Item 4CCITY OF
SOUTHLAKE
MEMORANDUM
(June 4, 2013)
To: Shana Yelverton, City Manager
From: Robert H. Price, P.E., Director of Public Works
Subject: Approve an amendment to the City's Commercial Developer
Agreement Template
Action
Requested: Approve an amendment to the City's Commercial Developer
Agreement Template.
Background
Information: The purpose of this item is to approve an amendment to the City's
Commercial Developer Agreement template which enhances the
explanations of several items and provides more detail to the
requirements by the City. These revisions will clarify some areas
that have been left to interpretation. Below is an outline of some of
the key items that have been updated in the General
Requirements:
• Public facilities has been defined as streets, sidewalks, water,
sewer, drainage and any other public infrastructure;
• Language was added to clarify that until the City accepts
infrastructure improvements, the City shall have no liability or
responsibility for such facilities;
• Language was added referencing the requirements of local,
state and federal ordinances, regulations and laws;
The Erosion Control section was modified to include language set
forth by the TPDES General Permit No. TXR15000. Below is an
outline of some of the key items that have been updated in the
Erosion Control section:
• Final stabilization is defined as stated by the TPDES General
Permit No. TXR15000 which specifically defines this action to
mean perennial vegetative cover with a density of 70% uniform
coverage of all disturbed areas;
• Erosion control measures required for final acceptance is
described.
Patterned concrete was added to the amenities that can be used in
Public Right of Way.
The addition of the language above better defines certain key
expectations that are required before the final acceptance of a
commercial project.
The Public Works staff has been working closely with the City
Attorney to develop the language that has been included in the
amended Commercial Developer Agreement Template.
Financial
Considerations: N/A
Strategic Link: The approval of this request links to the city's strategy map relative
to the focus areas of Performance Management and Service
Delivery by establishing and maintaining effective internal controls.
Citizen Input/
Board Review: N/A
Legal Review: The amended Commercial Developer Agreement template has
been reviewed by the City Attorney.
Alternatives: The City Council may approve this request or deny it.
Supporting
Documents: Commercial Developer Agreement Template.
Staff
Recommendation: Approve an Amendment to the City's Commercial Developer
Agreement Template.
Staff Contact: Robert H. Price, P.E., Public Works Director
Cheryl Taylor, P.E., City Engineer
Alejandra Ayala, P.E., Civil Engineer
Platted Name
(AKA)
COMMERCIAL DEVELOPER AGREEMENT
An agreement between the City of Southlake, Texas, hereinafter referred to as the
"City", and the undersigned Developer, DEVELOPER NAME, hereinafter referred to as
the "Developer", of ADDITION NAME, hereinafter referred to as "Addition" to the City of
Southlake, Tarrant County, Texas, for the installation of certain community facilities
located therein, and to provide city services thereto. It is understood by and between
the parties that this Agreement is applicable to the Addition (a commercial development)
and to the off -site improvements necessary to support the Addition.
I. GENERAL REQUIREMENTS
A. It is agreed and understood by the parties hereto that the Developer shall employ
a civil engineer licensed to practice in the State of Texas for the design and
preparation of the plans and specifications for the construction of all facilities
covered by this Agreement.
B. The Developer hereby agrees to comply with all federal, state, and local laws that
are applicable to development of this Addition.
C. The Developer agrees that the completed project will be constructed in
conformance with the Development Site Plan, Construction Plans and other
permits or regulatory authorizations granted by the City during the development
process.
D. Building permits shall not be issued until all Public Works infrastructure is
deemed substantially complete by the City, all appropriate Fire Code
requirements are satisfied and street signs with street names are in place.
Temporary, all-weather signs as specified in the Manual of Uniform Traffic
Control Devices (MUTCD) securely fastened in the ground are acceptable until
permanent street signs are installed. The Developer recognizes that Certificates
of Occupancy will not be issued until the supporting public works infrastructure
including permanent street signs with block numbers and regulatory signs within
the Addition have been accepted by the City. This will serve as an incentive to
the Developer to see that all remaining items are completed.
