Carpinteria Municipal Code Ch. 2.17 Bonds and Improvement Securities

The purpose of this chapter is to provide direction and policy to the city with respect to the form, type and other conditions relating to bonds required by this code to provide a guarantee of performance to the city by those required to provide such guarantee.

(Ord. 297 § 1 (part), 1981)

As used in this chapter, "bonds" means and includes the following definitions:

A. "Cash bond" means a cash deposit, letter of credit, bank deposit or other negotiable instrument delivered to the city, in a form approved by the city attorney, made payable to the city, which does not require the consent nor approval of any other person for the city to draw upon and convert to cash.

B. "Cash deposit" means cash physically deposited in the treasury of the city.

C. "Surety bond" means a bond or bonds by one or more duly authorized corporate surety companies on a form approved by the city attorney, or any other bond requiring consent or approval of another person before the city can draw upon the same or convert to cash.

(Ord. 297 § 1 (part), 1981)

Unless otherwise provided in this code or by state law, bonds posted to guarantee performance of an obligation other than when a cash deposit is required shall be a combination of a cash bond and surety bond, as determined by the city manager, pursuant to this chapter, and approved as to form by the city attorney.

(Ord. 297 § 1 (part), 1981)

The amount of bonds to be posted shall be in an amount determined by the city manager on the advice of the city engineer based on one hundred percent of the estimated cost of the obligations for which a bond is required. Bonds for developments with eight units or less shall be based on one hundred percent of the engineer's cost estimate for public improvements and on-site grading and based on fifty percent of the engineer's cost estimate for all other improvements. Ten percent of the total bond amount or thirty-five thousand dollars, whichever is less shall be in a cash bond, and the balance of the total bond may be in an approved surety bonds or additional cash bond.

(Ord. 297 § 1 (part), 1981)

(Ord. No. 701, § 2, 4-27-2015)

All bonds shall be accompanied by an agreement specifying the terms, conditions, and provisions of the obligation to be performed and, where applicable, shall describe the real property that is subject to the agreement. Each such agreement for which a bond is posted shall be deemed to incorporate therein by reference, as if it were set forth in full, each and every condition, provision, or obligation contained in any final approval by the city and the provisions of all permits granted by the city, whether they are set forth in the agreement or not. Such agreement shall be approved as to form by the city attorney. Subdivision surety bonds shall follow the form set forth in Government Code Section 66499, et seq. No employee or officer of the city, unless expressly authorized to do so, shall be permitted to waive or disregard any binding resolution, term, provision, or condition of approval, whether imposed by ordinance, resolution of the city council, or by act of the city council or planning commission.

(Ord. 297 § 1 (part), 1981)

All bonds shall be for a term sufficient to cover the obligation until such obligation is finally and fully completed and accepted by the city. In the case of landscape bonds, such bonds shall be for a term of not less than three years.

(Ord. 297 § 1 (part), 1981)

In the event that special conditions arise in which an obligor, due to extenuating circumstances, is unable to meet all conditions of approval of a project, but in the judgment of the city manager will do so within a reasonable period of time, the city manager is authorized to establish an amount sufficient to guarantee the obligor's party's performance and to require the deposit of said amount by cash deposit with the city prior to issuing any temporary waiver to the applicant. An agreement for the same shall be prepared and executed pursuant to Section 2.17.050.

(Ord. 297 § 1 (part), 1981)

Where it is in the best interests of the city to delay construction of required improvements, the city manager may require a cash deposit for said improvements. Such cash deposit shall be deposited in a restricted fund of the city and held until such time the improvement if constructed.

(Ord. 297 § 1 (part), 1981)

Unless provided otherwise in this code, waivers and/or exemptions from the provision of this chapter shall be only given upon application and/or the express affirmative action of the city council. Public utilities operating under a franchise from a city and public agencies with services in the streets shall be exempt from the cash bond requirement providing an agreement in writing delineating responsibility for and timing of restoration and repair of street surfaces damaged or disturbed as a result of installation, relocation maintenance or other work done by them on, in or under the streets has been executed and accepted by the city council.

(Ord. 334 § 1, 1982: Ord. 297 § 1 (part), 1981)

All cash deposits shall bear interest at a rate generally prevailing on standard passbook savings accounts in commercial banks. Interest shall not accrue on cash deposits held less than six (6) calendar months and shall be credited to the cash deposit only on January 2nd and July 2nd of each calendar year. The determination of the city manager with respect to the accrual and payment of interest under this section shall be final. All accrued interest shall be held with the bond and shall be used for the same purpose. Upon release of the cash deposit, the city shall return the cash deposit to the depositor with interest as calculated pursuant to this section, less any deductions and payments made therefrom.

(Ord. 297 § 1 (part), 1981)

Bonds may be partially released from time to time by the city council or by the city manager when the bond amount is one hundred thousand dollars or less, upon recommendation of the city engineer or city manager, as the case may be. No bond shall be fully released until the purpose for which the bond has been proposed has been completely fulfilled and any obligation performed in connection therewith has been accepted by the city council or the city manager.

(Ord. 297 § 1 (part), 1981)

(Ord. No. 701, § 3, 4-27-2015)

Except as otherwise may be specified in the agreement or bond, in the event that a default occurs or the obligation is not performed to the satisfaction of the city, the city manager shall immediately notify the bonded party and bonding or surety company, if any, and prescribe a time limit within which the work is to be accomplished. The giving of such notice shall not relieve the principal obligor, the bonded party, nor the bonding or surety company from fully and satisfactorily completing the obligation in a timely manner, nor shall the failure to give such notice prevent the city from immediately enforcing the obligations of the principal obligor or any surety.

(Ord. 297 § 1 (part), 1981)