Bill Text: FL S1056 | 2010 | Regular Session | Introduced
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Local Government Prompt Payment Act [CPSC]
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2010-04-27 - Placed on Special Order Calendar; Read 2nd time -SJ 00919; Amendment(s) adopted (495022, 482460) -SJ 00919; Substituted CS/HB 1157 -SJ 00919; Laid on Table, companion bill(s) passed, see CS/HB 1157 (Ch. 2010-111) -SJ 00919 [S1056 Detail]
Download: Florida-2010-S1056-Introduced.html
Bill Title: Local Government Prompt Payment Act [CPSC]
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2010-04-27 - Placed on Special Order Calendar; Read 2nd time -SJ 00919; Amendment(s) adopted (495022, 482460) -SJ 00919; Substituted CS/HB 1157 -SJ 00919; Laid on Table, companion bill(s) passed, see CS/HB 1157 (Ch. 2010-111) -SJ 00919 [S1056 Detail]
Download: Florida-2010-S1056-Introduced.html
Florida Senate - 2010 SB 1056 By Senator Baker 20-00916-10 20101056__ 1 A bill to be entitled 2 An act relating to the Local Government Prompt Payment 3 Act; amending s. 218.72, F.S.; revising definitions; 4 amending s. 218.735, F.S.; revising provisions 5 relating to the timely payment for purchases of 6 construction services; requiring that a dispute be 7 resolved according to procedures in the invitation to 8 bid or request for proposal; prohibiting the 9 assessment of damages against a contractor if the list 10 of items remaining to complete is not timely provided 11 to the contractor; amending s. 218.76, F.S.; revising 12 provisions relating to the resolution of disputes 13 concerning an improper payment request or invoice; 14 providing that a local governmental entity waives its 15 objection in a payment dispute if it fails to commence 16 the dispute resolution procedure within the time 17 required; providing an effective date. 18 19 Be It Enacted by the Legislature of the State of Florida: 20 21 Section 1. Section 218.72, Florida Statutes, is reordered 22 and amended to read: 23 218.72 Definitions.—As used in this part, the term: 24 (8)(1)“Proper invoice” means an invoice thatwhich25 conforms with all statutory requirements andwithall 26 requirementsthat have beenspecified by the local governmental 27 entity to which the invoice is submitted. Such requirements must 28 be included in the invitation to bid or request for proposal for 29 the project for which the invoice is submitted. 30 (5)(2)“Local governmental entity” means a county or 31 municipal government, school board, school district, authority, 32 special taxing district, other political subdivision, or any 33 office, board, bureau, commission, department, branch, division, 34 or institution thereof. 35 (4)(3)“County” means a political subdivision of the state 36 established pursuant to s. 1, Art. VIII of the State 37 Constitution. 38 (6)(4)“Municipality” means a municipality created pursuant 39 to general or special law and metropolitan and consolidated 40 governments as provided in s. 6(e) and (f), Art. VIII of the 41 State Constitution. 42 (9)(5)“Purchase” means the purchase of goods, services, or 43 construction services; the purchase or lease of personal 44 property; or the lease of real property by a local governmental 45 entity. 46 (10)(6)“Vendor” means any person who sells goods or 47 services, sells or leases personal property, or leases real 48 property directly to a local governmental entity. The term 49 includes any person who provides waste hauling services to 50 residents or businesses located within the boundaries of a local 51 government pursuant to a contract or local ordinance. 52 (2)(7)“Construction services” means all labor, services, 53 and materials provided in connection with the construction, 54 alteration, repair, demolition, reconstruction, oranyother 55 improvements to real property. 56 (7)(8)“Payment request” means a request for payment for 57 construction services which conforms with all statutory 58 requirements andwithall requirements specified by the local 59 governmental entity to which the payment request is submitted. 60 Such requirements must be included in the invitation to bid or 61 request for proposal for the project for which payment is 62 requested. 63 (1)(9)“Agent” means the project architect, project 64 engineer, oranyother agency or person acting on behalf of the 65 local governmental entity. The agent who is required to review 66 invoices or payment requests must be identified in the 67 invitation to bid or request for proposal for the project for 68 which payment requests or invoices are submitted. 69 (3)(10)“Contractor” or “provider of construction services” 70 means theanyperson who contracts directly with a local 71 governmental entity to provide construction services. 72 Section 2. Subsections (1) through (7) of section 218.735, 73 Florida Statutes, are amended to read: 74 218.735 Timely payment for purchases of construction 75 services.— 76 (1) The due date for payment for the purchase of 77 construction services by a local governmental entity is 78 determined as follows: 79 (a) If an agent must approve the payment request or invoice 80 beforeprior tothe payment request or invoice isbeing81 submitted to the local governmental entity, payment is due 25 82 business days after the date on which the payment request or 83 invoice is stamped as received as provided in s. 218.74(1). If 84 the payment request or invoice is not rejected before the due 85 date, it shall be deemed accepted. 86 (b) If an agent need not approve the payment request or 87 invoicewhich issubmitted by the contractor, payment is due 20 88 business days after the date on which the payment request or 89 invoice is stamped as received as provided in s. 218.74(1). 90 (2) If a payment request or invoice does not meet the 91 contract requirements, the local governmental entity mustmay92 reject the payment request or invoice within 20 business days 93 after the date on which the payment request or invoice is 94 stamped as received as provided in s. 218.74(1). The rejection 95 must be written and must specify the deficiencyin the payment96request or invoiceand the action necessary to make the payment 97 request or invoice proper. 