E. The Developer will present to the City, in form acceptable to the City, either (1) a
cash escrow, (2) Letter of Credit, or (3) performance bond and payment bond,
guaranteeing and agreeing to pay an amount equal to 100% of the value of the
construction cost of all public facilities (streets, sidewalks, water, sewer,
drainage, and any other public infrastructure improvements) to be constructed by
the Developer, and providing for payment to the City of the total remaining
amounts required for the completion of the public facilities if the Developer fails to
complete the work within two (2) years of the signing of this Agreement between
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the City and Developer. All bonds shall be issued by a bonding company
licensed to do business in the State of Texas. The Letter of Credit must meet the
Requirements for Irrevocable Letter of Credit which have been incorporated
herein.
The value of the performance bond, letter of credit or cash escrow will reduce at
a rate consistent with the amount of work that has been completed by the
Developer and accepted by the City. Performance and payment bonds, Letter of
Credit or cash escrow from the prime contractor(s), hereinafter referred to as
Contractor, or other entity acceptable to the City, may be accepted in lieu of
Developer's obligations specified above, at the discretion of the City.
F. Any guarantee of payment instrument (Performance Bond, Letter of Credit, etc.)
submitted by the Developer or Contractor on a form other than the one which has
been previously approved by the City as "acceptable" shall be submitted to the
City Attorney and this Agreement shall not be considered in effect until such City
Attorney has approved the instrument. Approval by the City shall not be
unreasonably withheld or delayed.
G. Any surety company through which a bond is written shall be a surety company
duly authorized to do business in the State of Texas, provided that the City,
through the City Manager, shall retain the right to reject any surety company as a
surety for any work under this or any other Developer's Agreement within the City
regardless of such company's authorization to do business in Texas. Approval
by the City shall not be unreasonably withheld or delayed.
H. The Developer agrees to furnish to the City a 2-year maintenance bond, letter of
credit or cash escrow in an amount equal to 100% of the cost of construction of
all public facilities (streets, sidewalks, water, sewer, drainage, and any other
public infrastructure improvements). The 2-year maintenance bond, letter of
credit or cash escrow will take effect on the date of final acceptance of all of the
public facilities in the Addition, and shall secure all costs of maintenance of such
public facilities for a period of two (2) years. The 2-year maintenance bond, letter
of credit or cash escrow will be supplied to the City by the contractors performing
the work, and the City will be named as the beneficiary.
I. No work shall be initiated on or in said Addition by Developer, save and except
as provided above; until the payment, performance and 2-year maintenance
bond, letter of credit or cash escrow required in Paragraphs E and H have been
provided to the City.
J. It is further agreed and understood by the parties hereto that upon acceptance by
the City, title to all facilities and improvements mentioned herein above which are
intended to be public facilities shall be vested in the City, and Developer hereby
relinquishes any right, title, or interest in and to said facilities or any part thereof.
It is further understood and agreed that until the City accepts such
improvements, the City shall have no liability or responsibility in connection with
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any such facilities. Acceptance of the facilities for this provision and for the entire
Agreement shall occur at such time that the City, through its City Manager or his
duly appointed representative, provides Developer with a written
acknowledgement that all facilities are complete, have been inspected and
approved, and are being accepted by the City.
K. On all public facilities included in this Agreement for which the Developer awards
his own construction contract, Developer agrees to the following procedures:
1. Developer shall pay all applicable fees and costs prior to scheduling a pre -
construction meeting, including the following:
a. Administrative fees equal to two percent (2%) of the cost of all public
facilities (streets, sidewalks, water, sewer, drainage, and any other public
infrastructure improvements) included in said agreement, based on actual
bid or contract construction costs;
b. Inspection fees equal to three percent (3%) of the cost of all public
facilities (streets, sidewalks, water, sewer, drainage, and any other public
infrastructure improvements) included in said Addition, based on actual
bid or contract constructions costs.
2. Developer shall also be responsible for the following fees and costs:
a. Cost of trench backfill density testing (95% Standard);
b. Any charges for re -testing as a result of failed tests;
c. Water usage after obtaining a fire hydrant meter from the City to be
utilized for construction purposes only;
d. Actual charges for inspections during Saturday, Sunday, holidays and
after normal working hours will be assessed to the project and payment by
the Developer will be required prior to final acceptance.
3. City agrees to bear the expense of:
a. All nuclear density tests on the roadway subgrade (95% Standard);
b. Technicians time for preparing concrete cylinders;
c. Concrete cylinder tests and concrete coring samples;
d. All gradation tests required to insure proper cement and/or lime
stabilization;
e. Soil series for cement or lime.
