(a) In lieu of the retained amounts provided for in Code Section 32-2-75, the state is authorized to insert a clause in the specifications of all contracts let and awarded as a result of public lettings for the construction, improvement, maintenance, or repair of any road, highway, bridge, or appurtenance thereto providing for the maintenance of an escrow account in an amount at least equal to the amount of the retainage authorized by the contract, in accordance with such rules and regulations as are authorized to be promulgated by the state.

(b) Any such escrow agreement entered into pursuant to this Code section must contain as a minimum the following provisions:

(1) Only state or national banks chartered within this state may serve as an escrow agent;

(2) The escrow agent must limit the investment of funds of the contractor held in escrow in lieu of retained amounts provided for in Code Section 32-2-75 to negotiable certificates of deposits issued by any state or national bank in this state, including but not limited to certificates of deposit issued by the bank acting as escrow agent, registered in the name of the escrow agent as such under escrow agreement with the contractor;

(3) As interest on certificates of deposits held in escrow becomes due, it shall be collected by the escrow agent and paid to the contractor;

(4) The escrow agent shall promptly acknowledge to the treasurer of the department or the appropriate authority the amount and value of the escrow account held by the escrow agent, and any additions to the escrow account shall be reported immediately. Withdrawals from the escrow account shall only be made subject to the written approval of the treasurer of the department or the appropriate authority;

(5) Upon default or overpayment, as determined by the state, of any contract subject to this procedure and upon the written demand of the treasurer of the department or the appropriate authority, the escrow agent shall within ten days deliver a certified check to the treasurer of the department or the appropriate authority in the amount of the escrow account balance relating to the contract in default;

(6) The escrow account may be terminated upon completion and acceptance of the contract(s) as provided in Code Section 32-2-75;

(7) All fees and expenses of the escrow agent shall be paid by the contractor to the escrow agent and if not paid shall constitute a lien on the interest accruing to the escrow account and shall be paid therefrom;

(8) The escrow account shall constitute a specific pledge to the state, and the contractor shall not, except to his surety, otherwise assign, pledge, discount, sell, or transfer his interest in said escrow account, the funds in which shall not be subject to levy, garnishment, attachment, or any other process whatsoever; and

(9) The form of the escrow agreement and provisions thereof in compliance with this Code section as well as such other provisions as the treasurer of the department or the appropriate authority shall from time to time prescribe shall be subject to written approval of the treasurer of the department or the appropriate authority. The approval of the escrow agreement by the treasurer of the department or the appropriate authority shall authorize the escrow agent to accept appointment in such capacity.