Seattle City Light 2016 ANNUAL REPORT | Audited Financial Statements 75 THE CITY OF SEATTLE—CITY LIGHT DEPARTMENT NOTES TO FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED DECEMBER 31, 2016 AND 2015 - 75 - including the completion of work on unit 55. The Department has withheld $2.0 million in retainage. The remaining work on unit 56 is valued at $5.0 million and is scheduled to be completed by February 2018. A transformer for generating unit 56 has passed final inspection at a foreign factory and delivery is expected in June 2017. The Department holds a $15.0 million performance bond for work on generating unit 56 that will be transferred to a $1.5 million warranty bond when the unit is operational. The Department also holds a $1.7 million warranty bond for the completed work on generating unit 55. Recent news reports have described financial losses by Toshiba Corporation and uncertainty about the company’s ability to continue as a going concern. The Department does not have any other knowledge that Toshiba will not be able to perform its remaining obligations under the contract. The Department is of the opinion that in the event of a failure to perform, remaining work can be completed with the unpaid portions of the contract and additional amounts available from the performance bond. * * * * * *