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4. The City can delay connection of private services to public utility mains
constructed under this Agreement until water mains, sanitary sewer mains
and storm drain lines have been tested and accepted by the City.
L. Both the Developer and any third party entity engaged in the construction of the
Development ("Builder") will be responsible for mowing all grass and weeds and
otherwise reasonably maintaining the aesthetics of all land in said Addition. After
fifteen (15) days written notice, should the Developer fail in this responsibility, the
City may contract for this service and bill the Developer and Builder for
reasonable costs. Such amount shall become a lien upon all real property of the
Addition so maintained by the City, and not previously conveyed to other third
parties, 120 days after Developer has notice of costs.
II. FACILITIES
A. STREETS
Street construction in the Addition shall be installed in conformance with the
requirements and in accordance with plans and specifications to be prepared by
the Developer's engineer and released by the Director of Public Works.
1. The Developer will be responsible for the following:
a. Installation and two-year operational cost of street lights, which is payable
to the City prior to final acceptance of the Addition; or an executed
agreement with utility provider stating that no charge will be made for
street lights for the two-year duration. The executed agreement must be
presented to the City prior to final acceptance;
b. Installation of all street signs based on the Manual on Uniform Traffic
Control Devices (MUTCD) as prepared by the Developer's engineer
designating the names of the streets inside the Addition, said signs to be
of a type, size, color and design standard generally employed by the
Developer and approved by the City in accordance with City ordinances;
c. Installation of all regulatory signs based on the MUTCD as prepared by
the Developer's engineer by an engineering study or direction by the
Director of Public Works. It is understood that Developer may install
signage having unique architectural features, however, should the signs
be moved or destroyed by any means, the City is only responsible for
replacement of standard signage and poles. Developer or property owner
will be responsible for any additional cost for replacement of custom or
unique signs.
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2. All street construction will be subject to inspection and acceptance
by the City. No work will begin on any street in said Addition prior
to complying with the requirements contained elsewhere in this
Agreement. All streets, water, sewer, drainage, and any other
public infrastructure improvements which are anticipated to be
installed within the street or within the street right of way will be
completed prior to the commencement of street construction on the
specific section of street in which the utility improvements have
been placed or for which they are programmed.
The Developer hereby agrees to advise the Director of Public Works as soon
as possible when any physical modifications to the alignment of public
infrastructure is required after construction has been completed. The
Developer agrees to cooperatively work with and assist in the coordination of
such modifications in a manner that will be least disruptive to street
construction and/or the integrity of surrounding public infrastructure.
B. ON -SITE WATER
The Developer hereby agrees to install water facilities to serve all lots shown on
the final plat of the Addition in accordance with plans and specifications to be
prepared by the Developer's engineer and released by the City for construction
and in accordance with Ordinance No. 170, as amended, and any other local,
state and federal regulations. The Developer shall be responsible for all
construction costs, materials and engineering. In the event that certain public
water lines are to be oversized to comply with the City's Water Master Plan, the
City will reimburse the Developer for the oversize cost greater than the cost of an
8" line.
C. ON -SITE SANITARY SEWER FACILITIES
The Developer hereby agrees to install sanitary sewage collection facilities to
service lots as shown on the final plat of the Addition. Sanitary sewer facilities
will be installed in accordance with the plans and specifications to be prepared by
the Developer's engineer and released by the City. Further, the Developer
agrees to complete this installation in accordance with Ordinance No. 440, as
amended, and any other local, state and federal regulations. The Developer
shall be responsible for all construction costs, materials, engineering, permits
and impact fees. In the event that certain public sanitary sewer lines are to be
oversized to comply with the City's Wastewater Master Plan, the City will
reimburse the Developer for the oversize cost greater than the cost of an 8-inch
line.
D. DRAINAGE
The Developer hereby agrees to install drainage facilities to service all lots as
shown on the final plat of the Addition in accordance with the plans and
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specifications to be prepared by Developer's engineer and released by the City
for construction. The Developer also agrees to adhere to Ordinance No. 605, as
amended. The Developer hereby agrees to fully comply with all EPA, TCEQ and
FEMA requirements relating to the planning, permitting and management of
storm water which may be in force at the time that development proposals are
being presented for approval to the City. The Developer hereby agrees to
comply with all provisions of the Texas Water Code.
