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Purpose: To provide procedures for approving and posting the assurances for the completion of subdivision/development improvements in accordance with Arizona Revised Statutes, Section 9-463.01(C)(8).

A. Assurances for Construction

1. These assurances guarantee the construction of required on-site and off-site street, water, sewer, utilities, drainage, flood control measures, the hardscape for recreation facilities and landscaping, and all other required improvements. They may also be used to stabilize soil and replace vegetation on sites where development has been abandoned, in accordance with Section 26.6.J.1.

2. For all developments where there is a subdivision, minor subdivision or other division of property that requires improvements, the property owner, subdivider or developer shall provide the required assurances as specified in Section 26.6.F.1. As a substitute for all or a portion of the assurance, the Planning and Zoning Administrator or the Town Engineer or their designee may approve an assurance as specified in Section 26.6.F.

3. For all developments where division of land is not involved, assurances shall be provided for public off-site and on-site improvements and for such private improvements as are necessary for the operation of the development as deemed appropriate by the Planning and Zoning Administrator and Town Engineer. These assurances shall be provided in one of the forms specified in Section 26.6.F.

4. For projects constructed in phases, the developer shall provide cost estimates itemized separately for each phase of construction to facilitate the release of assurances upon the completion of individual phases.

5. Phased construction shall include assurances that provide for the installation of public safety-related improvements including drainage, traffic movement and other services appropriate to each phase as determined by the Town Engineer and Planning and Zoning Administrator.

(6/11 supplement, 2011.)

B. Assurances for Site Stabilization

For sites that require stabilization in accordance with Section 27.9, the property owner or their agent shall post assurances in one of the types specified in Sections 26.6.F to guarantee, in the event the project is abandoned, the property can be stabilized, through the removal of all construction material and the stabilization of soil on the site. Acceptable forms of soil stabilization include, but are not limited to, inorganic ground cover, hydroseeding and revegetation, as determined by the Town Engineer and the Planning and Zoning Administrator. Other methods may be approved by the Town

Engineer and Planning and Zoning Administrator if they are equally effective. These stabilization assurances shall be in an amount sufficient to stabilize the property from its development-altered condition. The assurances for landscape may be used to satisfy the landscape installation portion of the stabilization requirements.

(6/11 supplement, 2011.)

C. Assurances for Landscape

The property owner or their agent shall post assurances as specified in Section 26.6.F to assure the installation of all landscape improvements, and recreation areas where required, in accordance with the approved final landscape and irrigation plans. These assurances may be used to complete the required landscape improvements and/or recreation areas or may be used to stabilize the site in the event the approved development is abandoned.

D. Assurances for Water Service

1. Assurances for water infrastructure are required and are included with construction assurances as specified in Section 26.6.A.

2. Water service to any individual lot or any lot within a development or subdivision will be contingent upon the completion of all required water infrastructure along with the receipt of all required meter fees by the utility.

The only exception is prior to the completion of all required water infrastructure but after approval of construction from the Pima County Department of Environmental Quality, the property owner or their agent may receive meters for ten percent (10%) of the lots, not to exceed six (6) lots, for the purpose of model home construction.

E. Assurances for Other Improvements

To assure the completion of other required improvements, the Town may require additional assurances in the forms as specified in Sections 26.6.F. These assurances are typically utilized to allow development to proceed when other required obligations have not been met on time.

F. Amount and Type of Assurances

1. Assurances for construction, site stabilization, landscaping, water infrastructure or other improvements shall be in an amount equal to one hundred twenty percent (120%) of the costs as estimated in accordance with this Section 26.6.F.

