9-17-113. Bonding requirements for vendors; qualifications of vendors; competitive bid requirement.

(a) Each vendor shall, at the execution of the contract with the corporation, post a performance bond or letter of credit from a bank or credit provider acceptable to the corporation in an amount as deemed necessary by the corporation for that particular bid or contract. In lieu of the bond, a vendor may, to assure the faithful performance of its obligations, deposit and maintain with the corporation securities that are interest bearing or accruing and that are rated in one (1) of the three (3) highest classifications by an established nationally recognized investment rating service. Securities eligible under this section are limited to:

(i) Certificates of deposit issued by solvent banks or savings associations approved by the corporation and which are organized and existing under the laws of this state or under the laws of the United States;

(ii) United States bonds, notes and bills for which the full faith and credit of the government of the United States is pledged for the payment of principal and interest; and

(iii) Corporate bonds approved by the corporation. The corporation which issued the bonds shall not be an affiliate or subsidiary of the depositor. The securities shall be held in trust and shall have at all times a market value at least equal to the full amount estimated to be paid annually to the lottery vendor under contract.

(b) Each vendor shall be qualified to do business in this state. All contracts under this chapter shall be governed by the laws of this state.

(c) No contract shall be let with any vendor in which a public official has an ownership interest of ten percent (10%) or more.

(d) All major procurement contracts shall be competitively bid pursuant to policies and procedures approved by the board unless:

(i) There is only one (1) qualified vendor and that vendor has an exclusive right to offer the service or product; or

(ii) The major procurement contract is an amendment, extension or renewal of an existing contract with terms that are not materially different than the terms of the existing contract.