Developments that require underground detention, the developer will be
responsible for providing a maintenance schedule as required by the.
E. EROSION CONTROL
The Developer agrees to comply with Ordinance No. 946, as amended,
regarding erosion and sediment control during construction of the Addition. The
Developer also agrees to comply with the Texas Commission on Environmental
Quality TPDES General Permit No. TXR150000, and all other applicable local,
state and federal ordinances, regulations and laws.
The Developer agrees to keep the streets and storm drain systems (MS4) free
from soil build-up by using soil control measures, such as those included in the
NCTCOG STANDARD SPECIFICATIONS FOR PUBLIC WORKS
CONSTRUCTION, Division 1000 EROSION AND SEDIMENT CONTROL to
prevent soil erosion. It will be the Developer's responsibility to present to the
Director of Public Works a Storm Water Pollution Prevention Plan (SWPPP)
and/or erosion control plan that will be implemented for this Addition. When in
the opinion of the Director of Public Works there is sufficient soil build-up on the
streets or other drainage areas and notification has been given to the Developer,
the Developer will have seventy-two (72) hours to clear the soil from the affected
areas. If the Developer does not remove the soil from the affected areas within
72 hours, the City may remove the soil build-up either by contract or by City
forces and place the soil within the Addition at the Developer's expense. All
expenses must be paid to the City prior to acceptance of the Addition.
Developer or its contractors must commence final stabilization of any disturbed
areas immediately after completion of all soil disturbing activities. The TDPDES
General Permit No. TXR150000 defines final stabilization as when all soil -
disturbing activities at the site have been completed and a uniform (i.e., evenly
distributed, without large bare areas) perennial vegetative cover with a density of
at least 70% of the native background vegetative cover for the area has been
ESTABLISHED on ALL unpaved areas and areas not covered by permanent
structures, or equivalent permanent stabilization measures (such as the use of
riprap, gabions, or geotextiles) have been employed.
Where construction activity on a portion of the site has temporarily ceased, and
earth disturbing activities will be resumed within 21 days, temporary erosion
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control and stabilization measures are not required on that portion of the site,
except as provided below. Erosion control and stabilization measures must be
initiated as soon as practicable in semi -arid areas and areas experiencing
droughts by the 14th day after construction activity.
After final stabilization has been established on all disturbed areas of the Addition
and all permanent erosion control measures have been installed and working
effectively, the Developer shall request final acceptance of the project to the
Director of Public Works. Inspection of the site will be required to ensure that the
erosion control plan has been properly installed and the permanent erosion
control measures will prevent soil erosion from the newly created lots from
washing into the street right-of-way, drainage -way or other private property.
F. USE OF PUBLIC RIGHT OF WAY
It is agreed by and between the City and Developer that the Developer may
provide unique amenities within public right-of-way, such as landscaping,
irrigation, lighting, patterned concrete, etc., for the enhancement of the Addition.
The Developer agrees to maintain these amenities until such responsibility is
turned over to the property owner. The Developer and his successors and
assigns understand that the City shall not be responsible for the replacement of
these amenities under any circumstances and further agrees to indemnify and
hold harmless the City from any and all damages, loss or liability of any kind
whatsoever by reason of injury to property or third person occasioned by its use
of the public with regard to these improvements and the Developer shall, at his
own cost and expense, defend and protect the City against all such claims and
demands.
G. AMENITIES
It is agreed by and between the City and Developer that the Addition may
incorporate a number of unique amenities and aesthetic improvements in
common areas of the Addition such as ponds, aesthetic lakes, unique
landscaping, walls, patterned concrete, specialty signage and accessory
facilities. The Developer shall be responsible for the construction and
maintenance of all such aesthetic or specialty items such as walls, vegetation,
signage, landscaping, street furniture, pond and lake improvements until such
responsibility is turned over to the property owner.
