New York Laws
Article 3 - State Highways
38 - Contracts for Construction or Improvement of Highways.

(c) Whenever a contract shall in the judgment of the commissioner of
transportation be substantially completed, the commissioner of
transportation may, provided the regional director certifies that the
essential items in the contract have been completed in accordance with
the terms of the contract and the provisions of this chapter, direct the
regional director to include in the final account such uncompleted items
and pay therefor at the item prices in the contract upon the contractor
depositing with the commissioner of transportation a certified check
drawn upon a legally incorporated bank or trust company equal to at
least double the value of such uncompleted work or, with the approval of
the state comptroller, securities as are listed in subdivision three of
section one hundred thirty-nine of the state finance law, equal to at
least double the value of such uncompleted work. The deposit may be used
by the commissioner of transportation to complete the uncompleted
portion of the contract and shall be returned to the contractor if he
completes the uncompleted portion within a specified number of working
days after he has been notified to proceed with the work.
(d) No certificates approving or authorizing a partial or final
payment shall be made by the commissioner of transportation until he is
satisfied that all laborers employed on the work have been paid for
their services for the last payroll period preceding the said partial or
final payment. The commissioner of transportation may, if he deems
necessary, require an affidavit to such effect from the contractor or he
may depend on any other source which he deems proper for such
information.
(e) No such certificate approving or authorizing the first partial
payment or any final payment to a foreign contractor shall be made
unless such contractor shall furnish satisfactory proof that all taxes
due the state tax commission by such contractor, under the provisions of
or pursuant to a law enacted pursuant to the authority of article nine,
nine-a, twelve-a, sixteen, sixteen-a, twenty-one, twenty-two,
twenty-three, twenty-eight, twenty-nine or thirty of the tax law or
article two-E of the general city law have been paid. The certificate of
the state tax commission to the effect that all such taxes have been
paid shall be, for purpose of this paragraph, conclusive proof of the
payment of such taxes. The term "foreign contractor" as used in this
subdivision means, in the case of an individual, a person who is not a
resident of this state, in the case of a partnership, one having one or
more partners not a resident of this state, and in the case of a
corporation, one not organized under the laws of this state.
(f) Payment of the moneys due under a contract shall be made in
accordance with the provisions of article eleven-A of the state finance

law, provided failure to make such payment, as heretofore prescribed,
shall not be due to any fault, neglect, or omission on the part of the
contractor or by reason of the filing of any lien, attachment, or other
legal process against the money due said contractor.
(g) For the purpose of making a final payment on a highway
construction contract, the date to be used for determining the receipt
of an invoice in subdivision two of section one hundred seventy-nine-f
of the state finance law shall be the date on which the contract work
has been accepted as completed by the commissioner of transportation.
8. Contingencies and extra work. Whenever the commissioner of
transportation determines that from any unforeseen cause the terms of
any contract should be altered to provide for contingencies or extra
work, he may, if funds are available for payment of the cost thereof,
issue an order on contract therefor to the contractor, a copy of which
shall be filed with the director of the budget and the state
comptroller. The estimated expenditure pursuant to the order on contract
shall not increase the total amount of the primary contract until the
estimated expenditure shall have been approved by the commissioner of
transportation and a duplicate of such approval shall have been filed
with the comptroller. No such extra work shall be commenced or
undertaken until the commissioner of transportation has issued an order
on contract as herein provided.
When such order on contract provides for similar items of work or
materials which increase or decrease the itemized quantity provided for
in the primary contract, the price to be paid therefor shall not exceed
the unit bid price in the primary contract for such items. Agreed prices
for new items of work or materials may be incorporated in the order on
contract as the commissioner of transportation may deem them to be just
and fair and beneficial to the state.
Whenever the commissioner of transportation also determines that in
the cases herein provided it is impracticable for him to ascertain in
advance the just and fair price to be paid by the state for new items of
work or materials, the order on contract therefor may provide for
performance of the work and the furnishing of the materials and
equipment, in which event the contractor shall keep and shall make
available at all times to the commissioner of transportation such
accounting records, data and procedure as may be required by the
commissioner of transportation. An estimate of the value of such work
and the furnishing of materials and equipment shall be submitted by the
commissioner of transportation to the state comptroller who is hereby
empowered to approve such estimate. Partial and final payments shall be
made upon proper records and data itemized as hereinbefore indicated.
Before any final accounting shall become effective, a supplemental
contract and final agreement shall first be approved by the comptroller,
and filed in his office. The director of the budget may at his
discretion require the commissioner of transportation to submit periodic
summaries of and reports on the scope and status of highway projects in
such form and at such intervals as he may require, including any and all
contract documents.
9. Adjustment of disputes. Notwithstanding the provisions of any
general or special law, and in case of a dispute between a contractor
and the commissioner of transportation concerning questions of fact
which may arise under a contract, the contractor may, at any time before
the final estimate is rendered, petition the commissioner of
transportation for a hearing in relation thereto, provided (1) the
amount involved therein as shown by such petition does not exceed five
thousand dollars or five per centum of the final estimate of the
completed contract, whichever is greater, (2) the contractor has

complied with all provisions of the contract that relate to the filing
of any protest and also of any statement concerning the subject-matter
thereof, and (3) the contractor shall expressly agree in such petition
that any determination as hereinafter provided, shall be final and
conclusive upon all parties thereto. If the commissioner of
transportation grants such petition, he shall, within a reasonable time,
mail a notice to the contractor which shall specify the place of such
hearing and the date thereof which shall be within thirty days after the
mailing of such notice. Within ten days after such mailing, the
commissioner of transportation shall also mail a copy of the petition
and of such notice of hearing to the attorney general, who together with
the commissioner of transportation, shall constitute a board to (a) hear
such dispute, either personally or by any duly authorized officer or
employee of their respective departments, and (b) determine the issues
thereof.
Any amount fixed in the determination to be paid to the contractor
shall be deemed to be a special item to be incorporated in a final
supplemental contract and shall be payable from monies available for
construction and reconstruction of state highways, on the audit and
warrant of the comptroller on vouchers approved by the commissioner of
transportation.