§ 61-35-103 — Contractor to be paid during progress of work - Retainage - Failure to pay - Rate of interest - Investment of retainage

Rate of interest - Investment of retainage.
If the contractor to whom a contract is let properly performs the work designated in the
contract, the board, at least once in each calendar month during the continuance of the contract
work, shall meet and receive and consider estimates furnished by the agent, engineer, or
architect acting for the district or if not so furnished, then by the contractor, and shall allow such
estimates in an amount of the estimated value of the labor and material furnished upon the
contract, and of the material then upon the ground for use in the contract, subject to retentions
as follows: ten percent of each estimate presented until such time as the project is fifty percent
completed, with no further retainage on estimates during the continuance of the contract. Upon
completion of ninety-five percent of the contract according to the estimates, the board may pay
to the contractor ninety-five percent of the amount retained from previous estimates. Any
amount retained after ninety-five percent completion of the contract must be paid to the
contractor in such amounts and at such times as are approved by the district, upon estimates by
its agent, engineer, or architect or the contractor, with final payment of all moneys due to the
contractor to be made immediately following completion and acceptance of the project.
Immediately after considering and allowing any such estimate, the board shall certify and
forward the same to the district treasurer or other official having the power to draw bonds, who
forthwith shall draw a warrant upon the proper fund and transmit the same promptly to the
contractor. If the board fails or neglects to receive and allow such estimate or certify any
estimate or final payment upon completion and acceptance or the proper officer required to
issue such warrant fails or neglects to issue a warrant as provided in this section, for a period of
more than thirty days from the date of such estimate or completion date, then the estimate or
final payment, together with any retainage properly payable, draws interest from its date at the
rate per annum of two percentage points below the Bank of North Dakota prime interest rate as
set thirty days from the date of such estimate or completion date until the issuance of a proper
warrant. Interest must be computed and added to the face of the estimate, final payment, or
retainage by the officer required to issue the warrant, must be included in the warrant when
drawn, and must be charged to the fund from which payment for the improvement is to be
made. On the amounts of estimates retained, as provided in this section, the board, authorized
committee, or public body in charge of the work may invest or deposit the retained amounts in
any financial association or institution in this state earning interest or dividends for the benefit of
the contractor. Any amounts so invested or deposited must remain in the name of the board,
authorized committee, or public body in charge of the work until final payment of all money due
to the contractor is to be made. Further, a contractor may not use or pledge such amount in any
manner until released and received by the contractor upon completion of the contract.