WILLIAM DONALD SCHAEFER, Governor Ch. 399

(B) (1) SUBJECT TO THE REQUIREMENTS OF THIS SECTION, A
CONTRACTOR UNDER A PROCUREMENT CONTRACT THAT A TRANSPORTATION
UNIT AWARDS FOR CONSTRUCTION OR RECONSTRUCTION IS ENTITLED TO
HAVE RETAINAGE UNDER THE PROCUREMENT CONTRACT PLACED IN AN ESCROW
ACCOUNT IF THE CONTRACTOR:

(I) ELECTS THAT PROCEDURE IN THE PROCUREMENT
CONTRACT IN THE SPACE PROVIDED FOR THAT ELECTION; AND

(II) SUBMITS TO THE TRANSPORTATION UNIT AN
ESCROW AGREEMENT THAT MEETS THE REQUIREMENTS OF SUBSECTION (C) OF
THIS SECTION.

(2) THE PROCUREMENT CONTRACT SHALL IDENTIFY THE
ESCROW AGENT.

(C)  THE ESCROW AGREEMENT SHALL:

(1)  BE ON A FORM THAT THE TRANSPORTATION UNIT
PROVIDES;

(2)  INCLUDE THE COMPLETE ADDRESS OF BOTH THE ESCROW
AGENT AND THE SURETY;

(3)  AUTHORIZE THE TRANSPORTATION UNIT TO PAY
RETAINAGE TO THE ESCROW AGENT; AND

(4)  BE SIGNED BY:

(I)  THE CONTRACTOR;

(II)  THE SURETY FOR THE CONTRACTOR; AND

(III)  THE ESCROW AGENT.

(D)  ON COMPLIANCE WITH THE REQUIREMENTS OF SUBSECTION (B)
OF THIS SECTION, THE TRANSPORTATION UNIT SHALL PAY THE RETAINAGE
TO THE ESCROW AGENT UNLESS:

(1)  FEDERAL MONEY IS INVOLVED AND APPLICATION OF THIS
SECTION WOULD JEOPARDIZE TIMELY RECOVERY OF THAT FEDERAL MONEY;
OR

(2)  RETAINAGE IS WITHHELD FOR:

(I)  LACK OF PROGRESS ON THE PART OF THE
CONTRACTOR; OR

(II)  OTHER VIOLATIONS BY THE CONTRACTOR.

(E)  IN ACCORDANCE WITH THE ESCROW AGREEMENT, A CONTRACTOR
MAY REQUIRE AN ESCROW AGENT:

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