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AN ORDINANCE RELATING TO LETTERS OF CREDIT AND SURETY BONDS IN LIEU OF A SECURITY DEPOSIT FOR OBTAINING UTILITY SERVICES BY THE CITY OF OSWEGO, KANSAS.
BE IT ORDAINED BY THE GOVERNING BODY OF THE CITY OF OSWEGO, KANSAS:
SECTION 1. Chapter 15, Article 1, Section 15-111 of the City Code is hereby amended to read:
15-111 LETTER OF CREDIT, SURETY BONDS AND REFUND
(a) Deposits for utility service will not be required if the customer provides a letter of credit from their previous utility company. Acceptable letter must provide prior 12 months history without any delinquencies, and the letter must be certified by an authorized agent, and be submitted on the utility company's letterhead.
(b) In all cases where any utility service is furnished a customer by the city, and the customer is current as set out in section 15-108(e), the security deposit made by such customer shall be refunded, and in the event any such customer moves to another location and desires any utility service to additional locations within the city, no security deposit shall be required for furnishing the same to such customer at such new or additional locations. This provision shall apply to both estranged spouses in the event of the subsequent legal separation or divorce of the customer and his or her spouse who qualified under this section.
(c) Deposits for utility service may be waived when a responsible party contract has been signed by a property owner. This situation may apply with a responsible party/tenant. In order for this contract to apply the following items must be met:
(1) the responsible party must be a current customer residing in Oswego, and have established good credit, meeting both criteria for a minimum of five years;
(2) the responsible party must also remain a current customer. Upon such time as the responsible party would no longer reside in Oswego, the tenant must meet one of the following: (A) submit a utility deposit as described in 15-108(b) for continued services, or (B) have established good credit (at least one full year with no penalties) while utilities are under the guarantee of the responsible party.
(3) the responsible party agrees to pay any utility bill left unpaid by the person receiving service under the responsible party contract and they understand and agree their utility service will become subject to disconnection if the tenant's bill is not paid within ten days of providing notice to the responsible party.
(d) Customers who have lived in the city prior to reestablishing an account and have established good credit will not be required to pay a utility deposit, as long as payments are paid on time each month.
(e) The deposits of present customers shall not be increased while they are furnished utility service or services and maintain good credit with the city, or at such time as they transfer services to a new location. Deposits will not be required of customers' moving from one location to another when customers have good credit with the city and their deposit has been returned for such good payment history.
(f) For customers wanting utility services at a second location or who open a business, no deposit will be required if they have a current paid account, with no delinquent payments for the past two years.
(g) In lieu of a security deposit, a surety bond may be posted by a business, commercial or industrial customers to guarantee the payment of bills. The surety bond shall be equal to two months’ estimated charge for the service or services to be rendered, such amount to be estimated and fixed by the city clerk, but in no event shall it be less than the current deposit amount charged to residential customers. Proof of existence of the bond shall be submitted to the city clerk before water service is furnished the customer, and should utility service be discontinued for nonpayment, the city shall proceed against the surety to collect such amounts due and unpaid; reserving, however, the right to proceed against the customer to collect the amount due. In cases where any utility service is furnished a customer by the city continually for two years without any delinquency, the customer shall no longer be required to post bond. If the customer desires utility service at another location or additional locations within the city, no surety bond will be required for furnishing the same to such customer at each new or additional locations, and the customer is current. The city may require a utility deposit or surety bond at any time customer would become delinquent in their payments after having established a good payment record.
SECTION 2 Ordinances in Conflict. Previous ordinances and any parts of ordinances in conflict with this Ordinance, or any part hereof, are hereby repealed.
SECTION 3. Publication and Effective Date. This ordinance shall be published one time in the Labette Avenue, the official City newspaper, and shall take effect and be in force from and after said publication.
PASSED AND ADOPTED BY THE GOVERNING BODY OF THE CITY OF OSWEGO, KANSAS, THIS 13TH DAY OF APRIL, 2015.
Mayor Glenn Fischer
Carol J. Eddington, City Clerk