ORS 701.435
Deposits in lieu of cash retainage


(1)

When a contractor on a public contract deposits bonds, securities or other instruments under ORS 279C.560 (Form of retainage) (4), if the subcontract price exceeds $50,000 and constitutes more than 10 percent of the cost of the public contract, a subcontractor on the public contract may deposit bonds, securities or other instruments with the contractor or in a bank or trust company for the contractor to hold for the contractor’s benefit in lieu of moneys held as retainage. If the contractor accepts the bonds, securities or other instruments deposited as provided in this subsection, the contractor shall reduce the moneys held as retainage in an amount equal to the value of the bonds, securities and other instruments and pay the amount of the reduction to the subcontractor in accordance with ORS 701.420 (Partial payment) and 701.430 (Performance bond). Interest or earnings on the bonds, securities or other instruments shall accrue to the subcontractor.

(2)

When a contractor on a public contract elects to have the public contracting agency deposit the accumulated retainage in an interest-bearing account under ORS 279C.560 (Form of retainage) (5), the contractor, within 30 days following payment of the final amount due for construction of the public improvement, shall pay to each subcontractor who performed work on the construction the subcontractor’s proportional share of the interest earnings that accrued to the contractor as a result of the election. A subcontractor’s share of the total amount of interest earnings under this subsection shall be determined by the proportion that the amount of retainage withheld from the subcontractor bears to the amount of retainage withheld from the contractor and the length of time the retainage was withheld from the subcontractor. A share of the interest earnings shall be paid to a subcontractor under this subsection only when:

(a)

Retainage is withheld from the subcontractor for more than 60 days after the day on which the first partial payment was due the subcontractor under the terms of the subcontract; and

(b)

The amount of interest earnings due the subcontractor exceeds $100.

(3)

If the contractor incurs additional costs as a result of the exercise of an option described in subsection (1) or (2) of this section, the contractor may recover the costs from the subcontractor by reducing the final payment. As work on the subcontract progresses, the contractor shall, upon demand, inform the subcontractor of all accrued additional costs.

(4)

Bonds, securities and other instruments deposited or acquired in lieu of retainage, as permitted by this section, must be of a character approved by the Director of the Oregon Department of Administrative Services, including but not limited to:

(a)

Bills, certificates, notes or bonds of the United States.

(b)

Other obligations of the United States or agencies of the United States.

(c)

Obligations of a corporation wholly owned by the federal government.

(d)

Indebtedness of the Federal National Mortgage Association.

(e)

General obligation bonds of the State of Oregon or a political subdivision of the State of Oregon.

(f)

Irrevocable letters of credit issued by an insured institution, as defined in ORS 706.008 (Additional definitions for Bank Act). [1977 c.767 §2; 1983 c.690 §16; 2003 c.794 §320; 2009 c.568 §2]
Note: See note under 701.410 (Definitions).

Source: Section 701.435 — Deposits in lieu of cash retainage, https://www.­oregonlegislature.­gov/bills_laws/ors/ors701.­html.

