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(a) Prior to any cable system construction or rebuild, or other work in the streets, a franchisee shall establish in the city’s favor a construction bond in an amount specified in the franchise agreement or other authorization as necessary to ensure the franchisee’s faithful performance of the construction, rebuild or other work, but the amount of such construction bond shall not exceed 125 percent of the estimated cost of the street work and repair associated with such construction, rebuild or other work. The franchisee shall submit an estimate of such cost to the city for the city’s review.
(b) In the event a franchisee subject to such a construction bond fails to complete the cable system construction, rebuild or other work in the streets in a safe, timely and competent manner in accordance with the provisions of the franchise agreement, there shall be recoverable, jointly and severally from the principal and surety of the bond, any damages or loss suffered by the city as a result, including the full amount of any compensation, indemnification or cost of removal or abandonment of any property of the franchisee, or the cost of completing or repairing the system construction, rebuild or other work in the streets, plus a reasonable allowance for attorneys’ fees, up to the full amount of the bond. The city may also recover against the bond any amount recoverable against the security fund pursuant to subsection (d) hereof where such amount exceeds that available under the security fund.
(c) The franchise agreement may specify that upon completion of the system construction, rebuild or other work in the streets and payment of all construction obligations of the cable system to the satisfaction of the city, the city may eliminate the bond or reduce its amount. However, the city may subsequently require a new bond or an increase in the bond amount for any subsequent construction, rebuild or other work in the streets. In any event, the total amount of any bond shall not exceed the amount specified in subsection (a) hereof.
(d) The construction bond shall be issued by a surety with an A-1 or better rating of insurance in Best’s Key Rating Guide, property/casualty edition, shall be subject to the approval of the Law Director and shall contain the following endorsement:
This bond may not be canceled or allowed to lapse until 60 days after receipt by the city, by certified mail, return receipt requested, of a written notice from the issuer of the bond of intent to cancel or not to renew.
(e) The rights of the city with respect to any construction bond established pursuant to this section are in addition to all other rights and remedies the city may have under this chapter, the franchise agreement or at law or in equity.
(Ord. 97-2, passed 1-9-1997)