35-155

35-155. Cash deposit as an alternative to a
surety bond

A. Any budget unit which requires a person to post a surety bond to guarantee the
faithful performance of a legal obligation may accept, in lieu of the surety bond, a cash
deposit in the form of cash or alternatives to cash. The budget unit may accept as an
alternative to cash any of the following:

1. Certificates of deposit or investment certificates payable or assigned to the
state treasurer issued by banks doing business in this state and insured by the federal
deposit insurance corporation.

2. Certificates of deposit, investment certificates or share accounts payable or
assigned to the state treasurer and issued by a savings and loan association doing
business in this state and insured by the federal savings and loan insurance corporation.

3. Certificates of deposit, investment certificates or share accounts payable or
assigned to the state treasurer and issued by a credit union doing business in this state
and insured by the national credit union administration.

B. The budget unit shall deposit the cash deposit received under this section with
the state treasurer. The state treasurer shall hold the cash or alternatives to cash in
the name of this state to guarantee the faithful performance of all legal obligations of
the person required to post the bond. The person is entitled to receive any accrued
interest earned from the alternatives to cash. The state treasurer may impose a fee to
reimburse the state treasurer for administrative expenses. The fee shall not exceed ten
dollars for each cash deposit.

C. A person depositing cash in lieu of a surety bond may withdraw the deposit upon
satisfactory performance of the legal obligation or upon replacing the cash deposit with
a commercial surety bond.

D. The budget unit and the state treasurer have no personal liability for the
performance of duties relating to the cash deposits permitted by this section as long as
those duties are performed in good faith.

E. The state treasurer may prescribe rules relating to the terms and conditions of
each type of security provided by this section.