According to its February 2004 lease agreement for Warehouse No. 5, Pate Stevedore Company was required to post an annual security deposit, either in cash or by performance, equal to the total value of each year’s total rental and total minimum wharfage guarantee –$155,600 for the first year.
A month later,assistant City Manager Robert Payne sends a memo to then-City Manager Tom Bonfield recommending that Pate be released from the security deposit.
“Pate does not want to provide $155,600 in a cash deposit with the City as it needs this as operating capital during their initial phase.” Payne also tells Bonfield that Pate was having difficulty obtaining a performance bond.
The City Council passed the amendment that eliminated the requirement for a $155,600 security deposit on March 25, 2004.
Why is this significant? Last Monday, the Council allowed Al Coby to terminate the landscaping contract at the airport with Horace J. Shropshire because Shropshire had trouble getting a surety bond.
Once again, the city has different policies for different folks. Pate isn’t required to guarantee his lease payments that are hundreds of thousands of dollars, but a small contractor has to bond mowing the grass at the airport.