Every grantee shall establish and maintain a cash security fund or provide city an irrevocable letter of credit in an amount specified in the franchise but no less than $25,000 to secure the payment of fees owed, to secure any other performance promised in a franchise or required by this ordinance, and to pay any taxes, fees or liens owed to city. The letter of credit shall be in a form and with an institution reasonably acceptable to and approved by the City Attorney. The city shall provide 10 days written notice that the grantee has failed to pay fees, taxes or liens or other performance. The notice shall outline with specificity the reason(s) the city believes it is entitled to draw upon the security fund. If the grantee does not respond in writing within five days, the city may draw upon the security fund. Assuming grantee responds within five days, the city and grantee shall within five days of the city's receipt of the grantee's response to the notice of intent to draw upon the security fund, attempt to reach a resolution. If a resolution cannot be reached at this meeting, the city may immediately proceed to draw upon the fund. Should the city draw upon the cash security fund or letter of credit, the grantee shall, within 14 days, restore the fund or the letter of credit to the full required amount. The city may from time to time require a grantee to change the amount of the required security fund/letter of credit to reflect changed risks to city and to the public, including delinquencies in taxes or other payments to city. The cash security fund or letter of credit must be obtained prior to the effective date of any franchise, transfer or franchise renewal, unless a franchise specifically provides otherwise.
(Ord. 24-2002)