14-116.002: Letters of Credit
PURPOSE AND EFFECT: The amendment is to allow letters of credit to be drawn on financial institutions outside the State of Florida.
SUBJECT AREA TO BE ADDRESSED: The rule addresses the location of financial institutions on which letters of credit may be drawn.
SPECIFIC AUTHORITY: 334.044(2) FS.
LAW IMPLEMENTED: 334.044(30), 334.187, 337.106, 337.175 FS.
IF REQUESTED IN WRITING AND NOT DEEMED UNNECESSARY BY THE AGENCY HEAD, A RULE DEVELOPMENT WORKSHOP WILL BE NOTICED IN THE NEXT AVAILABLE FLORIDA ADMINISTRATIVE WEEKLY.
THE PERSON TO BE CONTACTED REGARDING THE PROPOSED RULE DEVELOPMENT AND A COPY OF THE PRELIMINARY DRAFT, IF AVAILABLE, IS: Deanna R. Hurt, Assistant General Counsel and Clerk of Agency Proceedings, Florida Department of Transportation, Office of the General Counsel, 605 Suwannee Street, Mail Station 58, Tallahassee, Florida 32399-0458
THE PRELIMINARY TEXT OF THE PROPOSED RULE DEVELOPMENT IS:
14-116.002 Letters of Credit.
(1) through (2) No change.
(3) Requirements of Letter of Credit. Letters of credit shall be issued solely for the benefit of the Department. Letter of credit language must be approved by the Department’s Comptroller and include the following:
(a) The expiration date of the letter of credit shall be automatically extended without amendment, for one year from the expiration date unless otherwise authorized in writing by the Department. Letters of credit furnished under the requirements of Section 337.106, F.S., shall not be required to be extended beyond the duration required by that section. If the letter of credit is not automatically extended for such additional one year period then at least 30 days prior to the expiration date then in effect, the bank or savings association shall notify the Department by registered or certified U.S. Mail or courier, postage prepaid, return receipt requested. This notification shall be sent to the Florida Department of Transportation, Office of Comptroller, 605 Suwannee Street, Mail Station 42B, Tallahassee, Florida 32399-0450, or to any other address specified in writing by the Department’s Comptroller.
(b) If notice is given that the letter of credit will not be automatically extended and if the purpose for which the letter of credit was issued still exists, the Department shall draw down any remaining balance on the letter of credit unless a substitute letter of credit meeting the requirements of this rule is provided at least 14 days prior to the expiration date of the letter of credit for which the substitute letter of credit is being provided.
(c) Once it is determined by the Department that the average financial condition ranking of a bank or savings association is less than 35, the Department will notify the bank or savings association and the applicant/professional service provider/contractor by registered mail that if a substitute letter of credit is not received within 30 days of notification, the Department will draw down any remaining balance on the letter of credit if the purpose for which the letter of credit was issued still exists.
(d) The letter of credit must provide for draws to be made on a bank or savings association located in the United States State of Florida and additionally must provide for draws by electronic presentation of a draft via facsimile transmission or electronic mail, or both.
Rulemaking Specific Authority 334.044(2) FS. Law Implemented 334.044(30), 334.187, 337.106, 337.175 FS. History–New 3-23-93, Amended 8-24-93, 10-11-94, 10-5-97, 1-18-04, 2-18-09,________.