H. START OF CONSTRUCTION
Before the construction of the streets, water, sewer, streets or drainage facilities
can begin, the Developer must do the following:
1. Execute a Developer Agreement;
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2. Schedule and attend a pre -construction meeting between Developer and City
and including all Contractors, major Sub -Contractors, Utilities and appropriate
Government Agencies;
3. Furnish to the City a list of all subcontractors and suppliers which will be
providing greater than $1,000 of work in the Addition;
4. Submit for approval by the City the payment and performance bonds and 2-
year maintenance bond or acceptable alternate security naming the City as
beneficiary;
5. Submit at least two (2) - 22"x34" (full size) sets and five (5) - 11 "x17" (half
size) scalable sets of construction plans to be stamped "Released for
Construction" by the Director of Public Works plus any additional sets needed
for the developer and contractor;
6. Pay all fees required to be paid to the City;
7. Furnish to the City a policy of general liability insurance, naming the City as
co-insured, prior to commencement of any work. All insurance must meet the
Requirements of Contractor's Insurance attached hereto and incorporated
herein.
III. GENERAL PROVISIONS
A. INDEMNIFICATION
DEVELOPER COVENANTS AND AGREES TO INDEMNIFY AND DOES
HEREBY INDEMNIFY, HOLD HARMLESS AND DEFEND CITY, ITS
OFFICERS, AGENTS, SERVANTS AND EMPLOYEES, FROM AND AGAINST
ANY AND ALL CLAIMS OR SUITS FOR PROPERTY DAMAGE OR LOSS
AND/OR PERSONAL INJURY, INCLUDING DEATH, TO ANY AND ALL
PERSONS OF WHATSOEVER KIND OR CHARACTER, WHETHER REAL OR
ASSERTED, (INCLUDING, WITHOUT LIMITATION, REASONABLE FEES AND
EXPENSES OF ATTORNEYS, EXPERT WITNESSES AND OTHER
CONSULTANTS), ARISING OUT OF OR IN CONNECTION WITH, DIRECTLY
OR INDIRECTLY, THE CONSTRUCTION, MAINTENANCE, OCCUPANCY,
USE, EXISTENCE OR LOCATION OF SAID IMPROVEMENT OR
IMPROVEMENTS BY DEVELOPER, DEVELOPER'S AGENTS,
CONTRACTORS AND SUBCONTRACTORS, AND SHALL FURTHER BE
LIABLE FOR INJURY OR DAMAGE TO CITY PROPERTY, ARISING OUT OF
OR IN CONNECTION WITH ANY AND ALL ACTS OR OMISSIONS OF
DEVELOPER, ITS OFFICERS, AGENTS, EMPLOYEES, CONTRACTORS,
AND SUBCONTRACTORS. THIS OBLIGATION TO INDEMNIFY SHALL
APPLY TO ALL CLAIMS THAT ARISE FROM EVENTS THAT OCCUR PRIOR
TO THE TIME THE CITY ACCEPTS THE ADDITION, REGARDLESS OF
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WHETHER ANY SUCH DAMAGES, CLAIMS OR LIABILITIES ARE CAUSED,
IN WHOLE OR IN PART, BY THE NEGLIGENT ACT OR OMISSION, OR OF
THE CONCURRENT NEGLIGENT ACT OR OMISSION, OF THE CITY, ITS
OFFICERS AND EMPLOYEES, AND SHALL CONTINUE FOR TWO YEARS
AFTER THE CITY ACCEPTS THE ADDITION.
B. Venue of any action brought hereunder shall be in Fort Worth, Tarrant County,
Texas.
C. Approval by the Director of Public Works or other City employee of any plans,
designs or specifications submitted by the Developer pursuant to this Agreement
shall not constitute or be deemed to be a release of the responsibility and liability
of the Developer, his engineer, employees, officers or agents for the accuracy
and competency of their design and specifications. Such approval shall not be
deemed to be an assumption of such responsibility and liability by the City for
any defect in the design and specifications prepared by the consulting engineer,
his officers, agents, servants or employees, it being the intent of the parties that
approval by the Director of Public Works signifies the City's approval on only the
general design concept of the improvements to be constructed. In this
connection, the Developer shall for a period of two (2) years after the acceptance
by the City of the completed construction project, indemnify and hold harmless
the City, its officers, agents, servants and employees, from any loss, damage,
liability or expense on account of damage to property and injuries, including
death, to any and all persons which may arise out of any defect, deficiency or
negligence of the engineer's designs and specifications incorporated into any
improvements constructed in accordance therewith, and the Developer shall
defend at his own expense any suits or other proceedings brought against the
City, its officers, agents, servants or employees, or any of them, on account
thereof, to pay all expenses and satisfy all judgments which may be incurred by
or rendered against them or any of them in connection herewith.
