§ 37-12-11. Substitution of securities for retained earnings.
(a) Where any public works contract as defined by § 37-13-1 provides for the retention of earned estimates by the state of Rhode Island, the
contractor may, from time to time, withdraw the whole or any portion of the amount
retained 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 treasury notes, United States treasury
certificates of indebtedness, or United States treasury bills;
(2) Bonds
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§ 37-12-11. Substitution of securities for retained earnings.
(a) Where any public works contract as defined by § 37-13-1 provides for the retention of earned estimates by the state of Rhode Island, the
contractor may, from time to time, withdraw the whole or any portion of the amount
retained 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 treasury notes, United States treasury
certificates of indebtedness, or United States treasury bills;
(2) Bonds or notes of the state of Rhode Island; or
(3) Bonds of any political subdivision in the state of Rhode Island.
(b) No amount shall be withdrawn in excess of the market value of the securities at the
time of deposit or of the par value of the securities, whichever is lower. The general
treasurer shall, on a regular basis, collect all interest or income on the obligations
so deposited and shall pay the interest or income, when and as collected, to the contractor
who deposited the obligations. If the deposit is in the form of coupon bonds, the
general treasurer shall deliver each coupon as it matures to the contractor. Any amount
deducted by the state, or by any public department or official thereof, pursuant to
the terms of the contract, from the retained payments otherwise due the contractor,
shall be deducted, first from that portion of the retained payments for which no security
has been substituted, then from the proceeds of any deposited security. In the latter
case, the contractor shall be entitled to receive interest, coupons, or income only
from those securities which remain after the amount has been deducted. The securities
so deposited shall be properly endorsed by the contractor in such manner so as to
enable the general treasurer to carry out the provisions of this section.