Ask Joe: Was parking kiosk company bonded to cover losses?

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Updated: 11/08/2013 7:23 pm
Question:
From the Ask Joe file one of our viewers has a question about the recent parking kiosk controversy in Reno.
Eddie Lorton, who is running for mayor, wants to know why the city of Reno did not collect on a performance bond that was in the original agreement with Curb Systems to protect the city against losses?

Answer:
I had a meeting with the city manager Andrew Clinger yesterday and I asked him about the performance bond.  Clinger says there was a bond for $460,000 written into the original agreement.  Basically that's like an insurance policy the company has to take out in case they go under and can't finish the project.  The bond would help ensure the project got finished.

Clinger says someone at the city dropped the ball and allowed the installation of those parking kiosks to start without actually making sure that bond was in place.  And it wasn't.  However Clinger also says the performance bond would not have covered performance of the parking kiosks, only the installation of the equipment.

The city says it lost hundreds of thousands of dollars in revenue because of faulty parking kiosks and tickets that could not be written after those kiosks were installed but they settled with Curb Systems for $7,500.

Again, the city manager says the city could not have collected even if that bond was in place.
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Breckenridge - 11/8/2013 7:43 PM
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Lorton should educate himself as to the purpose of a performance bond; there's probably not a bonding company on the planet that would bond this activity for a premium that could be afforded by the company being bonded.
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