HB 987 Summary

• Reduces payment deadline for government contractors from 30 calendar days to 15 calendar days following receipt of statement or satisfactory delivery of goods/services.

• Establishes interest penalty on unpaid balances beginning on the sixteenth day (instead of thirtieth day) at a rate equal to prime rate plus 2 percent per calendar quarter if payment is delayed.

• Requires that all checks must be dispersed no later than 45 calendar days following receipt of the statement or satisfactory delivery of goods/services.

• Applies to contractors providing goods or services to any State of Hawaii agency or county government.

• Addresses concerns raised by nonprofits and small businesses that experienced late payments from government entities, with Hawaii nonprofits reporting 50% late payment problems compared to 41% national average.