CO SB181

Defines "building and construction contract" as any contract subject to mechanics' lien statutes, excluding public works contracts.

Voids any contract provision requiring Colorado construction work to be governed by another state's laws or resolved through out-of-state litigation, arbitration, or dispute resolution.

Voids any requirement that contractors, subcontractors, or material suppliers waive mechanics' lien rights or payment bond claims before receiving payment for labor or materials.

Requires principal contractors and subcontractors to pay subcontractors and material suppliers within 7 days of receiving undisputed service requests, with 1.5% monthly interest penalties for late payment and attorney fee awards for prevailing parties in collection actions.

Mandates monthly progress payments from property owners to contractors unless the contract specifies otherwise, limits retainage to 5% of progress payments, and allows owners to issue directed change orders with the contractor entitled to 50% of estimated costs during cost disputes.