Subdivision Bonds Miami is a type of contract performance bond. They are required by a city, state or federal body as part of a construction contract. The obligee here is the city/state/federal body that rewards the contract and requires the bond. The principal is the contractor, developer or construction company that buys the bond.
What is the purpose of a Subdivision Bond?
The bond is a guarantee that the principal will undertake the construction of a subdivision or will finance and complete mandatory public improvements. These developments usually involve sidewalks, streets, curbs, drainage systems, gutters, and sewers. Subdivision bonds are now becoming increasingly common in state construction projects.
Why do we need Subdivision Bonds?
Subdivision Bonds Miami is meant for public improvement and for the development of the community. There are three main reasons for issuing Subdivision Bonds:
To ensure regular development
By making Subdivision Bonds part of the construction process, we ensure that regular development is carried out in a given area. Whenever a construction company, contractor or developer bids on a project, they also have to commit to the development of the subdivision. This could include building roads, curbs or maintenance of a parking area. Not only can we ensure that new improvements are carried out, but we can also see that the existing infrastructure gets an upgrade.
To reduce the burden on taxpayers
Without the bond in place, we cannot have any commitment from businesses to develop the local infrastructure. Without that, the government will be responsible for these improvements increasing the financial burden on the taxpayer.
To provide funds for public development
If the contractor or developer fails to carry out the development of the subdivision, the principal will have to pay the bond amount which then can be used for the intended subdivision development.