§ 7-330. Security fund.

(a)

A franchise agreement shall provide that, prior to the franchise becoming effective, the franchisee shall post with the city a security fund. Such fund may be in the form of a cash deposit or letter of credit as provided in a franchise agreement. The security fund will be used to ensure the franchisee's faithful performance of and compliance with all provisions of this article, the franchise agreement, and other applicable law, and compliance with all orders, permits and directions of the city, and the payment by the franchisee of any claims, liens, fees, or taxes due the city which arise by reason of the construction, operation or maintenance of the system. The amount of the security fund shall be that amount set forth in a franchise agreement, taking into account the circumstances existing at the time, including but not limited to, what is necessary to protect the public, to provide adequate incentive to the franchisee to comply with this article and the franchise agreement, and to enable the city to effectively enforce compliance therewith. The franchise agreement shall provide for the procedures to be followed with respect to the security fund. Neither the posting of the cash deposit or filing of an indemnity bond or any form of surety bond with the city, nor the receipt of any damages recovered by the city thereunder, shall be construed to excuse faithful performance by the franchisee or limit the liability of the franchisee under the terms of its franchise for damages, either to the full amount of the bond or otherwise.

(b)

The rights reserved to the city with respect to the security fund or an indemnity bond are in addition to all other rights of the city, whether reserved by this article or authorized by other law or the franchise agreement, and no action, proceeding or exercise of a right with respect to such security fund or indemnity bond will affect any other right the city may have.

(Ord. No. 450, § 1, 9-28-99; Ord. No. 457, § 1, 1-8-02)