Vote Smart's Synopsis:

Vote to pass a bill that requires private contractors working construction to be paid promptly.

Highlights:

• Specifies if a contractor submits a written request for payment to a private owner for an amount that is allowed to the contractor for properly performed work or furnished materials, performed or furnished under a contract with that private owner that was created after this amendment's effective date, the private owner will pay the amount to the contractor, less any amount withheld as authorized by law, as follows (Sec. 1.A-1):

• For work performed or materials furnished according to plans, drawings, specifications, or data submitted for approval to a municipal, township, or county building department, or the superintendent of industrial compliance, and requiring the seal of an architect or an engineer, 30 days after the work performed or materials furnished are certified as complying with the approved plans, drawings, specifications, or data by an architect or an engineer, or 30days after receiving the request, whichever is later;

• For all other work performed or materials furnished, thirty days after receiving the request:

• The private owner may reduce the amount paid by any retainage provision contained in the contract, invoice, or purchase order between the private owner and contractor, and may withhold amounts that may be necessary to resolve disputed liens or claims involving the work or labor performed or material furnished by the contractor; and

• If the private owner fails to comply, the private owner shall pay the contractor, in addition to the payment due, interest in the amount of 18% per annum of the payment due, beginning on the 31st day following the receipt of the payment request from the contractor to the private owner ending on the date of full payment of the payment due plus interest to the contractor.

• Specifies if a subcontractor or material supplier submits an application or request for payment or an invoice for materials to a contractor in sufficient time to allow the contractor to include the application, request, or invoice in the contractor's pay request submitted to an owner, the contractor, within ten calendar days after receipt of payment from the owner for improvements to property, shall pay to the (Sec. 1-2):

• Subcontractor, an amount that is equal to the percentage of completion of the subcontractor's contract allowed by the owner for the amount of labor or work performed;

• Material supplier, an amount that is equal to all or that portion of the invoice for materials that represents the materials furnished by the material supplier.

• Requires a contractor, subcontractor, or lower-tier subcontractor to pay laborer wages due within 10 days of payment of any application or request for payment or the receipt of any retainage from an owner, contractor, subcontractor, or lower-tier subcontractor (Sec. 1-6).

• Specifies if the court finds in the civil action that the person owing payment has not made payment in compliance with this law, the court will award the interest specified in that division, in addition to the amount due. The court will award the prevailing party reasonable attorney fees and court costs (Sec. 1-6.B-1).

• Requires the court to consider all relevant factors in deciding to award attorney fees, including but not limited to the following (Sec. 1-6.B-2):

• The presence or absence of good faith allegations or defenses asserted by the parties;

• The proportion of the amount of recovery as it relates to the amount demanded;

• The nature of the services rendered and the time expended in rendering the services.

• Prohibits this law from being construed as impairing or affecting, in any way, the terms and conditions of any contract, invoice, purchase order, or any other agreement between a any of the following (Sec. 1-6.D-2):

• An owner and a contractor;

• A contractor and a subcontractor or a material supplier; or

• A subcontractor and another subcontractor, a material supplier, a lower-tier subcontractor, or a lower-tier material supplier.

Full Bill Text