The bonds specified in §§ 5-1.1 and 5-1.2 shall be procured by the director of budget and fiscal services as the director may deem in the best interest of the city, subject to the following conditions:
(1) That such bonds be procured from companies licensed to do business in Hawaii; and
(2) That such bonds be in favor of, and the premiums thereof shall be borne by, the city; provided that if any undertaking or project involving joint participation between the city and the United States or any agency of the United States, and is conditioned on the requirement that the officers of the city entrusted with the receipt and disbursement of funds be covered by a faithful performance or fidelity bond, then the United States may be named as co-obligee in the bond.
(Sec. 6-2.3, R.O. 1978 (1983 Ed.)) (1990 Code, Ch. 5, Art. 1, § 5-1.3)