Six Considerations in Underwriting Subdivision Bonds

LAND DEVELOPMENT LAWS, which regulate land use and subdivision growth, are commonplace in most states, counties, and local municipalities (Public Agency). These laws and regulations (Statutory Scheme) allow the Public Agency to control the design and improvements of subdivision developments to assure consistency with local public health and environmental standards, and to coordinate subdivision planning (lot size, configuration, street patterns, and utility easements), as well as overall community planning. Most importantly, the Statutory Scheme ensures that the developer properly installs streets, sewers, lighting, Feature sidewalks, and drains prior to their dedication to the Public Agency and its taking over their maintenance. Ultimately, the Statutory Scheme is designed to prevent the subdivision from becoming an undue burden on the community and local taxpayers. In the course of this two-part series, we will examine the basis for and the scope of subdivision bonds, as well as six important considerations in underwriting these types of bonds.

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