Road and sewer bonds are a guarantee that when a developer is installing infrastructure like roads, sewers, mains water, and more, that they will be installed to recognised standards.
Should a developer fail to achieve installation to those recognised standards, the bond assures the local authority that the work will still be completed, or remedied, at the expense of the bond issuer.
Once the works are completed to a satisfactory standard, maintenance of the works is transferred to the local authority.