Surety Bond Encyclopedia

Right of Way Bond - City of Greenwood Village, CO in Colorado

Brief Summary

Greenwood Village will not release a right of way permit until the security document is uploaded with the application. For most contractors that means this bond, written on the city's own template and sized to the restoration work on the permit. A bond keeps your cash free instead of tying it up in a letter of credit, and one bond can cover several open permits in the city as long as its value stays above the total restoration on all of them.

The City of Greenwood Village requires security from anyone installing or maintaining facilities or doing work in the public right of way. The city's ROW User's Guide calls for a bond on the Greenwood Village template matching the cost of restoration or $5,000, whichever is greater. The bond satisfies Code Section 11-3-120, which allows a bond in place of a letter of credit, and it carries a two year warranty on the work.

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How to Apply for a Right of Way Bond:

Determine whether you work under a utility license agreement or Letter of Responsibility. If so, obtain the utility's acknowledgment letter instead of a bond.
Estimate the restoration cost for backfill, paving, concrete and landscaping on the permit.
Set the bond at the restoration value or $5,000, whichever is greater, or at a value above the total restoration on all open permits if one bond will cover several.
Have the surety execute the City of Greenwood Village Public Right-of-Way Performance, Payment, Maintenance and Warranty Bond template.
Upload the bond as the security document in the city's online ROW portal along with the plan set and the Method for Handling Traffic plan.
Pay the $50 nonrefundable application fee, then the inspection fees after technical approval.

Detailed Information About the Colorado Right of Way Bond:

Who posts this bond

Any contractor or utility that installs or maintains facilities or performs work in a Greenwood Village street, sidewalk or other public right of way needs a right of way permit, and the permit application requires a security document. The obligee is the City of Greenwood Village. The bond is filed on the city's form titled City of Greenwood Village Public Right-of-Way Performance, Payment, Maintenance and Warranty Bond.

Who does not post their own bond

The ROW User's Guide carves out two groups. Permittees operating under a license agreement with the city, such as Xcel Energy or Comcast, and permittees covered by a Letter of Responsibility, which includes many special districts and Denver Water, may instead submit a letter acknowledging that the applicant will be working under the permittee's surety. Every other permittee submits a bond. A contractor working for one of those utilities should get the acknowledgment letter from the utility, not assume it is covered.

How the amount is set

During the online application you enter the cost of restoration, meaning backfill, paving, concrete and landscaping. The guide's security section states the bond must match the value of the restoration or $5,000, whichever is greater. Firms with several projects in the city may use one bond across multiple permits, but its total value must be greater than the total restoration on all open permits. Confirm the final figure against the city's review comments before the bond is issued.

What the bond guarantees

Under the template the principal agrees to perform all requirements of the permit, Article 3 of the Greenwood Village Code and other applicable law, to indemnify the city, and to pay laborers, mechanics and suppliers on the job. All work must stay in good order and repair for two years against defective workmanship and materials, and the city may bring an action on the bond within two years from the date of probationary acceptance. The template cites Code Sections 11-3-20, 11-3-120 and 11-3-130.

Premium

The premium is a fraction of the bond amount set by the surety after reviewing the principal's credit, financial strength and experience with right of way work. Because this bond also carries payment and warranty obligations, underwriters look closely at how well the firm completes and restores its jobs.

Eligibility and Requirements for a Colorado Right of Way Bond:

City of Greenwood Village named as obligee on the city's own bond template.
Principal name matching the permittee entered in the ROW application.
Surety jointly and severally liable with the principal for performance, indemnity and payment of laborers and suppliers.
Two year warranty against defective workmanship and materials, with claims allowed within two years of probationary acceptance.
All restoration completed within 10 days of installing the facility in the right of way.

Colorado Right of Way Bond FAQs:

How much does the bond need to be?

The ROW User's Guide ties the bond to the restoration cost you enter in the application and calls for the value of the restoration or $5,000, whichever is greater. If one bond covers several open permits, its total must be greater than the combined restoration on all of them.

I am a subcontractor for Xcel Energy. Do I need my own bond?

Permittees operating under a license agreement with the city, such as Xcel Energy or Comcast, or under a Letter of Responsibility, such as many special districts and Denver Water, may submit a letter acknowledging that the applicant works under the permittee's surety. Obtain that letter from the utility before you apply.

Can I use a letter of credit instead?

Yes. Code Section 11-3-120 requires security, and the city's bond template states that the principal is providing the bond in lieu of a letter of credit. Most contractors choose the bond to keep their credit line open.

How long does the bond stay on the hook?

The work must remain in good order and repair for two years against defective workmanship and materials, and the city may bring an action on the bond within two years from the date of probationary acceptance.

What else is needed with the application?

A plan set showing the utility run and the surface disturbance, a Method for Handling Traffic plan, the security document and the $50 nonrefundable application fee. Inspection fees are due after technical approval.