HARRY HUGHES, Governor                                      4101

(B)  IF A CONTRACTOR ELECTS TO UTILIZE THE ESCROW ACCOUNT
PROCEDURE DESCRIBED IN THIS SECTION, THE CONTRACTOR SHALL
INDICATE THE ELECTION IN THE SPACE PROVIDED ON THE PROPOSED
DOCUMENTS. IF THE CONTRACTOR FAILS TO INDICATE AN ELECTION OR
REFUSES THE ELECTION, THE CONTRACTOR SHALL FORFEIT RIGHTS TO THE
USE OF THE ESCROW ACCOUNT.

(C)  (1) EXCEPT AS PROVIDED IN PARAGRAPH (2) OF THIS
SECTION, AFTER APPROVING THE ESCROW AGREEMENT, THE STATE AGENCY

DEPARTMENT OF TRANSPORTATION SHALL PAY TO THE ESCROW AGENT, AS

DEFINED BY THE CONTRACT, THE FUNDS RETAINED.

(2)  FUNDS RETAINED WITHHELD FOR LACK OF PROGRESS OR
OTHER DEFICIENCIES ON THE PART OF THE CONTRACTOR MAY NOT BE PAID
TO THE ESCROW AGENT, AS DEFINED BY THE CONTRACT.

(3)  THE ESCROW AGENT, AS DEFINED BY THE CONTRACT, IN
ACCORDANCE WITH THE STIPULATIONS CONTAINED IN THE ESCROW
AGREEMENT MAY:

(I) 1. INVEST THE FUNDS PAID INTO THE ACCOUNT;
AND

THE CONTRACTOR; OR

2. (II) PAY EARNINGS ON THE INVESTMENTS TO

(II) IF THE FUNDS ARE FULLY SECURED BY APPROVED

SECURITIES, RELEASE THE FUNDS TO THE CONTRACTOR FOR THE

CONTRACTOR'S USE.

(D) (1) RETAINED FUNDS INVESTED AND SECURITIES HELD AS
COLLATERAL MAY BE RELEASED ONLY AS DIRECTED BY THE STATE AGENCY
DEPARTMENT OF TRANSPORTATION.

(2) WITHIN 90 DAYS AFTER COMPLETION OF THE CONTRACT,
(2) AT THE TIME OF FINAL PAYMENT, THE STATE AGENCY DEPARTMENT OF
TRANSPORTATION WILL DIRECT THE ESCROW AGENT, AS DEFINED BY THE
CONTRACT, TO SETTLE THE ESCROW ACCOUNT BY PAYING THE FUNDS
THEREIN TO THE CONTRACTOR OR THE STATE AGENCY MONEY DUE, AS
DETERMINED BY THE STATE AGENCY.

SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall

take effect July 1, 1985.

SECTION 2. AND BE IT FURTHER ENACTED, That if House Bill
100 of 1985 becomes law, this Act shall be deemed to amend the
State Finance and Procurement Article such that references in
this Act to Article 21, § 3-1106 under the subtitle "Subtitle 11.
Payment of State Obligations" shall be deemed to refer to §
11-136.1 of the State Finance and Procurement Article, under the
heading "Part XI. Payment of State Obligations".