Utility Deposit Bond - Gainesville Regional Utilities in Florida

Brief Summary

GRU asks businesses for a security deposit before it turns on service, and a surety bond on GRU's own form can stand in for that cash. The deposit money stays in your operating account while the City of Gainesville still has a guarantee its bills will be paid.

Gainesville Regional Utilities accepts a surety bond on its Surety Bond for Utilities form as security for utility service. The obligee is the City of Gainesville, which owns GRU. The bond guarantees the customer will pay its utility bills, and if a bill goes unpaid 20 days past the bill date the surety must pay within 10 days of the city's written demand. The amount matches the deposit GRU requests, and GRU can require it raised to at least twice the average monthly bill.

We can help with all Florida bonds!

How to Apply for a Utility Deposit Bond:

• Get the security deposit amount GRU is requesting for your account.
• Use GRU's Surety Bond for Utilities form, revised 1/14/19, naming the City of Gainesville as obligee.
• Have the account holder's exact legal name as it appears on the GRU account.
• Provide owner or principal details for the surety credit review.
• Pay the premium and have the surety execute the bond with its name, address and phone number.
• Deliver the original bond to GRU and keep a copy for your records.

Detailed Information About the Florida Utility Deposit Bond:

The amount can go up after you post it

Customers often treat a utility deposit bond as a fixed figure. GRU's form does not. The bond starts at the deposit amount GRU requests, but the City of Gainesville may require an endorsement increasing it to at least two times the average monthly utility bill over the previous twelve months, on 15 days' written notice. A business that grows its usage should expect the bond to grow with it.

Who the obligee is

GRU is the City of Gainesville's municipal utility, so the bond runs to the City of Gainesville, a Florida municipal corporation, not to GRU as a separate company. The current form is titled Surety Bond for Utilities and is marked revised 1/14/19. The surety must be a corporation authorized to carry on a general surety business in Florida.

How a claim works

The principal promises to pay every utility bill promptly. If a bill is not paid within 20 days of the bill date, the city can make written demand and the surety must pay the delinquent amount within 10 days. If the city has to sue to enforce the bond, the principal and surety are jointly and severally responsible for court costs and reasonable attorney's fees. Anything the surety pays, the principal must repay.

How long it lasts

The bond has no fixed expiration. It stays in force until the surety cancels it or the City of Gainesville releases it in writing. A surety that wants out must give the city 30 days' written notice by certified mail, and the city can cancel or demand an increase on 15 days' notice to the customer. Losing the bond without replacing it means GRU will look for another form of security.

Letter of credit option

GRU also publishes instructions for an irrevocable letter of credit. Its dollar amount must equal the security deposit GRU requests, and the original is mailed to Gainesville Regional Utilities, PO Box 147051, Gainesville, FL 32614-7051. A letter of credit typically ties up bank credit for the full amount, which is why many businesses prefer the bond. Confirm with GRU's credit department which security it will accept for your account before the bond is issued.

Eligibility and Requirements for a Florida Utility Deposit Bond:

• City of Gainesville named as obligee.
• Penal sum equal to the deposit GRU requests.
• Surety must be a corporation authorized to write surety business in Florida.
• City may require an increase to at least two times the average monthly bill on 15 days' notice.
• Surety cancellation requires 30 days' written notice by certified mail to the city.
• Bond stays in force until cancelled or released in writing by the city.

Florida Utility Deposit Bond FAQs:

Official and Additional Resources for the Florida Utility Deposit Bond: