Surety Bond Encyclopedia

Utility Deposit Bond - Franklin Electric Plant Board in Kentucky

Brief Summary

The Franklin Electric Plant Board sets commercial deposits by usage, so a business opening a larger account can face a sizable cash deposit. A utility deposit bond lets you guarantee your electric bills to the Plant Board without parking that cash, once the Plant Board gives you the deposit figure and agrees to take a bond for it.

Franklin Electric Plant Board is the municipal electric utility for the City of Franklin, Kentucky, and a TVA local power company. Its deposit policy, effective 1/4/16, ties residential deposits to credit rating ($0, $200 or $330) and sets commercial deposits by usage. A utility deposit bond names the Franklin Electric Plant Board as obligee and guarantees that the customer pays its electric bills. Confirm the amount and bond form with the Plant Board office before the bond is issued.

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How to Apply for a Utility Deposit Bond:

Call the Plant Board office at (270) 586-4441 and get the deposit amount for your account in writing.
Confirm the Plant Board will accept a surety bond in place of the cash deposit, and ask for any required bond wording.
For new service, provide proof of ownership or lease and a picture ID, with signatures from all household members on the lease.
Complete the bond application and provide the information the surety needs for underwriting.
Pay the premium and receive the signed bond.
Deliver the original bond to Franklin Electric Plant Board, 309 North High Street, Franklin, KY 42134.

Detailed Information About the Kentucky Utility Deposit Bond:

The amount depends on your account type

The most common mistake is assuming there is one standard deposit. The Plant Board's published deposit policy, effective 1/4/16, has two tracks.

**Residential**, by credit rating:

Excellent credit: $0
Moderate credit: $200
Poor credit: $330

**Commercial**: determined by usage. The Plant Board asks commercial customers to contact the office to discuss the deposit amount.

A bond placed in lieu of a deposit should match the figure the Plant Board gives you for your account. Get that number in writing before you apply.

Who the obligee is

Franklin Electric Plant Board, 309 North High Street, Franklin, KY 42134, phone (270) 586-4441. It was incorporated in 1943 and serves more than 4,800 customers within the Franklin city limits as one of TVA's local power companies.

What the bond guarantees

The bond promises the Plant Board that the customer will pay its electric bills. If the account closes with an unpaid balance, the Plant Board can claim against the bond up to its amount, and the customer must repay the surety for any claim paid.

Other charges to know

The Plant Board's billing page lists a 5% late payment penalty on bills not paid by the due date, a separate disconnect notice for every unpaid account, a $25.00 return check charge, and a reconnection charge of $60.00 during office hours or $180.00 after hours. A bond does not replace any of these.

Before the bond is issued

The Plant Board's Rules and Regulations are posted on its website. Confirm with the office that it will accept a surety bond for your account, the amount it requires, and any bond wording it wants, before the bond is written.

Eligibility and Requirements for a Kentucky Utility Deposit Bond:

Franklin Electric Plant Board named as obligee.
Bond amount equal to the deposit the Plant Board sets for the account.
Principal name matching the name on the utility account exactly.
Service address or account number shown on the bond.
Surety company acceptable to the Plant Board.

Kentucky Utility Deposit Bond FAQs:

How much is the deposit at Franklin Electric Plant Board?

Under the policy effective 1/4/16, residential deposits are $0 for excellent credit, $200 for moderate credit and $330 for poor credit. Commercial deposits are determined by usage, and the Plant Board asks commercial customers to call the office to discuss the amount.

Who usually uses a bond for this deposit?

Commercial customers, because their deposit is set by usage and can be much larger than the residential tiers. The bond lets the business keep that cash while still guaranteeing its bills.

Will the Plant Board accept a bond?

Ask before you buy. The Plant Board sets the deposit and decides what security it will take. Get its agreement, the amount and any required wording first.

Does the bond cover late fees and reconnection charges?

The bond guarantees payment of what you owe the Plant Board if the account goes unpaid. You still owe the 5% late payment penalty, the $25.00 return check charge and the reconnection charge of $60.00 during office hours or $180.00 after hours when they apply, and the surety will seek repayment of any claim it pays.

Who regulates the Franklin Electric Plant Board?

It is a municipal utility and a TVA local power company serving customers within the Franklin city limits. Its deposit policy and rules come from the Plant Board itself, so questions about the deposit go to its office.