D. This Agreement or any part herein, or any interest herein, shall not be assigned
by the Developer without the express written consent of the City Manager, which
shall not be unreasonably withheld or delayed.
E. On all facilities included in this Agreement for which the Developer awards his or
her own construction contract, the Developer agrees to employ a construction
contractor who is approved by the City, and whose approval shall not be
unreasonably withheld or delayed, said contractor to meet City and statutory
requirements for being insured, licensed and bonded to do work in public projects
and to be qualified in all respects to bid on public projects and to be qualified in
all respects to bid on public projects of a similar nature.
F. Work performed under the Agreement shall be completed within two (2) years
from the date thereof. In the event the work is not completed within the two (2)
year period, the City may, at its election, draw on the performance bond, Letters
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of Credit, or other security provided by Developer and complete such work at
Developer's expense, provided however, that if the construction under this
Agreement shall have started within the two (2) year period, the City may agree
to renew the Agreement with such renewed Agreement to be in compliance with
the City policies in effect at that time.
G. The City is an exempt organization under Section 151.309, Tax Code, and the
facilities constructed under this Agreement will be dedicated to public use and
accepted by the City upon acknowledgement by the City of completion under
Paragraph 1.F.
The purchase of tangible personal property, other than machinery or
equipment and its accessories, repair, and replacement parts, for use in the
performance of this Agreement is, therefore, exempt from taxation under
Chapter 151, Tax Code, if the tangible property is:
a. necessary and essential for the performance of the Agreement; and
b. completely consumed at the job site.
2. The purchase of a taxable service for use in the performance of this
Agreement is exempt if the service is performed at the job site and if:
a. this Agreement expressly requires the specific service to be provided or
purchased by the person performing the Agreement; or
b. the service is integral to the performance of the Agreement.
H. Prior to final acceptance of the Addition, the Developer shall provide to the City
two (2) copies of Record Drawings of the Addition, showing the facilities as
actually constructed.
Such drawings shall be stamped and signed by the registered professional
engineer of record. In addition, the Developer shall provide electronic files of the
drawings in a format acceptable to the City. The project coordinate system must
tie to the State Plane Coordinate System.
IV. OTHER ISSUES
A. OFF -SITE DRAINAGE
B. OFF -SITE SANITARY SEWER
C. OFF -SITE WATER
D. SIDEWALK ESCROW FEE
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E. DOWN STREAM CRITICAL STRUCTURE FEE
F. UNDERGROUND DETENTION
G. PARK FEES
H. TREE PRESERVATION ORDINANCE
All construction activities shall comply with Ordinance No. 585-D, as
amended, and Ordinance No. 585-13, as amended, which pertain to Tree
Preservation requirements and as may be amended by the City Council.
Such conditions include, but are not limited to, proper posting of tree
protection warning signs and tree protection measures to be maintained
throughout the duration of the project.
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SIGNED AND EFFECTIVE on the date last set forth below.
DEVELOPER
By:
Title:
Address:
STATE OF TEXAS
COUNTY OF TARRANT
On , before me, , Notary
Public, personally appeared
, personally known to me
(or proved to me on the basis of satisfactory evidence) to be the person whose name is
subscribed to the within instrument and acknowledged to me that he executed the same
in his authorized capacity, and that by his signature on the instrument, the person, or
the entity upon behalf of which the person acted, executed the instrument.
WITNESS my hand and official seal.
(SEAL)
Notary Public
My commission expires:
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CITY OF SOUTHLAKE, TEXAS
By:
Mayor
ATTEST:
City Secretary
Date:
City Attorney
Date:
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REQUIREMENTS FOR IRREVOCABLE LETTER OF CREDIT
1. The Letter of Credit must have duration of at least one year.
2. The Letter of Credit may be substituted for utility security deposits exceeding
$10,000.00. The City reserves the right to specify the face amount of the letter of
credit.
3. The Letter of Credit must be issued by a FDIC insured bank in a form acceptable
to the City of Southlake. The City reserves the right to approve/disapprove the
bank issuing the Letter of Credit.
