Section 8-409 Financial Security
Before any permit is issued, the Permit Authority may, in its discretion, require the applicant to provide a guarantee of financial security deemed adequate by the Town Manager and payable to the Town.
8-409.A. Purpose. The purpose of the financial guarantee shall be to assure that the applicant or permittee shall faithfully perform all requirements of the permit or applicable regulations adopted by the Town.
8-409.B. Amount. The amount of the financial guarantee shall be established upon consideration of the following applicable criteria:
8-409.B.1. The estimated cost of returning the site of the permitted development or activity to its original condition or to a condition acceptable to the Town in accordance with standards adopted by the Town for the matter of local or state interest for which the permit is being granted;
8-409.B.2. The estimated cost of completing the permitted development or activity; and
8-409.B.3. The estimated cost of complying with any conditions of the permit.
8-409.B.4. Estimated cost shall be based on the applicant’s submitted cost estimate plus the Permit Authority’s estimate of the additional cost to the Town of bringing in personnel and equipment to accomplish any unperformed purposes of the financial guarantee. The Permit Authority shall consider the duration of the development or activity and compute a reasonable projection of increases due to inflation. The Permit Authority may require, as a condition of the permit, that the financial security shall be adjusted upon receipt of bids.
8-409.C. Cash Deposit. At least ten percent (10%) of the amount of the financial guarantee shall be in cash deposited with the Town Treasurer and shall be placed in an earmarked escrow account.
8-409.D. Release. The financial guarantee may be released only when:
8-409.D.1. The permit has been surrendered to the Permit Authority before commencement of any physical activity on the site of the permitted development or activity; or
8-409.D.2. The development or activity has been abandoned and the site thereof has been returned to its original condition or to a condition acceptable to the Town in accordance with the standards adopted by the Town for the matter of local or state interest for which the permit is being granted; or
8-409.D.3. The project has been satisfactorily completed; or
8-409.D.4. Applicable guaranteed conditions have been satisfied.
8-409.E. Cancellation. Any security may be canceled by a surety only upon receipt of the Permit Authority’s written consent which may be granted only when such cancellation will not detract from the purposes of the security.
8-409.F. Failure of Surety. If the license to do business in Colorado of any surety upon a security filed pursuant to this Division is suspended or revoked by any state authority, then the applicant or permittee, within sixty (60) days after receiving notice thereof, shall substitute a good and sufficient surety licensed to do business in the state. Upon failure of the permittee to make substitution of surety within the time allowed, the Permit Authority shall suspend the permit until proper substitution has been made.
8-409.G. Forfeiture.
8-409.G.1. If the Permit Authority determines that a financial guarantee should be forfeited because of any violation of the permit or any applicable regulations, the Permit Authority shall provide written notice to the surety and to the permittee that the financial guarantee will be forfeited unless the permittee makes written demand to the permit authority within thirty (30) days after the permittee’s receipt of notice, requesting a hearing before the Permit Authority. If no demand is made by the permittee within that period, then the Permit Authority shall order the financial guarantee forfeited.
8-409.G.2. The Permit Authority shall hold a hearing within thirty (30) days after the receipt of the demand by the permittee. At the hearing, the permittee may present for the consideration of the Permit Authority statements, documents and other information with respect to the alleged violation. At the conclusion of the hearing, the Permit Authority shall either withdraw the notice of violation or enter an order forfeiting the financial guarantee.
8-409.G.3. The cash deposit described in Section 8-409.C. may be used by the Permit Authority of the Town in the event of the default or alleged default of the permit holder only for the purposes of recovering on the surety or fulfilling the permit obligations of the permit holder. In the event that the ultimate reviewing body determines that there has been no default by the permit holder, that portion of any moneys expended by the Town from the segregated funds relating to such default shall be replaced in the segregated account immediately following such determination. The Town may arrange with a lending institution, which provides money for the permit holder, that the institution may hold in escrow any funds required for the cash deposit. Funds shall be disbursed out of escrow by the institution upon the Town’s demand for the purposes specified in this section.
8-409.H. Inadequacy. If the forfeiture results in inadequate revenues to cover the costs of accomplishing the purposes of the financial guarantee, the Town Attorney shall take such steps as he or she deems proper to recover such costs where recovery is deemed possible.