(A) An MCS provider shall furnish the Council/franchising authority, in an amount totalling at least $100,000, a performance bond or security bond executed by a surety licensed to business in this state. The purpose of the performance bond is to ensure performance of any requirements imposed by this chapter on an MCS provider. Further, the purpose is to guarantee that should the MCS provider not fulfill any obligations imposed by this chapter (or where applicable a franchise agreement), then the surety will make whole (to the extent of the policy) any monetary losses incurred by the city.
(B) An MCS provider shall furnish to the Council/franchising authority a construction/completion bond prior to the time it commences a construction, upgrade, rebuild, or repair/maintenance project that has a capital construction cost or outlay exceeding $50,000 in value. The amount of the bond shall equal at least 90% of the projected capital construction cost or outlay. The construction/completion bond shall remain in force at all times, unless relief is granted or a reduction schedule is detailed in an agreement between the Council/franchising authority and the MCS provider.
(C) The construction/completion bond or security bond shall specifically guarantee that an MCS provider will timely abide by its construction, upgrade, rebuild, or repair/maintenance schedule for the multi-channel system and/or any timetable for technical and service improvements or additions to the multi-channel system as may be committed to, or agreed upon, from time to time, by the Council/franchising authority and MCS provider.
(D) If the city draws on a performance or completion bond or cash deposit as a result of an MCS provider's failure to timely discharge its obligations, or failure to construct and activate the multi-channel system, or failure to complete a multi-channel system upgrade or rebuild or repair/maintenance, then the MCS provider shall be required, within 30 days to replenish the completion and performance bond or security bond to the minimal level required by the Council/franchising authority.
(E) Should the Council/franchising authority make a formal determination that due to the MCS provider's past performance (such as a documented history of repeated or multiple franchise violations), or increased cost (greater than 50% of the original estimated cost), or documented untimeliness, or incompletion of projects listed in construction schedules, the Council/franchising authority may raise the required amount of either the performance or the construction/completion bond.
(F) The performance bond or security bond shall be in force at all times unless relief is granted or a reduction schedule is detailed in a written agreement between the MCS provider and the Council/franchising authority.
(Ord. 4-1994-20, passed 4-12-94) Penalty, see § 112.999