Article 14-60

IMPROVEMENT AGREEMENTS

Sections:

14-60.010 Improvement agreement. 14-60.020 Improvement security.

Prior to the commencement of any work on improvements to be accepted by the City, the owner of the subdivision shall enter into a written agreement with the City, which shall contain the following provisions:

(a) That all improvements will be constructed in accordance with the plans and specifications as previously approved by the City Engineer, and will be satisfactorily completed within one year from the date of final subdivision approval (or such other date as may be specified in the agreement).

(b) That the owner shall maintain the improvements in good condition and repair and guaranty the same against any defects in material and workmanship for a period of one year from the date of final approval by the City.

(c) That upon any failure by the owner to complete or maintain the improvements or to correct any defects therein, the City may perform any necessary construction, maintenance or corrective work and recover the full cost and expense thereof from the owner.

(d) That the owner shall pay to the City the cost of inspecting the improvements.

(e) That the owner shall furnish to the City the improvement security required by Section 14-60.020 of this Article.

(f) That the owner shall furnish to the City the indemnity agreement and insurance policy required by Section 14-05.055 of this Chapter.

(g) Such other terms, covenants, conditions or provisions as the City Council, the City Engineer or the Community Development Director may deem necessary or appropriate.

(Ord. No. 398, § 1(Att.), 12-20-2023)

(a) The subdivider shall furnish to the City good and sufficient security, in one or a combination of the

forms as authorized under Paragraph (b) of this Section, in the following amounts and for the following purposes:

(1) An amount equal to one hundred percent of the total estimated cost of the improvement or of the act to be performed, as determined by the City Engineer, securing faithful performance of the act or agreement; and

(2) An amount equal to one hundred percent of the total estimated cost of the improvement or of the act to be performed, as determined by the City Engineer, securing payment to the contractor, the subcontractors, and persons furnishing labor, materials, or equipment for the improvement or the performance of the required act.

As part of the obligation guaranteed by the security and in addition to the face amount of the security, there shall be included costs and reasonable expenses and fees, including reasonable attorneys' fees, incurred by the City in successfully enforcing the obligation secured.

(b) The security required under Paragraph (a) of this Section shall be one or a combination of the following, at the option of and subject to the approval of the City Manager:

(1) A performance bond, substantially in the form set forth in Government Code Section 66499.1, and labor and material bond, substantially in the form set forth in Government Code Section 66499.2, issued by a corporate surety duly authorized to transact business in the State.

(2) A deposit held by the City in cash or, if accepted by the City Manager, negotiable bonds of the kind approved for securing deposits of public monies.

(3) An instrument of credit from one or more financial institutions subject to regulation by the State or Federal government and pledging that the funds necessary to carry out the act or agreement are on deposit and guaranteed for payment, or a letter of credit or set aside letter issued by such a financial institution. The form and content of such instrument, letter of credit, or set aside letter shall be subject to approval by the City Attorney.

(c) The security for faithful performance required under this Section shall remain in full force and effect for a period of one year following the completion of the work as continuing security for the owner's guarantee against any defective work or labor done or defective

(Saratoga Supp. No. 53, 4-24)

274.1

14-60.020

materials furnished, and thereafter until all deficiencies in construction, maintenance and repair have been corrected to the satisfaction of the City Engineer and final acceptance of all work is granted by the City Council. Upon completion of the work, the City Engineer may, in the Engineer's discretion, permit the owner to reduce the amount of such security if the City Engineer determines that a lesser amount will be sufficient to secure the owner's obligation to correct any defects in workmanship or materials. The security required under this Section for payment to contractors, subcontractors and to persons furnishing labor, materials, or equipment shall, after final acceptance of the work and passage of the time within which claims of lien are required by law to be recorded, be reduced to an amount equal to the total claimed by all persons for whom claims of lien have been properly recorded and timely notice thereof given in writing to the City, and if no such claims have been recorded, the labor and material security shall be released in full. The reduction or release of security authorized herein shall not apply to any amount deemed by the City Manager to be necessary as security for costs, expenses and fees, including reasonable attorneys' fees, that may be incurred by the City as a result of any breach of the improvement agreement by the owner.

(d) If the required improvements are financed and installed pursuant to a special assessment proceeding and the contractor has furnished a performance bond and labor and materials bond as required by the special assessment act pursuant to which the improvements are being constructed, the improvement security required under this Article may be reduced by an amount corresponding to the amount of such bonds so furnished by the contractor.

(Ord. No. 398, § 1(Att.), 12-20-2023)

274.2

(Saratoga Supp. No. 53, 4-24)

14-65.040