The contract may permit progress payments, but an amount necessary to complete the improvement shall be retained from the final payment until the contract is executed in full and the public improvement completed to the satisfaction and acceptance of the purchasing agency. However, if the contractor has furnished the purchasing agency all required records and reports and a final inspection has been made, the purchasing agency shall pay to the contractor interest as set by the governing body at a rate of not less than the category E rate of interest as established by § 54-3-16 on the amounts retained and on the final payment due the contractor beginning thirty days after the work under the contract has been completed, as evidenced either by the completion date established by the architect’s or engineer’s letter of acceptance or by the use and occupancy of the public improvement. The interest shall continue until the date when payment is tendered to the contractor unless delay in payment has been the result of federal participation in the contract in which event interest may not begin until thirty days after payment by the federal authority involved. If a portion of a progress payment is retained, other than the final payment, the purchasing agency shall pay to the contractor interest as set by the purchasing agency at a rate of not less than the category E rate of interest as established by § 54-3-16 on the amount retained beginning thirty days after the contractor has furnished the purchasing agency with all required records and reports and a progress inspection.

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Source: SL 2010, ch 31, § 50.