4. The Letter of Credit must be issued by a bank that has a minimum capital ratio of
six (6%) percent, and has been profitable for each of the last two consecutive
years.
5. The customer must provide the City with supporting financial information on the
bank to allow the City to ascertain requirements are met. Suitable financial
information would be the previous two (2) years December 31 Call Reports
submitted to the FDIC and audited financial statements.
6. Partial drawings against Letter of Credit must be permitted.
7. The City must be able to draft on sight with proof of amount owed.
8. The customer pays any and all fees associated with obtaining Letter of Credit.
9. Expiring Letter of Credit must be replaced by a substitute Letter of Credit at least
30 days prior to the expiration date on the Letter of Credit held by the City.
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REQUIREMENTS FOR CONTRACTOR'S INSURANCE
Contractor's Insurance
1. Without limiting any of the other obligations or liabilities of the CONTRACTOR, during the term of the
Contract, the CONTRACTOR shall purchase and maintain the following minimum insurance
coverages with companies duly approved to do business in the State of Texas and satisfactory to the
CITY. In this section "Project" shall mean the public facilities to be constructed by Developer or under
Developer's contract with a CONTRACTOR. Coverages shall be of the following types and not less
than the specified amounts:
a. Workers' compensation as required by Texas law, with the policy endorsed to provide a waiver of
subrogation as to the CITY; employer's liability insurance of not less than the minimum statutory
amounts.
b. Commercial general liability insurance, including premises- operations; independent
CONTRACTOR's liability, completed operations and contractual liability covering, but not limited
to, the liability assumed under the indemnification provisions of this Contract, fully insuring
CONTRACTOR's (or Subcontractor's) liability for injury to or death of CITY's employees and third
parties, extended to include personal injury liability coverage with damage to property of third
parties, broad form property damage, with minimum limits as set forth below:
General Aggregate...................................................................................... $2,000,000
Bodily Injury .............................................$1,000,000 Each Occurrence
Property Damage .................................... $1,000,000 Each Occurrence
Products-Components/Operations Aggregate ............................................ $1,000,000
Personal and Advertising Injury .................................................................. $1,000,000
(With Employment Exclusion deleted)
Each Occurrence........................................................................................ $1,0001000
Contractual Liability:
Bodily Injury .............................................$1,000,000 Each occurrence
Property Damage .................................... $1,000,000 Each occurrence
The policy shall include coverage extended to apply to completed operations, asbestos
hazards (if this project involves work with asbestos) and ECU (explosion, collapse and
underground) hazards. The completed operations coverage must be maintained for a
minimum of one year after final completion and acceptance of the work, with evidence of
same filed with CITY.
c. Comprehensive automobile and truck liability insurance, covering owned, hired and non -owned
vehicles, with a combined bodily injury and property damage minimum limit of $1,000,000 per
occurrence; or separate limits of $500,000 for bodily injury (per person), and $500,000 for property
damage. Such insurance shall include coverage for loading and unloading hazards.
d. Property Insurance (Builder's All Risk)
CONTRACTOR shall purchase and maintain, at all times during the term of its Contract with
the Developer property insurance written on a builder's risk "all-risk" or equivalent policy form
in the amount of the initial contract price, plus value of subsequent contract modifications and
cost of materials supplied or installed by others, comprising total value for the entire Project
at the site on a replacement cost basis without optional deductibles. Such property insurance
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shall be maintained, unless otherwise in writing by all persons and entities who are
beneficiaries of such insurance, until final payment has been made or until no person or entity
other than the CITY has an insurable interest in the property required by this paragraph to be
covered, whichever is later. This insurance shall include interests of the CITY, the
CONTRACTOR, Subcontractors and Sub -Subcontractors in the Project.
Property insurance shall be on an "all-risk" or equivalent policy form and shall include, without
limitation, insurance against the perils of fire (with extended coverage) and physical loss or
damage including, without duplication of coverage, theft, vandalism, malicious mischief,
collapse, earthquake, flood, windstorm, falsework, testing and startup, temporary buildings
and debris removal including demolition occasioned by enforcement of any applicable legal
requirements, and shall cover reasonable compensation for CONTRACTOR's services and
expenses required as a result of such insured loss.
iii. If the insurance required by this paragraph requires deductibles, the CONTRACTOR shall
pay costs not covered because of such deductibles.
iv. This property insurance shall cover portions of the Work stored off the site, and also portions
of the Work in transit.
e. OWNER'S Protective Liability Insurance:
CONTRACTOR shall obtain, pay for and maintain at all times during the prosecution of the
work under the contract between the CONTRACTOR and the Developer, a CITY's protective
liability insurance policy naming the CITY as insured for property damage and bodily injury,
which may arise in the prosecution of the work or CONTRACTOR's operations under the
contract.
