Council waives performance bond for local Strate subdivision; developer presents growth and water data

The Spring City Council voted unanimously May 7 not to require a performance bond for paving on the Strate-UP subdivision, accepting instead language that makes the developer contractually responsible for completing the roadwork and permits the agreement to be recorded with the county.

Developer Randy Strate told the council he has a longstanding local stake in the project, said the property is held by RLS Farms, LLC and Strate Farm LLC, and provided two paving bids (Christensen Ready Mix at $2.00 per square foot and Bennett Paving at $1.93 per square foot) estimating total paving costs of about $46,000–$48,000. He said a bond covering 110% of the cost would be roughly $58,000 but that bonding companies typically charge about 3% of the bond amount, making the upfront bonding fee near $1,500–$2,000.

Council Member Stan Soper and others described why many cities prefer objective safeguards such as bonds or cash deposits—particularly when developments are executed by special-purpose entities that might dissolve—but acknowledged that, if the council can verify the property is owned free and clear, a bond may be unnecessary in this case. Council Member Chris Anderson moved to waive a bond and require the developer’s obligation to be recorded in the development agreement; the motion passed 5–0.

In a related presentation, Mr. Strate provided three scenarios comparing half-acre and 1.06-acre-lot development for their fiscal and water impacts. For a hypothetical 100-home half-acre scenario he estimated approximately $977,000 in impact fees, an estimated $126,000 in annual water and sewer utility revenue, and additional property-tax and sales-tax allocations; under a 1.06-acre scenario he estimated somewhat higher property-tax receipts. He also summarized Spring City’s water sources and capacities, citing combined spring and well capacity of roughly 184 million gallons per year and noting current annual usage figures near 42–44 million gallons.

Council members acknowledged the financial projections and water numbers but cautioned that growth does not automatically resolve municipal fiscal pressures. The motion to waive the bond included a condition that the development agreement be recorded to provide enforceability and verification of property ownership.