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James City County BOS Agrees to Assist in Development of Westport Subdivision

In their meeting of 2/28/2012 The James City County Supervisors  voted to approve an agreement that will assist the failed subdivision of Westport across from Ford’s Colony on Centerville Road in move forward with development of the community.

The developer of Westport Subdivision has not made the necessary public improvements to the property and the lot owners have no road access or water. As a result, these lot owners cannot get  building permits.

James City County has entered into a Memorandum of Agreement  with Realtec, Incorporated, the property owner, and Meridian Land Company, the successor in interest to Meridian Bank, the lien holder on the Property, for installing infrastructure in the Westport Subdivision.

Leo Rogers, JCC Attorney, stated that while the County is not engaged in the business of development, it does serve as a consumer protection agent when it comes to the subdivision of lots. Mr. Rogers stated that it is required by local and State code that certain amenities get put into place.

Since Realtec is unable to install the necessary improvements, the agreement would allow the County and Meridian Land to install the improvements. The County’s liability is limited to the amount of the bond (the “Bond”), $2,245,000. The required infrastructure improvements are estimated to cost approximately $4,000,000. Under a proposed agreement, the County would call the Bond and either have the bonding company make the improvements or pay the Bond amount to the County. Given that the estimated costs exceed the Bond amount, it is unlikely the bonding company would take on the responsibility of installing the improvements.

It is possible that the County may need to file suit against the bonding company in order to collect on the Bond. Assuming the County collects the Bond proceeds, Meridian Land would obtain the title to the Property and assume responsibility for any additional costs for the improvements in excess of the Bond proceeds; in addition, the County would need to follow the Public Procurement Act in order to install the necessary public improvements. Meridian Land would be responsible for the additional cost and could be a party to the public contract or enter into a separate agreement. Meridian Land would be the project manager. Under any of these circumstances, the County’s liability would be limited to the amount of the Bond proceeds.

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