LGI Homes will post $5 million performance bond as it builds first phase of Village at Granite
GRANITE QUARRY — LGI Homes, which is developing the Village at Granite off Faith Road, has agreed to put up a $5,045,413 performance bond as a way of assuring Granite Quarry it will build all the infrastructure associated with the subdivision.
The Granite Quarry Board of Aldermen agreed Monday evening to that bond amount, which covers the first phase of what eventually is supposed to be a 250-home development.
Town Planner Steve Blount told aldermen the bond acts essentially as “an expensive insurance policy.”
In smaller, more traditional subdivision developments, after approved engineering drawings, the developer is authorized to install all site improvements such as stormwater management systems, sanitary sewer, water lines, roads and curbing.
When all that site work is complete, a final plat is submitted for approval and recordation at the register of deeds office. Once that happens, the developer can begin selling lots in the development.
But in this case, LGI is posting a performance bond instead of completing all the site improvements at once. This is allowed by a section in the town’s Unified Development Ordinance.
The bond covers the cost of completing the site work in case the developer fails to do so. It also allows the final plat to be approved and recorded so the developer can start selling lots while construction is underway.
The bond also will allow LGI to build display homes for viewing before all site work is completed.
Blount said the town’s engineer worked with LGI in arriving at the bond amount for the first phase.
As the improvements are completed and approved, Blount noted, the developer can request that the bond amount be reduced.
“These reductions in the bond amount will be reviewed by the town’s engineer and then brought back to you for approval,” Blount said in a memo to the town board.
LGI will deposit cash, an irrevocable letter of credit or other instrument convertible into cash at face value either with the town or a bank designated as an official depository of the town.
LGI’s performance bond is through The Hartford insurance company.
So far grading, road work, installation of stormwater retention ponds and some sewer work has been done on the site. The sewer is coming from the town of Faith, and Salisbury-Rowan Utilities is providing the water.
An entrance sign will be installed and a turn lane off Faith Road. Bad weather has sometimes hampered the project.
Village at Granite encompasses a 109-acre site. Future phases could include 40 units of multifamily housing and some commercial development, according to plans shared earlier.
In another development matter, the Board of Aldermen approved $34,735 as its share for a sewer line extension from Faith to serve Granite Quarry Industrial Park, which has been a joint project of the town and Rowan County.
A grant application to help pay for the sewer extension was made to the N.C. Department of Commerce’s Industrial Development Fund. The town and county’s share would each be $34,735.
Aldermen Kim Cress and John Linker said the town is bound by the previous board to provide sewer to properties in the industrial park. “I don’t like paying this money more than anyone else,” Cress said, but he added he wants to see the park move forward.
Granite Quarry would manage the sewer extension project should the grant be approved.
In another matter, aldermen decided to delay at least until July 1 the search for a new town manager.
Larry Smith has been serving as interim town manager.
Mayor Pro Tem Jim LaFevers and Mayor Bill Feather expressed concerns about delaying the search, worried that it would interfere with what Feather called “the election cycle” this summer and fall.
Filing for Granite Quarry’s municipal election will start in July, with the election to be held Nov. 5. To have the search process started and hire a town manager before the election cycle starts, aldermen would have to tackle that task immediately, Feather said.
Linker argued against rushing things, noting, “We have so much going on right now.”
Linker said the hiring of a new town manager probably is one of the most important decisions the board will make in efforts to get the right person in the job for long-term stability.
Linker said he didn’t see the connection between the search process and the election. He said he would rather see the board get through its “budget cycle” before starting to look for a new manager.
“I just don’t see the urgency,” Linker said.
A motion to wait until at least July 1, the start of a new fiscal year, passed by a 3-1 vote, with Linker, Cress and Alderman Jim Costantino voting for it. LaFevers voted against the motion.
Contact Mark Wineka at 704-797-4263.
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