Chapter 3.78
GUARANTEES AND BONDS FOR LAND USE AND PUBLIC IMPROVEMENTS

Sections:

3.78.010    Purpose.

3.78.020    Definitions.

3.78.030    Performance bonds.

3.78.040    Maintenance bonds.

3.78.050    Warranty bonds.

3.78.060    General form of bonds – Cash or surety – Attorney approval required.

3.78.010 Purpose.

This chapter provides a centralized location in the Sequim Municipal Code for information about the guarantees, bonds, and warranties that may be required by the city to ensure satisfactory completion and maintenance of required improvements and environmental protections. (Ord. 2021-021 § 1 (Exh. A))

3.78.020 Definitions.

“Maintenance bond” means a cash or surety bond guaranteeing satisfactory maintenance of a city-required improvement for a specified period after completion.

“Performance bond” means a cash or surety bond guaranteeing satisfactory completion of a city requirement.

“Warranty bond” means a cash or surety bond guaranteeing that a city-required improvement will remain free from defects in labor and materials for a specified period after completion. (Ord. 2021-021 § 1 (Exh. A))

3.78.030 Performance bonds.

A. The city requires performance bonds in the following circumstances:

1. To guarantee completion of required improvements in land use projects before city approval of final plats and binding site plans or city acceptance of utility or roadway improvements;

2. To guarantee completion of construction, alteration, or repair of a sidewalk, driveway, curb, or gutter within the city;

3. To guarantee satisfactory construction of a utility extension on public rights-of-way;

4. To guarantee full performance of required critical areas mitigation and monitoring and stormwater controls;

5. To guarantee satisfactory installation of sidewalks, pedestrian walkways, or urban trails within subdivisions; and

6. To assure compliance with the provisions of Chapter 18.72 SMC, Variances.

B. Performance bonds must be in the form(s) described in SMC 3.78.060. (Ord. 2021-021 § 1 (Exh. A))

3.78.040 Maintenance bonds.

A. The city requires maintenance bonds to guarantee for a period of two years, the maintenance of improvements that were required by the city prior to approval of a plat, binding site plan, or variance, or acceptance of city-required improvements.

B. Maintenance bonds must be in the form(s) described in SMC 3.78.060. (Ord. 2021-021 § 1 (Exh. A))

3.78.050 Warranty bonds.

The city requires a warranty against defects in labor and material for a period of two years to warrant that improvements required by the city to be installed remain free from defects for a specified period after acceptance by the city. Warranty bonds must be in the form(s) described in SMC 3.78.060. (Ord. 2021-021 § 1 (Exh. A))

3.78.060 General form of bonds – Cash or surety – Attorney approval required.

A. Performance bonds, maintenance bonds, or warranty bonds may be posted in cash or underwritten by a surety company. All bonds must be accompanied by a written agreement in a form acceptable to the city attorney. Bonds underwritten by a surety company must be in a form acceptable to the city attorney and the surety company must be licensed to do business in the state of Washington. Posted payments may be made in U.S. dollars or by personal or cashier’s check, as appropriate. Letters of credit and similar instruments are not acceptable. The administrative services director will deposit the funds in a separately identified fund until such time as the bond is released.

B. All bonds are held and accounted for by the city administrative services director.

C. All bonds or warranties must describe with specificity the work or improvements required by the city, and the timeline for completion established by the city.

D. The administrative services director will release the bond upon receiving written authorization from the appropriate department director or designee that the bond or warranty period has expired or no further corrective action is needed. The bond will be released to the person or entity that posted it. (Ord. 2021-021 § 1 (Exh. A))