Road and Sewer Bonds
A Road Bond is a guarantee. Also known as a Section 38, this is an agreement that is put in place between the Developer and the Council or relative Authority to ensure the completion and adoption of a new road system on a development. The agreement is voluntary and between a developer and the Council. The developer agrees to Bond or place cash collateral to the value of the Road Works and covers that roadway until the end of the Making Good of Defects period and issue of the final certificate by the Council at the point of adoption. The Bond risk ceases at this point. The value is usually sufficient to ensure the Council can construct/repair the road if the developer fails to do so.