Virginia House Bill HB378

Virginia 2024 Regular Session

• Introduced: 1/7/24
• Refer: 1/7/24
• Report Pass: 2/2/24
• Engrossed: 2/12/24

Caption

Developer performance guarantees; clarifies existing provisions related to periodic partial release.

Impact

This amendment aims to streamline the performance guarantee process, ensuring that developers are not unduly delayed in receiving funds that are rightfully theirs upon timely completion of projects. By mandating that local governments act within a set time frame, it seeks to reduce bureaucratic hurdles and promote efficiency in the development process. This is particularly significant for developers who may rely on the quick release of funds to continue their operations and enhance cash flow during ongoing projects.

Summary

House Bill 378 amends existing Virginia Code §15.2-2245 to clarify provisions related to the periodic partial release of performance guarantees required by governing bodies for construction projects. The bill stipulates that when a developer notifies the governing body of the completion of public facilities, the governing body must act within thirty days to either approve a partial release or provide written notice of any issues that specify defects or deficiencies in construction. Failure to respond within this timeframe results in an automatic approval for the partial release of the bond or guarantee.

Contention

Notable points of contention surrounding HB378 revolve around the potential for local governments to lose discretion in evaluating developments. Some may argue that the automatic approval clause limits the oversight that local bodies have, potentially leading to poorly constructed public facilities being accepted and released from financial guarantees without adequate review. Proponents of the bill, however, argue that it promotes necessary economic activity by alleviating delays and fostering a more predictable regulatory environment.