Chapter 16.26 — IMPROVEMENT SECURITY

Any improvement agreement, contract or act required or authorized by the Subdivision Map Act, for which security is required, shall be secured in the manner provided for in Section 66499 et seq., of the California Government Code. The City Attorney shall review and approve the form of all security required under this title and the City improvement standards. (Ord. 2006-03 § 2)

The improvement security shall be in the amount set forth in the City Improvement Standards. When the improvement security is other than a bond or bonds furnished by duly authorized corporate surety, an additional amount shall be included as determined by the City Council as necessary to cover the cost and reasonable expenses and fees, including reasonable attorney's fees, that may be incurred by the City in successfully enforcing the obligation secured. (Ord. 2006-03 § 2)

When required subdivision improvements are financed and installed pursuant to special assessment proceedings, the subdivider may apply to the City Council for a reduction in the amount of the improvement security required under this chapter to an amount corresponding to the amount of faithful performance and labor and material bonds required by the special assessment act being used. The City Council may grant such reduction if it finds that such bonds have been in fact provided and that the obligations secured thereby are substantially equivalent to those required by this title. (Ord. 2006-03 § 2)

Security given for the faithful performance of any act or agreement shall be released upon the final completion and acceptance of the act or work, subject to the following:

• A. The City Administrator may release a portion of the security in conjunction with the acceptance of the performance of the act or work as it progresses, upon application by the subdivider and approval of the City Engineer; provided, however, that no such release shall be for an amount less than 15% of the total improvement security given for faithful performance of the act or work, and that the security shall not be reduced to an amount less than 25% of the total improvement security given for faithful performance until final completion and acceptance of the act or work. In no event shall the City Engineer approve a release of the improvement security that would reduce such security to an amount below that required to guarantee the completion of the act or work and any other obligation imposed by this title, the Subdivision Map Act, or the improvement agreement.

• B. Security securing the payment to the contractor, his or her subcontractors and to persons furnishing labor, materials, or equipment may, after passage of the time within which claims of lien are required to be recorded pursuant to Article 3 (commencing with Section 3114) of Chapter 2 of Title 15 of Part 4 of Division 3 of the Civil Code, and after

• acceptance of the work, be reduced to an amount not less than the total claimed by all claimants for whom claims of lien have been recorded and notice thereof given in writing to the City Council, and if no such claims have been recorded, the security may be released in full.

• C. No security given for the guarantee or warranty of work shall be released until the warranty period has expired and the guarantee is released by resolution of the City Council.

• (Ord. 2006-03 § 2)