Short answer
Premium typically runs about 1 to 3 percent of the bond amount per year for a well-qualified developer. The bond amount itself is not a fixed statutory figure: the city or county sets it from the engineer's estimate of the public improvements still to be built, so the cost scales with the unfinished scope and can step down as phases are accepted.
Two numbers drive the cost. First, the bond amount, which the local government (the Obligee) sizes from the project engineer's estimate of the remaining improvements: streets, curbs, sidewalks, storm drains, water and sewer. Some states put guardrails around that figure, such as California's Subdivision Map Act security provisions and North Carolina's 125 percent cap, but the number is always project-specific. Second, the Premium rate, which Underwriting sets from the developer's financial strength and track record on similar work; roughly 1 to 3 percent per year is common for qualified developers.
Because the amount tracks unfinished work, many jurisdictions reduce the required security as improvements are inspected and accepted, which lowers the renewal premium. A developer with strong financials and a history of completed subdivisions pays at the bottom of the range.
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