As mentioned in previous updates, on July 28th Council adopted the proposed amendments to the Subdivision and Development Bylaw, Development Application Fees Bylaw and Consolidated Fees Bylaw to implement the use of On-Demand Surety Bonds as an alternative form of security, in addition to cash and Letters of Credit, for the City's Development Cost Charge (DCC) installment payments, Servicing Agreements (SA), and Development Permit (DP) landscaping securities. 

Additional information can be found in the  full report by City staff. 

July 22, 2025

At their meeting on July 14th, Council approved the proposed On-Demand/Irrevocable Surety Bonds Pilot Program and gave three readings to the proposed amendments to the Subdivision and Development Bylaw, Development Application Fees Bylaw and Consolidation Fees Bylaw to implement the program changes.  The pilot program provides an opportunity to introduce the use of On-Demand Surety Bonds as an alternative form of security, in addition to cash and LoC, for the City's DCC instalment payments, Servicing Agreements (SA), and Development Permit (DP) landscaping securities. 

Proposed On-Demand/Irrevocable Surety Bond Pilot Program Criteria  

To ensure that the alternative form of security does not increase the City's risks in comparison to cash or LoC, Staff recommend the proposed On-Demand/Irrevocable Surety Bond Pilot Program require that the On-Demand Surety Bonds be irrevocable and on-demand, and be issued by: 

• Surety companies that are BC Financial Services Authority (BCFSA) registered;  
• Surety companies that are listed as Primary Surety Writer members of the Surety Association of Canada; and  
• Surety companies that have an A.M. Best Credit Rating of A+ or higher (A.M. Best is the largest credit rating agency in the world, specializing in the insurance industry). The On-Demand Surety Bond can only be cancelled if the City receives an acceptable replacement security. 

Next Steps 

Surety Bond Templates will be prepared for the three pilot categories to ensure all terms and conditions are acceptable to the City. Where the Surety Companies and City cannot agree on the legal documentation, then a Surety Bond will not be permitted, and the City will require cash or a LoC from the developers. In addition, the Pilot Program criteria and related information will be provided in the form of a Bulletin, which will be available on the City's website for reference. Staff recommend reviewing the Pilot Program in one year's time to assess the uptake in use of this form of security and consideration on whether the Pilot Program should be extended to other securities. To support the administrative costs of the pilot program, staff recommend that a Surety Bond Administration Fee of $750.00 be added to the Consolidated Fees Bylaw. The developer will be required to pay this fee prior to the adoption of the rezoning bylaw, issuance of the DP, approval of the subdivision, or issuance of the building permit to which the obligation (SA, landscaping, or DCC instalments) relates. 

UDI was pleased to collaborate with City staff on the implementation of this pilot program. You can read our correspondence to the City of Richmond by clicking the following link: City of Richmond Supporting Housing Development Through the Adoption of On-Demand Surety Bonds | UDI - Urban Development Institute 

Additional information can be found in the  full report by City staff.