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Staff describes use of performance sureties to finish incomplete site work; Richland Close used surety funds, larger Echelon/Lockwood Glen sureties under review
Summary
City staff described calling performance sureties to complete unfinished subdivision site improvements. Richland Close (4 lots) required about $55,000 of surety and left the city with an ~ $16,000 unbudgeted outlay; larger sureties for Echelon and Lockwood Glen total approximately $630,000 and remain under evaluation.
City staff told the Board of Mayor and Aldermen that the city has used performance sureties to complete unfinished subdivision site work where developers failed to finish required improvements, and staff reviewed a recent example (Richland Close) and ongoing work on larger neighborhoods (Echelon and Lockwood Glen).
Vernon and Dylan described the performance‑surety process: developers post sureties to guarantee site improvements, and as of Jan. 1, 2023, the city holds sureties at 125% of estimated cost (previously 110%). Richland Close (a 2015 preliminary plat converted to a four‑lot subdivision) had incomplete site items; staff called the surety in 2023 after repeated non‑response by the developer and used the surety to complete landscaping, sewer, street, drainage and green‑infrastructure items. Total improvement estimates were nearly $72,000; the surety realized was roughly $55,000, leaving ~$16,000 in city out‑of‑pocket cost covered by staff labor and equipment.
Staff told the board the larger Echelon/Lockwood Glen matters involve performance sureties totaling about $630,000; the developer reportedly dissolved an LLC, and staff has called the sureties and is evaluating the work required to complete outstanding improvements. Staff described internal steps taken to tighten processes: linking certificates of occupancy and completion to surety release, establishing milestone checks, a working group that tracks long‑term sureties, use of on‑call contractors to expedite work when needed, and consultation with the law department about accountability measures for developers who default.
Board members asked whether the city could access letters of credit or other instruments when a developer dissolves; staff confirmed the city received funds when the surety was called on Echelon/Lockwood Glen and said they would return to the board if additional funding beyond the surety is required.
