City of Dana Point Grading Permit Bond
What is the Purpose of the Grading Permit Bond?
The City of Dana Point requires contractors performing construction involving grading to obtain a Grading Permit Bond. The bond represents a financial guarantee by the contractor and the issuing surety company to the City of Dana Point that all contracted work will be completed on time and the jobsite will be returned to its original condition.
The grading permit bond is required to assure that the work, if not completed in accordance with approved plans and specifications, will be corrected to eliminate hazardous conditions and/or threats to environmental conditions.
How Much Does the Bond Cost?
Section 8.01.320 of the Dana Point Municipal Code allows the amount of a grading security to be determined by the Grading Manual. Therefore, the amount of a grading security shall be based on 30% of the cost of the project cut or fill volume, whichever is greater, and 50% of the cost of the drainage improvements and erosion control facilities being constructed or installed under the permit. Pavement areas controlled through the grading permit process shall be considered as drainage devices. The amount of the security may be reduced by the Director to the extent that he determines that potential hazards or the nature of the project do not justify the full amount. The amount of the security may also be increased by the Director up to 100% of the cost of the larger of the cut or fill volume and 100% of the drainage improvements and erosion control facilities if the potential hazards or nature of the project justifies such an increased amount.
The bond cost for the contractor is typically between 1%-7.5% depending on the contractor’s personal credit score.
| Bond Amount | Bond Cost* |
|---|---|
| Varies | 1%-7.5% |
*Prices shown are based on several factors. Not all available pricing tiers are shown. Rates do not constitute an offer of bonding and are subject to change at any time.
How Does the Permit Application Process Work With the City of Dana Point?
To apply for a Grading Permit, applicants must complete and submit the Grading Permit Application that’s included in the Grading Permit Handout, which also contains a detailed list of all other actions and documents required to submit the application to the Engineering Division. Authorization by the Planning Division is required before the Engineering Division can accept a permit, as indicated on the permit application.
A $98.00 non-refundable administrative filing fee is due upon the submission of an application. Applicants are also required to submit plan check deposit fees, which are listed in the Fee Schedule.
Does CCIS File the Bond for Applicants?
City of Dana Point requires wet signatures** on filed bond documents. This means both parties must physically sign the bond prior to sending it in to the City of Dana Point. The original bond form issued by CCIS needs be mailed to or dropped off at the following location by the contractor once signed:
**Properly review bond forms to confirm if notarization is required. Failure to adhere to document requirements may lead to rejection of the bond form by the City of Dana Point.
Does This Bond Expire?
The permit bond expires upon the specified expiration date, typically one year from the date of issuance. A new permit bond will need to be purchased should the project take longer than one year.
Claims Information
If the City of Dana Point files a claim against the Grading Permit Bond, the Surety company will investigate the legitimacy of the claim and proceed accordingly. CCIS does not handle surety claims in office, however, claims contact information will be provided to the contractor, to move the claims process forward.
If the claim is found to be legitimate, the Surety company will payout to the City of Dana Point, up to the limit of the bond.
Unlike insurance policies that protect contractors from unforeseen events, this bond protects the City of Dana Point, its laborers, and suppliers from the actions of a contractor. Contractors are responsible for their actions and therefore must reimburse the Surety company for any claims paid. Failure to do so will significantly inhibit a contractor’s ability to obtain a surety bond for future jobs.