2. For residential subdivisions a third party trust type of assurance is required in addition to monetary assurances for site stabilization, landscape, and water infrastructure.

a. Assurances shall be provided by the placement of the title to the subdivided property in trust with a third party escrow agency or trust company authorized and licensed to do business in the State of Arizona.

b. This type of assurance shall include an agreement between the trustee and the Town of Oro Valley that title to any lot or parcel within the subdivision will not be transferred until the trustee receives authorization in writing from the Town. The agreement shall also include special conditions authorizing the Town of Oro Valley to abandon and re-subdivide the property should the required improvements fail to be installed in compliance with the Town of Oro Valley’s specifications.

c. The designated escrow agency or trust company holding the property in trust may sell and convey all of the unreleased lots within the subject property or within an approved phase in one transaction to a single purchaser; provided, that such purchaser shall be bound by the terms of the agreement between the Town of Oro Valley, the subdivider and the designated escrow agency or trust.

d. The assurances and deeds required pursuant to this Section shall be recorded in the office of the Pima County Recorder. The changes to the third party trust due to the aforementioned sales, if they meet all of the above stipulations, will not require Town Council approval.

e. Third party trusts may not be used to guarantee the improvement of required recreation areas, the installation of required landscaping, site stabilization or water infrastructure.

3. Residential subdivisions utilizing a third party trust are required to post an alternative type of assurance for public safety-related subdivision improvements including flood and traffic control as determined by the Town Engineer.

4. Alternative types for assurances can be approved by the Town Engineer and Planning and Zoning Administrator. Development, other than subdivisions, shall use one of the following forms of assurance.

a. Cash or certified check.

b. Surety (performance) bonds executed by a company duly authorized and licensed to do business in the State of Arizona insuring the performance of the principal (subdivider/developer) as required by these regulations. The applicant may use the Town’s template form for bonds, or may submit a different bond form, provided the following items are included: name of the party being bound, development case number, forfeiture recital, corporate acknowledgments, notarized signatures, and descriptions and cost estimates of the required improvements. Applicant-submitted forms are subject to Town Engineer and Planning and Zoning Administrator approval.

c. Certificates of Deposit, United States Treasury Bills or any security guaranteed by the United States Government, State of Arizona or any political subdivision thereof acceptable to the Town.

d. A deposit of money with a responsible escrow agent or trust company authorized and licensed to do business in the State of Arizona. This money may not be used or pledged by the depositor for any purpose during the period the escrow account is in effect.

e. A current letter of credit. Letters of credit shall be renewed prior to their expiration.

f. Any other type of assurance, which guarantees the required improvements to the same or better degree than the above forms. This form, which may be approved by the Planning and Zoning Administrator, must have no expiration date and may not be released or converted to any other form without the agreement of the Town.

(6/11 supplement, 2011.)

G. Terms of Assurances

All assurances shall remain in effect until release is authorized per Section 26.6.I.

H. Securing and Approval of Assurances

The assurances shall be submitted to and approved by the Town as follows:

1. Assurances for construction shall be posted with the Town’s Development Coordinator prior to recordation of the final plat or certification of the development plan. The assurances shall be listed on the development plan and/or final plat, and shall have been approved by the Town Engineer and Planning and Zoning Administrator. For multifamily and commercial projects that will be graded in phases, only the first phase of the assurance is required with the development plan or final plat. A general note shall be added to the development plan or final plat stating that grading permits will not be issued for subsequent phases without approved assurances.

2. Site stabilization and landscape assurances shall be posted, as required, prior to the issuance of a Type 2 or Type 3 grading permit or the commencement of work.

3. Other assurances as noted in Section 26.6.E will be posted as needed to allow a project to temporarily continue without all required improvements in place.

4. Changes in assurances under Section 26.6.F due to changes in ownership shall be reviewed, and approved as appropriate, by the Planning and Zoning Administrator and/or the Town Engineer.

5. For private development, cost estimates for all construction, site stabilization and landscaping improvements shall be submitted for review by the Town Engineer and Planning and Zoning Administrator.

a. Estimates shall be based on approved construction documents and shall be signed and sealed by the appropriate registrant (Engineer or Landscape Architect).

b. Approved cost estimates are required prior to the acceptance of any assurances.

6. For projects involving public facilities, a cost estimate for construction only, which may include site stabilization and landscaping, shall be submitted for review by the Town Engineer and Planning and Zoning Administrator.

a. Estimates shall be based on approved construction documents and shall be signed and sealed by the appropriate registrant (Engineer or Landscape Architect).

b. Approved cost estimates are required prior to the acceptance of any assurances.

7. A contractor’s itemized formal bid may be substituted for any required cost estimate.

(6/11 supplement, 2011.)

