 
Other financial institutions qualifications:
9.3.2.3.1 
The Letter of Credit must be 110% collateralized by an investment instrument that would meet the qualifications for a City investment; and
9.3.2.3.2 
The investment instrument must be registered in the City’s name and the City must receive safekeeping receipts for all collateral before the Letter of Credit is accepted.
9.3.3 
The Letter of Credit shall list as sole beneficiary the Mayor of the City, in his official capacity, or the Mayor’s successor in office, and must be approved by the Council of the City. The form of the Letter of Credit shall be modeled after the form in Exhibit A to these Regulations.
Editor’s note–Exhibit A, referred to in section 9.3.3, is not printed herein.
9.3.4 
The Letter of Credit shall be conditioned upon installation or construction of roads, streets, and water and wastewater facilities meeting the criteria established by these Regulations and upon construction of facilities within the time stated on the plat, or on the documents attached to the plat for the subdivision, or within any reasonable extension of time granted by the City Council.
(Ordinance 0035 adopted 1/11/94)
The City will determine the amount of the bond, letter of credit, or cash deposit required to ensure proper construction of adequate water and wastewater facilities, and roads in the subdivision.
(Ordinance 0035 adopted 1/11/94)
9.5.1 
Reasonableness.
The City Council may extend, beyond the date specified on the plat or on the document attached to the plat, the date by which the required water and sewer service facilities must be fully operable if the City finds the extension is reasonable and not contrary to the public interest.
9.5.2 
Timeliness.
If the facilities are fully operable before the expiration of the extension period, the facilities are considered to have been made fully operable in a timely manner.
9.5.3 
Unreasonableness.
An extension is not reasonable if it would allow a residence in the subdivision to be inhabited without water or sewer services that meet the standards of Section 2 of these Regulations.
(Ordinance 0035 adopted 1/11/94)