Coverage shall be on an "occurrence" basis, and the policy shall be issued by the same
insurance company that carries the CONTRACTOR's liability insurance with a combined
bodily injury and property damage minimum limit of $1,000,000 per occurrence.
f. "Umbrella" Liability Insurance:
The CONTRACTOR shall obtain, pay for and maintain umbrella liability insurance during the term of
the Contract between the CONTRACTOR and the Developer, insuring CONTRACTOR for an amount
of not less than $5,000,000 per occurrence combined limit for bodily injury and property damage
that follows form and applies in excess of the primary liability coverages required herein above. The
policy shall provide "drop down" coverage where underlying primary insurance coverage limits are
insufficient or exhausted.
Policy Endorsements
Each insurance policy to be furnished by CONTRACTOR shall include the following conditions by
endorsement to the policy:
name the CITY as an additional insured as to all applicable policies;
each policy shall require that 30 days prior to cancellation, non -renewal or any material change in
coverage, a notice thereof shall be given to CITY by certified mail. If the policy is canceled for
nonpayment of premium, only 10 days written notice to CITY is required;
the term "CITY" shall include all authorities, boards, bureaus, commissions, divisions,
departments and offices of the CITY and individual members, employees and agents thereof in
their official capacities, and/or while acting on behalf of the CITY;
the policy phrase "other insurance" shall not apply to the CITY where the CITY is an additional
insured on the policy.
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Special Conditions
1. Insurance furnished by the CONTRACTOR shall be in accordance with the following requirements:
any policy submitted shall not be submitted shall not be subject to limitations, conditions or
restrictions deemed inconsistent with the intent of the insurance requirements to be fulfilled by
CONTRACTOR. The CITY's decision thereon shall be final;
ii. all policies are to be written through companies duly licensed to transact that class of insurance in
the State of Texas; and
iii. all liability policies required herein shall be written with an "occurrence" basis coverage trigger.
2. CONTRACTOR agrees to the following:
i. CONTRACTOR hereby waives subrogation rights for loss or damage to the extent same
are covered by insurance. Insurers shall have no right of recovery or subrogation against
the CITY, it being the intention that the insurance policies shall protect all parties to the
contract and be primary coverage for all losses covered by the policies;
ii. companies issuing the insurance policies and CONTRACTOR shall have no recourse against the
CITY for payment of any premiums or assessments for any deductibles, as all such premiums
and deductibles are the sole responsibility and risk of the CONTRACTOR;
iii. approval, disapproval or failure to act by the CITY regarding any insurance supplied by the
CONTRACTOR (or any Subcontractors) shall not relieve the CONTRACTOR of full responsibility
or liability for damages and accidents as set forth in the Contract Documents or this Agreement.
Neither shall be bankruptcy, insolvency or denial of liability by the insurance company exonerate
the CONTRACTOR from liability;
iv. deductible limits on insurance policies exceeding $10,000 require approval of the CITY;
v. any of such insurance policies required under this paragraph may be written in combination with
any of the others, where legally permitted, but none of the specified limits may be lowered
thereby;
vi. prior to commencement of operations pursuant to this Contract, the Developer or the Developer's
CONTRACTOR shall furnish the CITY with satisfactory proof that he has provided adequate
insurance coverage in amounts and by approved carriers as required by this Agreement;
vii. CONTRACTOR shall provide notice of any actual or potential claim or litigation that would affect
required insurance coverages to the CITY in a timely manner;
viii. CONTRACTOR agrees to either require its Subcontractors to maintain the same insurance
coverage and limits as specified for the CONTRACTOR or coverage of Subcontractors shall be
provided by the Contract; and
ix. Prior to the effective date of cancellation, CONTRACTOR shall deliver to the CITY a replacement
certificate of insurance or proof of reinstatement.
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