Local Zoning Zoning is the process by which a local community enacts ordinances to regulate and control the uses of privately owned land and structures within the community. In practice this process involves the creation of districts or zones within the community and restriction on the use of land, and the use, height and area of buildings within these districts. Zoning serves to promote and conserve the health, safety, convenience and general welfare of the community. The local zoning board or planning commission should be contacted early in your business planning to determine the regulations regarding any space in which you plan to operate your business. This is true especially if you plan to operate your business out of your home. The zoning ordinances of each local community detail the procedure for establishment of zones and the procedures for petition for variances. Note that the Legislature enacted modifications to certain statutes that, speaking generally, prohibit counties and municipalities from using “amortization” to eliminate or terminate a particular use of land. In this context, the term “amortization” occurs when a local government asserts that a once-lawful use of land is no longer allowed, so that the unit of government can take or condemn that land under the theory that it has no value. Bonding A bond is a contract, similar to an insurance policy, between a bonding company (called a “surety”) and the business that purchases the bond. The bond runs in favor of a third person to protect that person against financial loss caused by the act or default of the business. Surety bonds guarantee the performance of various types of obligations assumed by contract or imposed by law. Fidelity bonds guarantee against loss (e.g. theft of money or property) due to the dishonesty of employees. Performance Bonds Performance bonds provide financial guarantees that contracts and other business deals will be completed according to mutual terms. When a principal breaks a bond’s terms, the harmed party can make a claim on the bond to recover losses. Each performance bond that’s issued operates among the “obligee”, the “principal”, and the “surety”. • The obligee (the entity for whom the work is being performed) requires the principal (the entity performing the work) to purchase a bond to avoid potential financial loss to the obligee. • The principal purchases the bond to guarantee the performance and quality of work to be done. • The surety issues the bond and financially guarantees the principal’s capacity to perform a specific task. Before contacting a surety provider, professionals should check all federal, state and local regulations regarding performance bonds in their respective industries. Regulations regarding a specific performance bond in one state will vary from those that apply to a performance bond in another.
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