I. Releases of Assurances

1. The assurances shall be released, with the exception of assurances for water infrastructure, upon satisfactory performance and acceptance of the work as determined by the Town Engineer and/or the Planning and Zoning Administrator.

2. Trust assurances may be released upon completion and inspection of the required subdivision improvements. Partial releases, up to fifty percent (50%), may be granted for a group of lots where the required improvements for the group of lots have been satisfactorily completed and such improvements can be used and maintained separately from the improvements required for the balance of the subdivision plat. Partial releases shall be administered and approved by the Town Engineer and/or the Planning and Zoning Administrator.

3. Reductions from monetary assurances may be made from any deposit made pursuant to this Section. Such progress payments shall be made to the assurance holder in accordance with standards established by the Town Engineer and the Planning and Zoning Administrator. In no case shall the assurances be reduced to an amount less than fifty percent (50%) of the original assurance amount until such time as the Town Engineer and Planning and Zoning Administrator deem the required improvements to be in full compliance, including the installation of all safety-related improvements, as determined by the Town Engineer.

4. Once a monetary assurance has been reduced, a rider or substitute monetary assurance must be in place fourteen (14) days after a release letter has been issued.

5. In order to grant partial release of assurances, sufficient major grading, drainage, and transportation improvements as determined by the Town Engineer shall be completed.

6. Full release of assurances shall be processed once improvements have been completed and accepted by the Town Engineer and Planning and Zoning Administrator and the Town has completed a field inspection. Further, the developer shall meet the following requirements:

a. As-built plans and required certification letters have been submitted for review and have been accepted by the Town Engineer and Planning and Zoning Administrator.

b. Submittal and approval of a close out package as defined in the approved grading permit.

c. To guarantee the good condition of landscape improvements, one of the following:

i. A landscape maintenance bond in the amount of ten percent (10%) of the original landscape bond amount shall remain in place for a period of one (1) year from the complete installation of the landscape materials and any replacement materials. The type of assurance shall be as specified in Section 26.6.F.

ii. A signed warrantee of the landscaping for a period of one (1) year from a licensed landscape contractor with extensions as required for any replacement materials.

iii. For deeded or dedicated streets, drainage ways and rights-of-way, compliance with Oro Valley Town Code Article 7-9.

d. To guarantee proper function of drainage improvements, a drainage assurance in the amount of ten percent (10%) of the original site stabilization assurance amount shall remain in place for a period of one (1) year from the complete installation of drainage improvements. The type of assurance shall be as specified in Section 26.6.F.

7. Release of the water infrastructure portion of the construction assurances shall require the completion of the following:

a. Completion of construction deficiencies;

b. Payment of all water-related fees including inspection and testing fees;

c. Easements for water facilities and maintenance are recorded;

d. Line extension agreements are executed, if applicable;

e. Compaction test results have been submitted and approved by the water utility;

f. Post-paving continuity tests have been submitted and approved by the water utility.

(6/11 supplement, 2011.)

J. Forfeiture of Assurances

1. The Town may take steps to utilize the assurances, upon the occurrence of any of the following:

a. In order to abate any unsafe conditions as determined by the Town Engineer, Building Official or Planning and Zoning Administrator;

b. Failure of the owner to respond within ten (10) days to cure a violation once a violation notice has been issued; or

c. When, in any way, the owner or their agent fails to follow the approved plan and does not correct the situation within sixty (60) days of notice by the Town.

d. Abandonment of the Project

A project will be presumed abandoned when there has been no development activity for six (6) months as determined by the Planning and Zoning Administrator.

2. In the event of any of the occurrences in Section 26.6.J.1, the Planning and Zoning Administrator shall issue a notice to the property owner and obligor of the assurances of pending forfeiture of assurances.

a. The owner shall respond to the Planning and Zoning Administrator in writing within ten (10) days of receipt of the notice to request a hearing with the Planning and Zoning Administrator, otherwise forfeiture shall occur.

b. Upon a determination by the Planning and Zoning Administrator or his/her designee, the Town may utilize the assurances for completing the project or portions of the project, and/or for bringing the project into compliance with Town requirements. Any amount of the assurances in excess of that required by the Town to stabilize the property shall be returned to the owner.