HomeMy Public PortalAbout1991_10_09_R222The Town of
Leesburg,
irginia
RESOLUTION NO. 91- 222
A P~SOLUTION:
AUTHOR/ZnNG
SUBSTITUTE
SUBDMSION
PRESENTED October 9, 1991
ADOPTED October 9. 1991
A SUBSTITUTE AGREEMENT AND APPROVING A
PERFORMANCE BOND FOR THE FAIRWAY MANOR
WHEREAS, the Town Council approved letters of credit from Perpetual Savings Bank, FSB as
performance guarantees for the Fairway Manor Subdivision in the amount of $77,220.00; and
WHEREAS, SAD Realty Corporation, the new owner of the Fairway Manor Subdivision as a result
of a loan foreclosure, has presented a new contract for installation of public improvements and a new
corporate surety bond from the Homestead Insurance Company of New Jersey to replace the contract
and letter of credit provided by United Land Developers, Inc., the former owner, in the amount of
$77,200.00; and
WHEREAS, although the Homestead Insurance Company has an A6 Best Key Rating they do not
meet the town's minimum requirements for a surety; and
WHEREAS, corporate surety bonds issued by Homestead Insurance Company as performance
guarantees for public improvements are accepted by neighboring northern Virginia jurisdictions
including the Loudoun County Sanitation Authority; and
WHEREAS, Perpetual Savings Bank, FSB, the owner of SAD Realty Corporation, has entered the
Accelerated Resolution Program administered by the Federal Office of Thrift Supervision and is unable
to renew or extend the letter of credit issued as performance guarantees for Fairway Manor beyond
the current expiration date; and
WHEREAS, SAD Realty Corporation is unable to obtain any surety bond or letter of credit other
than the surety bond from Homestead Insurance Company due to the financial status and pending
Federal Government takeover of Perpetual Savings bank~ FSB; and
WHEREAS, when the Federal Resolution Trust Corporation (RTC) takes over the assets of
Perpetual Savings Bank, FSB, in accordance with the Accelerated Resolution Progrsm, the letter of
credit can be disaffirmed (cancelled) by the RTC; and
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A RESOLUTION: AUTHORIZING A SUBSTITUTE AGREEMENT AND APPROVING A
SUBSTITUTE PERFORMANCE BOND FOR THE FAIRWAY MANOR
SUBDIVISION
WHEREAS, the Town Attorney, Director of Finance, and Director of Engineering and Public
Works recommend acceptance of the corporate surety bond from Homestead Insurance Company as
the performance guarantees for the Fairway Manor Subdivision because of the pending takeover by
the RTC of Perpetual Savings BAnk~ FSB.
THEREFORE, RESOLVED by the Council of the Town of Leesburg in Virginia as follows:
SECTION I. The Town Manager shall execute a new contract for installation of public
improvements with SAD Realty Corporation for the Fairway Manor Subdivision.
SECTION II. The corporate surety bond issued by Homestead Insurance Company as the
performance guarantee for the public improvements in the Fairway Manor Subdivision in the amount
of $77,200.00 in a form approved by the Town Attorney is hereby approved.
SECTION IH. The public improvements shown on the plans approved by the Director of
Engineering and Public Works for the Fairway Manor Subdivision, shall be completed by June 24,
1993 in accordance with the terms of the contract for installation of public improvements.
SECTION IV. The letter of credit issued by Perpetual Savings Bank, FSB and provided by United
Land Development~ Inc., for the Fairway Manor Subdivision is hereby released.
PASSED this 9th day of October , 1991.
ATTEST:
Clerk of CounCil
Robert E. Sevila, Mayor
Town of Leesburg