DEVELOPMENT STANDARDS SECTION 9 – BONDING STANDARDS 3 BONDING AND LIABILITY INSURANCE Developers or Developer’s Contractor constructing infrastructure facilities within existing public rights-of-way shall provide performance and maintenance bonds, subject to the requirements specified herein, in the form of one of the following bonding mechanisms; a surety bond, cash at bank, or certified check , or Cash Deposited with the City in a sufficient amount as verified by the City Engineer, to assure construction of required improvements, correction of project deficiencies and/or elimination of hazards relating to the project, maintenance of such improvements and protection of public property. Please refer to the end of this section for samples of the above mentioned bonding methods. Please note, bonding types, forms, and language is subject to the City Engineer's approval, as amendments may be required to suit particular issue, bonding/lending company requirements or City requirements. METHODS TO SECURE PERFORMANCE AND MAINTENANCE BONDS Performance, maintenance, and other bonds (subject to City approval) may be secured by one of the following mechanisms: 1. Surety Bond 2. Cash at Bank (accepted in the form of savings or CD accounts) 3. Letter of Credit (If language can be approved by City Engineer and Lending Agency) 4. Loan 5. Certified Check 6. Cash Deposit to City of Ellensburg PERFORMANCE AND PAYMENT BOND A performance bond shall be provided to the City in the amount of 125% of the estimated completion cost of the improvement. The performance bond cost shall be prepared by the Developer’s professional engineer or by the City if minor design has been completed by the City. Prior to commencing construction, the developer constructing the facility shall post a performance bond subject to the requirements specified herein, in the form of one of the following bonding mechanisms; a surety bond, cash at bank, letter of credit, loan, or certified check , or Cash Deposited with the City in a sufficient amount as verified by the City Engineer, to assure construction of required improvements, correction of project deficiencies and/or elimination of hazards relating to the project, maintenance of such improvements and protection of public property. The instructions to the City shall provide that after ten days prior written notice to the developer and the developer’s failure to correct project deficiencies and/or eliminate existing or potential hazardous conditions in a timely manner, the City shall be authorized without any further notice to the developer and without any further consent of the developer to disburse the necessary funds to the City for the purpose of completing, correcting and/or eliminating such conditions as specified in the City notice. After determination by the City Engineer that all infrastructure facilities are constructed in compliance with the approved plans, and that the maintenance bond provided for herein has been posted, the performance bond will be released. In the event the developer fails to complete all improvements in accordance with the Ellensburg Municipal Code and the City completes the same, the City shall call upon the performance bond as required herein, for reimbursement or shall appropriate from any cash deposit or bonding mechanism posted, funds for reimbursement. In the event the amount of security bond or cash deposit shall exceed all costs and expenses incurred by the City, it shall release the remainder of such bond or deposit, and if the amount of the security bond or deposit is less than the cost of expense incurred by the City, the developer shall be liable to the City and shall immediately pay for such difference upon notice from the City.
