Security Deposits and Letters of Credit

You are required to post securities (financial deposits) as part of some application approval processes, including:

Richmond Hill's Corporate and Financial Services Department, the Capital and Development Financing Section is responsible for the safekeeping of all Letters of Credit and cash security deposits.

Richmond Hill holds all securities posted until the owner completes all work, included in the agreements or permits. The completed work must also be approved by the appropriate divisions of Richmond Hill's Planning and Regulatory Services Department.

Security funds required

The amount of funds required for security deposits is based on the type of work being done.

Letters of Credit

Richmond Hill will only accept Letters of Credit that meet the following requirements:

  • Issued by banks only and approved by the City (letters from trust companies, credit unions and financial companies are not accepted)
  • Specify that the Letter of Credit is irrevocable
  • Issued in Canadian funds
  • Include an automatic renewal clause requiring the bank to provide 90 days advance notice to the Treasurer, by registered mail, if it intends not to renew the Letter of Credit

Letters of Credit must also follow acceptable wording outlined in one of the following documents:

  • Letter of Credit - Agreements - Subdivision, Servicing, Site Plan and Conditional Building Permit Agreements
  • Letter of Credit - Site Alteration Permit - Infill Lots, Grading/Frontage Security, Pools Pre-servicing/Pre-grading

Security deposits

Richmond Hill accepts certified cheques, banks drafts or money orders for smaller security deposits required for Site Alteration Permits, such as:

  • Pool security deposits
  • Grading and frontage for infills and severed lots
  • Tree securities
  • Film permits

It's our policy not to pay interest on security deposits. You are required to sign a form that says you are aware of our no interest policy when you make a security deposit.

Site plans

A Letter of Credit is needed to cover the securities required for Site Plan Agreements. The financial requirements for deposits are listed in Schedule A of the Site Plan Agreement and must be made before the execution of the agreement.

Securities needed for Site Plan Agreements:

Type of Work

Securities Required

Site Work

30 per cent of estimated work

Landscaping

100 per cent of estimated work

You must contact the Corporate and Financial Services Department at 905-747-6313 to arrange a site inspection once the project is complete. The securities posted for Site Plan Agreements will be released once your site passes inspection.

Subdivisions

A Letter of Credit is also required to cover securities for Subdivision Agreements. The financial requirements are listed in Schedule I of the Subdivision Agreement and must be posted before the execution of the agreement.

Securities needed for Subdivision Agreements:

Type of Work

Securities Required

Site Servicing

50 per cent of internal cost of work and 100 per cent external costs of works

Park Services

100 per cent park services cost

Lot Grading

$1,000 per lot, up to a maximum of $50,000

Occupancy

$1,000 per lot, up to a maximum of $50,000

Fire

$2,000 per firebreak lot, up to a maximum of $50,000

The timing and process for getting reductions or the release of subdivision securities are in the Subdivision Agreement. The applicant and/or their representative must contact the Project Coordinator handling their subdivision agreement in the Development Engineering Division at 905-771-8830 to discuss reductions and releases of securities.

Site alterations

A Letter of Credit or deposit is needed to cover the securities required for Site Alteration Permits. The security needs to be posted before a permit can be issued.

Securities needed for Site Alteration Permits:

Type of Work

Securities Required

Residential Lot, new infill or addition

$10,000

Swimming Pool, above or below ground

$3,000

Filling or Excavation, residential lot

$3,000

Filling or Excavation, commercial or industrial lot

$20,000

Filling or Excavation, all other lots

$20,000

Landscaping, residential lot

$3,000

Landscaping, commercial or industrial lot

$20,000

Landscaping, all other lots

$20,000

Site Plan and Subdivision Pre-grading, if servicing work is less than $250,000

$20,000

Site Plan and Subdivision Pre-grading, if servicing work is $250,000
to $500,000

$50,000

Site Plan and Subdivision Pre-grading, if servicing work is more than $500,000

$100,000

Site Plan Pre-servicing

30 per cent of servicing work cost,
$20,000 minimum

Subdivision Pre-servicing

20 per cent of servicing work cost