§ 37-12-11 - Substitution of securities for retained earnings.
SECTION 37-12-11
§ 37-12-11 Substitution of securities forretained earnings. – (a) Where any public works contract as defined by § 37-13-1 provides forthe retention of earned estimates by the state of Rhode Island, the contractormay, from time to time, withdraw the whole or any portion of the amountretained for payments to the contractor pursuant to the terms of the contract,upon depositing with the general treasurer either;
(1) United States treasury bonds, United States treasurynotes, United States treasury certificates of indebtedness, or United Statestreasury bills;
(2) Bonds or notes of the state of Rhode Island; or
(3) Bonds of any political subdivision in the state of RhodeIsland.
(b) No amount shall be withdrawn in excess of the marketvalue of the securities at the time of deposit or of the par value of thesecurities, whichever is lower. The general treasurer shall, on a regularbasis, collect all interest or income on the obligations so deposited and shallpay the interest or income, when and as collected, to the contractor whodeposited the obligations. If the deposit is in the form of coupon bonds, thegeneral treasurer shall deliver each coupon as it matures to the contractor.Any amount deducted by the state, or by any public department or officialthereof, pursuant to the terms of the contract, from the retained paymentsotherwise due the contractor, shall be deducted, first from that portion of theretained payments for which no security has been substituted, then from theproceeds of any deposited security. In the latter case, the contractor shall beentitled to receive interest, coupons, or income only from those securitieswhich remain after the amount has been deducted. The securities so depositedshall be properly endorsed by the contractor in such manner so as to enable thegeneral treasurer to carry out the provisions of this section.