Letters of Credit
Financial Planning and Development Finance is responsible for the safekeeping of letters of credit, cash deposits and pay-on-demand surety bonds.
Security Deposits (Letters of Credit & Cash Deposits)
A letter of credit is required under various agreements to guarantee financial or performance obligations to the City.
A conforming Letter of Credit will be accepted. To conform a Letter of Credit must meet the following criteria:
1) Be issued by any of the following six Canadian Chartered banks set out in Schedule 1 of the Bank Act
- Bank of Montreal;
- Bank of Nova Scotia;
- Canadian Imperial Bank of Commerce;
- Royal Bank of Canada;
- TD Canada Trust;
- National Bank
2) The Letter of Credit must:
- state that it is Irrevocable;
- be in the City’s standard format;
- be issued in favour of The Corporation of The City of Vaughan at the address as it appears in the sample format. No department or person’s name can be added;
- be issued in Canadian funds;
- describe the purpose for which the Letter of Credit is being provided, legal description of property and Project file number or building permit;
- include an automatic renewal clause for the expiry date
For more information please refer to the Letter of Credit Policy (PDF)
Follow the Letter of Credit wording in the sample formats below:
Alternatives to a Letter of Credit are certified cheque and bank draft (cash deposit) or pay-on-demand surety bonds. The City shall hold these securities and process the release or draws in the same manner as a letter of credit. Cash deposits will be non-interest bearing.
For more information on Surety Bonds please refer to the Surety Bond Policy (PDF).
For Pay-On-Demand Surety Bonds, follow the wording in the template below:
Release of Security
| Municipal Services - Subdivisions | Release and reduction requests are processed upon direction from Development Engineering. Contact Engineering Department 905-832-2281 extension 3649 or 8670
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| Building Permit Securities - Subdivisions | Contact Building Standards for release requests at 905-832-2281 extension 8206
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Building Permit Securities – Site Plans and Unit Alterations
| Prior to the release of the security, the Owner and/or Permit Holder shall have all required Building inspections approved prior to contacting Financial Planning and Development Finance at 905-832-2281 and extension 8377 for letters of credit and extension 8817 for cash securities
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| Site Plans & Site Plan Letters of Undertaking | Upon completion of required works pursuant to your agreement contact Financial Planning and Development Finance at 905-832-2281 and extension 8377 for letters of credit and extension 8817 for cash securities
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| Industrial & Residential (not part of a site plan) | Upon completion of required works pursuant to your agreement contact Financial Planning and Development Finance at 905-832-2281 and extension 8377 for letters of credit and extension 8817 for cash securities
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| Pool Permit Securities | Upon completion of required works pursuant to your agreement contact Financial Planning and Development Finance at 905-832-2281 and extension 8377 for letters of credit and extension 8817 for cash securities |
| Other | Refer to release conditions in the agreement
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Contact Information
Financial Planning and Development Finance
Phone: 905-832-2281
Letters of Credit – ext. 8377
Cash Securities – ext. 8817