Senate Bill 401 Summary

• Requires construction contracts for transportation projects to include mandatory progress payments made periodically to contractors, changing prior language that made such payments discretionary.

• Establishes a 14-day payment deadline for items with no exceptions raised, and requires the department to provide written notice within 30 days if exceptions are raised to any completed item.

• Mandates the department offer final payment within 45 days of receiving notice of completion, and requires actual payment of the final payment amount within 75 days regardless of pending disputes.

• Imposes a 0.75% monthly penalty on late payments for progress payments, final payments, and disputed amounts that remain unpaid beyond 75 days.

• Applies to all construction contracts entered into after January 1, 2012, and requires the department to adopt uniform prompt payment practices complying with these requirements.