[Amended 8-5-2025 by Ord. No. 25-82]
A. 
Purpose. Improvement guarantees shall be provided to ensure that the applicant has the financial capability to properly install and maintain the required street, utility and other improvements.
B. 
Types of guarantees. The applicant shall provide one of the following performance guarantees for an amount adequate to cover 125% of the total construction costs of all required improvements. Performance and maintenance guarantees shall be provided by a variety of means, including, but not limited to, the following, which must be approved as to form and enforceability by the Town Manager and Town Attorney:
(1) 
Escrow account, as set forth in Subsection D below.
(2) 
Performance bond, as set forth in Subsection E below.
(3) 
Letter of credit, as set forth in Subsection F below.
C. 
Contents of guarantee. The performance guarantee must contain the following:
(1) 
Construction schedule; and
(2) 
Cost estimates for each phase of construction, taking into account as-built drawings, survey monumentation, required legal documents, provisions for inspections of each phase of construction and a date after which the applicant will be in default and the municipality shall have access to the funds to finish construction.
D. 
Escrow account. A cash contribution for the establishment of an escrow account must be made by either a certified check made out to the Town of Gorham, the direct deposit into a savings account or the purchase of a certificate of deposit.
(1) 
For any account opened by the applicant, the Town of Gorham must be named as owner or co-owner, and the consent of the Town must be required for any withdrawal.
(2) 
The Town shall be authorized to make withdrawals without the signature of the applicant, pursuant to the performance schedule.
E. 
Performance bond. A performance bond must detail the conditions of the bond, the method for release of the bond or portions of the bond to the applicant, and the procedures for collection by the municipality.
(1) 
The bond documents must specifically reference the subdivision for which approval is sought and the approved cost estimates.
(2) 
The applicant shall submit a draft copy of the performance bond to the Town Planner for review and approval prior to issuance of the final performance bond.
F. 
Letter of credit.
(1) 
An irrevocable letter of credit from a bank or other reputable lending institution with offices in the region must indicate that funds have been set aside for the construction of the subdivision.
(2) 
The letter of credit must use the template established by the Town of Gorham, unless waived by the Town Manager in consultation with the Town Attorney.
G. 
Phasing of development. The Planning Board may approve plans to develop a subdivision in separate and distinct phases. If the subdivision is located in the Rural Zoning District, and the subdivision has 10 lots or more, subdivision phases shall be limited so that no more than five lots are allowed in an individual phase. For all other zones, if the subdivision has 50 lots or more, subdivision phases shall be limited so that no more than 25 lots are allowed in an individual phase. Only one phase will have building permits issued at a time until at least 90% of the certificates of occupancy have been issued for that phase and all required improvement for that phase have been completed, except for finish paving of streets. In no event shall more than two phases of the subdivision be under construction at the same time. The phases must be designed so that they can be recorded at the Registry of Deeds as separate and distinct plans. No phased plans will be released for recording at the Registry of Deeds until the performance guarantee for that phase has been established as required under this section.
H. 
Release of guarantee. While partial draws are permitted, the amount of each must be no less than 20% of the original amount. The developer shall submit to the Town Planner a copy of the approved schedule of values identifying items substantially completed and being requested for release. The Town Planner shall send a copy of such notice to the appropriate municipal officials: The Zoning Administrator, Fire Chief, Town's Inspecting Engineer, and/or the Public Works Director or the Director's designee. The respective municipal officials shall inspect all improvements for which such notice has been given and shall file a report with the Town Planner indicating either approval, partial approval or rejection. Prior to the release of any part of the performance guarantee, the Town Manager, or designee, shall determine to their satisfaction, in part upon the report of the Town's consulting engineer or other qualified individual retained by the municipality and departments who may be involved, that the proposed improvements meet or exceed the design and construction requirements for that portion or phase of the subdivision for which the release is requested.
I. 
Default. If, upon investigation, the Town or the Town's consulting engineer finds that any of the required improvements have not been constructed in general conformance with the plans and specifications filed as part of the application, they shall report in writing to the Code Enforcement Officer, the Town Manager, the Town Planner and the applicant or builder. The Town Manager, or designee, shall take any steps necessary to preserve the municipality's rights.
J. 
Performance guarantees for subdivisions containing streets designed to the Town's public way standards and meant to be offered to the Town for acceptance are subject to the provisions under Part 2, Article 2-5, Minimum Standards for the Design and Construction of Streets and Ways, § 300-2.35, Acceptance of streets and ways, Subsection D(8).
A. 
In no event shall building permits be issued for more than 50% of the lots or units within a development until:
(1) 
All required off-site public improvements have been completed, unless otherwise approved by the Planning Board, based upon the Board's determination that extenuating circumstances exist and an adequate performance guarantee is in place to ensure the completion of the uncompleted public improvements. For purposes of this section only, extenuating circumstances may include, but are not limited to, delays in related Town, state or federal improvement projects that impact the required public improvements or delays caused by weather or unforeseen site conditions. The Planning Board's decision on whether extenuating circumstances exist to excuse completion of required off-site improvements prior to the issuance of more than 50% of the building permits shall be final.
(2) 
All required streets are either constructed or the guarantee required by Part 2, Article 2-5, § 300-2.35D(3), has been posted with and accepted by the Town.
(3) 
All required stormwater facilities and erosion control measures have been installed, as required by the approved plan, other than those facilities required as part of the development of an individual lot.
B. 
Where the Planning Board has approved a phased development, this limitation shall apply to each separate phase. Public improvements both on and off site shall be assigned to a phase of development as part of the Planning Board's approval of the subdivision.