PCRES 1995-043PLANNING COMMISSION RESOLUTION 95-043
A RESOLUTION OF THE PLANNING COMMISSION
OF THE CITY OF LA QUINTA, CALIFC`Rf~A
RECOMMENDING APPROVAL OF ALLO':VABLE
FORMS OF AND ACCEPTANCE STAND?RDS FOR
SUBDIVISION IMPROVEMENT SECUR'I Y
WHEREAS, the City Council of the City of La Quinta did adopt Ordinance 2'12. revising
Chapter 13 of the La Quinta Municipal Code relating to subdivision regulations; and,
WHEREAS, said Ordinance 272 requires that the La Quinta City Council :specify, by
resolution, the forms of and acceptance standards for subdivision improvement security; and
WHEREAS, it is expedient that the City establish evidence of the stability and reliability
of financial institutions and sureties providing security for subdivision improvement'.; and
WHEREAS, the establishment of such evidence and the administration of certain forms
of security require the expenditure of time, the acquisition of documentary evidence, and/or the
consultation of legal advice or assistance, each of which result in significant cost to the City; and
WHEREAS, the costs of administration of the subdivision of property are ril;htly borne
by the subdivider; and
WHEREAS, the clarification of specific criteria for acceptance standards for subdivision
improvement security will have no effect upon [he environmental issues assessed in Environmental
Assessment 95-292 which addressed Ordinance 272;
NOW, THEREFORE, BE IT RESOLVED, by the Planning Commission of ttte City of
La Quinta, California, as follows:
SECTION 1. Improvement security for subdivisions within the City of La Quinta shall
conform with Section 66499 of the California Government Code and the following:
A. A cash deposit with the City or a responsible escrow agent or trust company,
at the City's option.
B. Surety bonds, of the form specified in Section 66499.2 of the California
Government Code, issued by sureties listed in the U.S. Department of Treasury
Circular 570 (latest version) listing of institutions authorized to issue bonds in
the State of California and the bonding limitations of those institutions.
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Planning Commission Resolution 95-043
C. Certificates of deposit, in the City's name, from one or more financial
institutions subject to regulation by the State or Federal government: and having
a fmancial quality rating of "A" or better and a commitment reliability rating
of "R-2" or better on the Investment Data Exchange (of the L,os Angeles
County Treasurer's office).
D. Irrevocable letters of credit, issued by one or more financial institutions
meeting the requirements of Paragraph C, pledging that the funds necessary to
carry out the completion of the improvements are on deposit, guaranteed for
payment, and constitute a trust fund which is not subject to levy or attachment
by any creditor of the depositor until released by the City. Izttc;rs of credit
shall guarantee that all, or any portion of the funds available pursuant to the
letters of credit, will be paid upon the written demand of the City and that such
written demand need not present documentation of any type as a condition of
payment, including proof of loss. The duration of any such letl:er of credit
shall be for a period of not less than one year from the execution of the
agreement with which it is provided and shall state, on its face, that the letter
of credit will be automatically renewed until such time that the City authorizes
its expiration or until sixty (60) days after the City receives notice from the
financial institution of intent to allow the expiration of the letter of credit.
E. Alien upon the subdivided property, if the City finds that it would not be in
the public interest to require the installation of the improvements sooner that
two (2) years after recordation of the final map or parcel map for which the
improvements are required. The lien shall provide a collateral vtilue of three
(3) times the estimated cost of the improvements secured thereby and shall
include the power of sale of the real property, all buildings and improvements
thereon, or that may be erected upon or made thereto, together with all
hereditaments and appurtenances thereunto belonging, or in any wise
appertaining, and the reservations, remainders, rents, issues, and profits
thereof. The collateral value of the property shall be establiished at the
subdivider's expense through an appraisal approved by the City.
F. When any agency of the State, Federal, or local government provides at least
twenty percent (20%) of the financing for the improvements to be: completed,
security may be an instrument of credit from an agency of the Slate, Federal
or local government.
G. When the subdivider is anon-profit organization, security may be negotiable
bonds, of the kind approved for securing deposits of public moneys with the
City or in favor of the City, deposited, at the City's option, with the City or
a responsible escrow agent or trust company.
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Planning Commission Resolution 95-043
SECTION 2. The administrative fee shall be applicable to the subdivision (final map, parcel
map or waiver of parcel map) rather than to individual security instruments. The fee shall be paid
separately for each different form and/or source (surety or financial institution) of security initially
submitted and for substitution of securities but shall not be required for submittal of warranty
security if the warranty security is of the same form and from the same source as the performance
security it replaces. The fees, to be paid at time of submittal of security, shall be as follows:
A. For certificates of deposit and letters of credit as described in Paragraphs C ahd
D of SECTION 1, for which establishment of evidence of reliability of the
financial institution requires the Ciry's membership in the Investment Data
Exchange, the subdivider shall pay an administrative fee of one hundred fifty
dollars ($150.00).
B. For liens on real property as described in Paragraph E of SEC'CION 1 for
which the City will prepare lien agreements and subordination agreements,
administer valuation of the real property and administer the agreements over
the life of the lien, all of which require legal assistance and financial advice,
[he subdivider shall pay to the City an administration fee of one half of one
percent (0.5%) of the estimated cost of the improvements secured but not less
than five hundred dollars ($500.00) nor more than five thousand dollars
($5,000.00).
SECTION 3. That it does hereby recommend approval of the hereinabove specified forms of
and acceptance standards for subdivision improvement security.
PASSED, APPROVED, AND ADOPTED at a regular meeting of the La Quinta Planning
Commission held on this 10th Day of October, 1995, by the following vote, to wit:
AYES: Commissioners Adolph, Anderson, Barrows, Butler, Gardneir, Newkirk,
and Chairman Abels
NOES: None
ABSENT: None
ABSTAIN: None
ABELS, Chairman
Quinta, California
A
tY H~RMAN, Community Development Director
of La Quinta, California
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