701.002
Short title
701.005
Definitions
701.010
Exemptions from licensure
701.013
Intent relating to certain business license requirements
701.015
Business license requirements in cities and metropolitan service districts
701.020
Certain cities exempt from application of ORS 701.015
701.021
License requirement
701.026
Subcontractor licensing
701.031
Evidence of doing business as contractor
701.035
Applicant required to be independent contractor to be eligible for license
701.038
Residential limited contractors
701.042
Residential or commercial developers
701.046
License application
701.050
Commercial contractor key employees
701.056
Licensing application fee
701.060
Licensing in another category
701.063
Term of license
701.068
Bonding requirements
701.073
Insurance required of licensed contractors
701.081
Residential contractors
701.082
Residential contractor continuing education requirements
701.083
Residential contractor specialized education programs
701.084
Commercial contractors
701.086
Key employee continuing education
701.088
Contractor rehabilitating illegal drug manufacturing site
701.091
Responsible managing individual
701.093
Change in responsible managing individual
701.094
Definition for ORS 701.098 and 701.102
701.098
Grounds for discipline
701.102
Sanction for past unresolved activity or outstanding matters
701.106
Sanction for violation or failure to comply with certain laws
701.107
Sanction for assisting evasion of obligations
701.108
Failure to comply with prevailing wage rate or other wage and hour standards for energy efficiency and sustainable technology projects
701.109
Reporting of final judgments
701.110
License suspension for unpaid determined wage claim
701.112
Continuation of board authority when change occurs in license status
701.114
Change in responsible managing individual or persons exercising control of contractor
701.117
Contractor to notify board of address change
701.119
Certification to participate in small scale local energy project program
701.120
Specialized education programs
701.122
Training requirements for individuals and businesses
701.128
Suit for damages for misrepresentation
701.131
License required to perfect lien or obtain judicial or administrative remedy
701.133
Notice of intent to file complaint
701.139
Complaint validity
701.140
Types of allowable complaints
701.143
Requirement for timely filing of complaints
701.145
Resolution of complaints involving work on residential structures or certain small commercial structures
701.146
Resolution of complaints involving work on large commercial structures or certain small commercial structures
701.149
Status reports
701.150
Determination of amount to be paid from bond
701.153
Recording of order as lien
701.157
Satisfaction of order against commercial contractor
701.160
Nonlawyer may represent certain forms of businesses before board
701.180
Alternative mediation or arbitration process
701.205
Construction Contractors Board
701.215
Officers
701.225
Investigatory powers of board
701.227
Disqualification from eligibility for certain public contracts
701.230
Board to provide names of unlicensed or improperly endorsed contractors to other state agencies
701.235
Rulemaking
701.238
Determination of licensing application fee
701.240
Provision of licensed contractors list to other state agencies
701.246
Confidentiality of information
701.250
Board to provide licensee’s status on request
701.255
Funds retained for collection of civil penalties
701.260
Appeal committee
701.265
Continuing education system for residential contractors
701.267
Agreements with continuing education providers
701.269
Residential general master builder certification program
701.272
Interagency agreements
701.295
Board duty to investigate and seek prosecution of illegal activity
701.305
Requirement for written contract with residential property owner
701.310
Cancellation of contract
701.312
Additional grounds for placing contractor on probation
701.315
Contents of contract for work on residential structure
701.320
Offer of warranty
701.325
Condition for obtaining building permit
701.330
Consumer notice form
701.335
Recommended maintenance schedule
701.340
Commercial structure warranty
701.345
Subcontractor list
701.348
Sewer contractor requirements
701.410
Definitions
701.420
Partial payment
701.430
Performance bond
701.435
Deposits in lieu of cash retainage
701.440
Applicability to federal projects
701.445
Home inspectors
701.450
Home inspector undertaking of repair work on inspected structure
701.455
Home inspector services contractor license
701.470
Licensing
701.475
Definitions for ORS 701.475 to 701.490
701.480
Certification
701.485
Standards of practice and professional conduct
701.490
Exemptions from certification, licensure and other requirements
701.495
Residential locksmith services contractor license
701.501
Home services contractor license
701.505
Definitions for ORS 701.505 to 701.515
701.510
License required to engage in lead-based paint activity
701.515
Licensing system
701.520
Construction Contractors Board Lead-Based Paint Activities Fund
701.527
Definitions for ORS 702.527 to 701.536
701.529
Certification and licensing requirements
701.532
Home energy assessor certification
701.534
Home energy performance score contractors
701.536
Assessor and contractor exemption from testing and continuing education
701.540
Licensing
701.545
Provision of accessible features list to purchaser
701.547
Model list of accessibility features
701.550
Notice of Department of Consumer and Business Services rules regarding thermostats containing mercury
701.555
Barrier-type exterior insulation and finish systems
701.560
Definitions for ORS 701.560 to 701.595 and 701.605
701.565
Notice of defect requirement
701.570
Secondary notice of defect
701.575
Availability of residence
701.580
Offer by contractor, subcontractor or supplier
701.585
Effect of notice of defect on time for commencing court action
701.595
Failure to follow notice of defect procedure
701.600
Nonapplicability of ORS 701.560 to 701.595 and 701.605
701.605
Recording of written warranty agreement
701.620
Definitions for ORS 701.620 to 701.640
701.625
Progress payments
701.630
Payments to subcontractors and material suppliers
701.635
Suspension of performance
701.640
Prohibition against contrary provisions, covenants or clauses
701.645
Contracts and housing not subject to ORS 701.620 to 701.640
701.990
Criminal penalties
701.992
Civil penalties and other sanctions
701.995
Civil penalties for violations related to lead-based paint activities
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