Skip to main content
Loading…
This section is included in your selections.

(1) This Section contains provisions for performance bonds, which shall apply to all land development which is subject to regulation by Provo City:

(a) Bonding shall be required for any street improvements that must be installed at the time of development approval or with the issuance of a building permit.

(i) Bonding for street improvements shall be established by the City Engineer or the City Engineer’s designee.

(ii) All other bonding relating to site development such as landscaping, driveway installation, early occupancy and similar matters shall be established by the Development Services Department.

(b) A bond shall be posted with Provo City in a principal amount of one hundred fifteen percent (115%) of the total estimated cost of any performance which is promised to the City.

(i) The estimated cost for street improvements shall be based on the average cost paid by the City for the same type of performance.

(ii) The estimated cost of other improvements shall be based on a review of actual bids for the improvement, except as follows:

(A) Where landscaping is required, one dollar and fifty cents ($1.50) per square foot shall be required unless the developer submits at least two (2) bids from landscaping companies to be considered.

(B) For all new one-family residential units, an improvement protection bond in the amount of one thousand dollars ($1,000) shall be required to be paid at the issuance of said building permit; except where a grading bond is required, an additional two thousand dollars ($2,000) bond shall be required.

(iii) If when the bond is first posted, or at any time thereafter, it is foreseeable that the promised performance will take more than one (1) year to perform, the principal amount of the bond shall be increased by not less than ten percent (10%) for each additional year of performance. The original bond amount shall be adjusted to conform with the increased bond amount. A bond may be extended only if special circumstances warrant an extension, as determined by the City.

(c) The bond shall be in the form of cash or an irrevocable letter of credit, except that the Mayor or the Mayor’s designee may upon a finding of good cause, in the Mayor’s discretion, waive or modify performance bond requirements.

(i) A minimum of fifteen percent (15%) of the bond or twenty thousand dollars ($20,000.00), whichever is greater, shall be posted in the form of cash. If the bond is less than twenty thousand dollars ($20,000.00), the entire bond shall be posted in the form of cash.

(ii) When the bond is in the form of an irrevocable letter of credit, the letter shall include a provision that the bond shall expire within one (1) year from the date issued and if the project has not been completed by that date, then the bond shall automatically be considered foreclosed upon. All remaining funds shall be thereafter remitted to the City as set forth in the bonding agreement.

(d) The terms of the bond shall give the City the unqualified right, after default, to receive any part of the bond which is necessary to complete the promised performance or to repair any inadequate performance.

(e) The bond, by its terms, shall not expire until an authorized representative of the City has certified in writing that the promised performance is completed.

(f) The City shall have the sole right to enforce the bond. Private parties shall not be deemed third-party beneficiaries of the bond.

(g) A bond may be partially released if the performance to which it relates has been satisfactorily completed, provided that beyond work completed, fifteen percent (15%) of the bond may be retained to insure completion of the entire performance.

(i) The cash portion of any bond shall be the last monies released.

(ii) A service charge in an amount not exceeding one-hundred dollars ($100.00) may be charged to cover the actual cost of processing partial bond releases.

(2) The Mayor or the Mayor’s designee may establish procedures consistent with this Section relating to the administration of performance bonds, including but not limited to fund management, default and collection.

(Rep&ReEn 1999-34, Am 2000-48, Am 2006-50, Am 2020-57)