A. If the director determines that there is a potential for injury, damage or expense to the city as a result of damage to persons or property arising from an applicant’s proposed use of any right-of-way, the applicant may be required to make a cash deposit with the department of finance and asset management or to provide an assurance device or insurance in a form acceptable to the director for the activities described in the subject permit. The amount of the cash deposit, assurance device or insurance shall be determined by the director.

B. The requirements for performance deposits and insurance are based on considerations of the applicant’s prior performance, nature of the proposed use, cost of the activity, length of use, public safety, potential damage to right-of-way and potential liability or expense to the city.

C. In each case where the city requires or allows an applicant to provide an assurance device, the director shall determine the type of assurance device that will be used. The assurance device may be a nonrevocable letter of credit, set‑aside letter, assignment of funds, certificate of deposit, deposit account, bond, or other readily accessible source of funds. A bond will be accepted only when circumstances make a bond the only reasonable form of assurance as determined by the director, and the bond adequately protects the interests of the city, or when a bond is required by state statute.

D. Interest from any interest‑bearing form of assurance device will accrue to the benefit of the depositor.

E. If after the date by which the required work or improvements are to be completed under a performance assurance device, the director determines that the work or improvements have not been complied with, he/she shall notify the applicant. The notice must state:

F. If the work or improvements covered by the assurance device are not completed within the time specified in the notice given under subsection (E) of this section, the city shall obtain the proceeds of the device and do the work or make the improvements covered by the device. The city may either have employees of the city do the work or make the improvements or, by using procurement procedures established by law, have a contractor do the work or make the improvements.

G. If at any time the director determines that actions or inaction associated with any assurance device have created an emergency situation endangering the public health, safety, or welfare, creating a potential liability for the city, or endangering city streets, utilities, or property; and if the nature or timing of such an emergency precludes the notification of applicants as provided in subsection (E) of this section while still minimizing or avoiding the effects of the emergency, the city may use the assurance device to correct the emergency situation. The city may either have employees of the city do the work or make the improvements, or may have a contractor do the work or make the improvements. If the city uses the assurance device as provided by this section, the applicant shall be notified in writing within four days of the commencement of emergency work. The notice must state the work that was completed and the nature or timing of the emergency that necessitated the use of the assurance device without prior notification.

H. The permit owner is responsible for all costs incurred by the city in doing the work and making the improvements covered by the assurance device. The city shall release or refund any proceeds of a performance device remaining after subtracting all costs for doing the work covered by the device. The owner of the permit shall reimburse the city for any amount expended by the city that exceeds the proceeds of the device. The city shall have a claim against the owner for the amount of any excess.

I. In each case where the city uses any of the proceeds of the device, it shall give the owner of the permit an itemized statement of all proceeds and funds used. (Ord. 6436 § 4, 2018; Ord. 5009 § 10, 1997; Ord. 3533 § 1, 1985.)