The City of Casey is amending its bonds process in light of the impacts COVID-19 is having on the development industry and the delivery of community infrastructure needed for our growing municipality.
Currently, the City of Casey provides flexibility for developers by holding a monetary bond as a guarantee for incomplete works to allow development to progress. Where appropriate developers can lodge a monetary bond or bank guarantee to provide Council with surety that the works will be completed at a later stage. This allows projects to proceed when some works are not completed in accordance with endorsed plans.
City of Casey CEO Glenn Patterson said Council officers have reviewed the current bonds practice and believe that by distinguishing between low and high-risk development type and works, that a significant amount of money can be returned to the development sector to support developers through the current COVID-19 pandemic and beyond.
“Developers approached us early in the pandemic requesting a review of the bonds process to assist them during this challenging time. In response, Officers prepared and released a Development Sector Action Plan in May 2020 to outline how the City of Casey would support the development sector through the COVID-19 crisis. Action 16 of that document was the “Release of building and development bonds”,” said Mr Patterson.
Changes being implemented:
- Reduce the incomplete civil works from 150% bond to 100% for low risk items
- Reduce the landscape construction bond from 115% bond to 100% for greenfields subdivision projects that will be completed within 12 months from approval
- Remove the requirement of a bond for asphalt wearing course and kerbside numbering
- Maintain maintenance bonds at 35% for landscape and 5% for civil infrastructure
- Maintain current civil bond at 150% for high risk development and infrastructure
- Maintain current landscape construction at 115% for infill development
Mr Patterson added to further support the development sector, we propose to reduce bond liabilities from 1 January 2019 to further support developers during the current challenging environment.
“Council Officers will also be undertaking an audit of current outstanding bonds to proactively liaise with developers for works that have been outstanding for more than 12 months, to ensure they deliver outstanding infrastructure projects so that Council can return bonds where works have been completed.
“We have reviewed the instances where Council has been required to use a bond to complete outstanding works and determined that in many cases this risk is low and that there is sufficient evidence to suggest that these amounts can therefore be reduced.”
From 1 October 2020, requests can be made for a refund to bring bonds down to the specified percentage (as outlined above). Individual requests for refunds will be considered on their merits.
Cash bonds will be refunded within 30 days of receipt of request. Bank guarantees will be returned 30 days after receipt of a new bank guarantee showing the adjusted amount.
