20.02.280 Financial security.
Before a franchise or cable franchise granted pursuant to this title is effective, and as necessary thereafter, the franchisee shall provide and deposit such moneys, bonds, letters of credit, or other instruments in form and substance acceptable to the city as may be required by this title or by an applicable franchise. All financial securities for franchisees shall satisfy the minimum standards established by the engineering design and construction standards at the time of the franchisee’s acceptance.
Construction bonds sureties shall be provided as required by Washington State laws.
A. In order to secure the conditions agreed to in any franchise or cable franchise agreement negotiated under this title, for the full term of such agreements, each franchisee shall establish a permanent financial security in the form of a bond, assignment of funds, or an unconditional letter of credit from a Washington State bank with the city. The amount of the financial security shall be a minimum of $50,000, or such other amount as determined by the public works director to be sufficient. The financial security shall be maintained at the sole expense of the franchisee so long as any of the franchisee’s facilities are located within the public ways, or the franchisee provides services from facilities located in the public ways, and until released by the city. In the event a financial security involves a bank, the franchisee is responsible for negotiating any interest that may accrue to the account during the duration of effect. Should the franchise or cable franchise agreement being secured be terminated, the public works director will coordinate with other departments and determine if any portion of the security may be released by the city.
B. The security shall secure the full and complete performance of the requirements of this title, including any costs, expenses, damages, or loss the city pays or incurs, including civil penalties, because of any failure attributable to the franchisee to comply with any applicable legal requirements including, but not limited to, the codes, ordinances, rules, regulations, or permits of the city.
C. Before the city executes on the financial security or any sums are withdrawn from the financial security, the city shall give written notice to the franchisee:
1. Describing the act, default or failure to be remedied, or the damages, costs or expenses which the city has incurred by reason of franchisee’s act, default, or failure;
2. Providing a reasonable opportunity for franchisee to first remedy the existing or ongoing default or failure, if applicable;
3. Providing a reasonable opportunity for franchisee to pay any moneys due the city before the city executes the financial security or withdraws the amount thereof from the financial security, if applicable; and
4. That the franchisee will be given an opportunity to review the act, default or failure described in the notice with the city or designee.
D. Franchisee shall replenish the financial security within 14 calendar days after written notice from the city that there is a deficiency in the amount of the financial security.
E. When the value of work proposed to be performed under any permit within the public way exceeds the amount of the financial security in this provision, the franchisee may be required to provide an additional financial security in a sufficient amount as determined by the city. All financial securities provided in accordance with this title shall comply with the minimum standards in Chapter 12.24 ACC. (Ord. 6798 § 3 (Exh. C), 2020.)