98 (3) If a payment request or an invoice is rejected under 99 subsection (2) and the contractor submits acorrectedpayment 100 request or invoice thatwhichcorrects the deficiencyspecified101in writing by the local governmental entity, the corrected 102 payment request or invoice must be paid or rejected on the later 103 of: 104 (a) Ten business days after the date the corrected payment 105 request or invoice is stamped as received as provided in s. 106 218.74(1); or 107 (b) If the local governmental entitygoverning bodyis 108 required by ordinance, charter, or other law to approve or 109 reject the corrected payment request or invoice, the first 110 business day after the next regularly scheduled meeting of the 111 local governmental entitygoverning bodyheld after the 112 corrected payment request or invoice is stamped as received as 113 provided in s. 218.74(1). 114 (4) If a dispute between the local governmental entity and 115 the contractor cannot be resolved by the procedure in subsection 116 (3), the dispute must be resolved in accordance with the dispute 117 resolution procedure prescribed in the invitation to bid or 118 request for proposal for the project for which the payment 119 request or invoice is submittedconstruction contract or in any120applicable ordinance.In the absence of a prescribed procedure,121the dispute must be resolved by the procedure specified in s.122218.76(2).123 (5) If a local governmental entity disputes a portion of a 124 payment request or an invoice, the undisputed portion shall be 125 paid timely, in accordance with subsection (1). 126 (6) IfWhena contractor receives payment from a local 127 governmental entity for labor, services, or materials furnished 128 by subcontractors and suppliers hired by the contractor, the 129 contractor mustshallremit payment due to those subcontractors 130 and suppliers within 10 days after the contractor’s receipt of 131 payment. IfWhena subcontractor receives payment from a 132 contractor for labor, services, or materials furnished by 133 subcontractors and suppliers hired by the subcontractor, the 134 subcontractor mustshallremit payment due to those 135 subcontractors and suppliers within 7 days after the 136 subcontractor’s receipt of payment. This subsection does not 137Nothing herein shallprohibit a contractor or subcontractor from 138 disputing, pursuant to the terms of the relevant contract, all139orany portion of a payment alleged to be due to another party 140 if the contractor or subcontractor notifies the party whose 141 payment is disputed, in writing, of the amount in dispute and 142 the actions required to cure the dispute. The contractor or 143 subcontractor must pay all undisputed amounts due within the 144 time limits imposed by this section. 145 (7)(a)Each contract for construction services between a 146 local governmental entity and a contractor must provide for the 147 development of a single list of items required to render 148 complete, satisfactory, and acceptable the construction services 149 purchased by the local governmental entity. 150 (a) The contract must specify the process for developing 151the development ofthe list, including the responsibilities of 152 the local governmental entity and the contractor in developing 153 and reviewing the list and a reasonable time for developing the 154 list, as follows: 155 1. For construction projects having an estimated cost of 156 Less than $10 million, within 30 calendar days after reaching 157 substantial completion of the construction services purchased as 158 defined in the contract, or, if not defined in the contract, 159 upon reaching beneficial occupancy or use; or 160 2. For construction projects having an estimated cost of 161 $10 million or more, within 30 calendar days, or, ifunless162otherwiseextended by contract, up tonot to exceed60 calendar 163 days,after reaching substantial completion of the construction 164 services purchased as defined in the contract, or, if not 165 defined in the contract, upon reaching beneficial occupancy or 166 use. 167 (b) If the contract between the local governmental entity 168 and the contractor relates to the purchase of construction 169 services on more than one building or structure, or involves a 170 multiphased project, the contract must provide for the 171 development of a list of items required to render complete, 172 satisfactory, and acceptable all the construction services 173 purchased pursuant to the contract for each building, structure, 174 or phase of the project within the time limitations provided in 175 paragraph (a). 176 (c) The final contract completion date must be at least 30 177 days after the delivery of the list of items. If the list is not 178 timely provided to the contractor, the contract time for 179 completion must be extended by at least 30 days after the 180 contractor receives the list. Damages may not be assessed 181 against a contractor for failing to complete a project within 182 the time required by the contract if the list of items has not 183 been timely provided to the contractor. 184 (d)(c)The failure to include any corrective work or 185 pending items not yet completed on the list developedpursuant186to this subsectiondoes not alter the responsibility of the 187 contractor to complete all the construction services purchased 188 pursuant to the contract. 189 (e)(d)Upon completion of all items on the list, the 190 contractor may submit a payment request for all remaining 191 retainage withheld by the local governmental entity pursuant to 192 this section. If a good faith dispute exists as to whether one 193 or more items identified on the list have been completed 194 pursuant to the contract, the local governmental entity may 195 continue to withhold up toan amount not to exceed150 percent 196 of the total costs to complete such items. 197 (f)(e)All items that require correction under the contract 198 and that are identified after the preparation and delivery of 199 the list remain the obligation of the contractor as defined by 200 the contract. 201 (g)(f)Warranty items or items not included in the list of 202 items required under paragraph (a) may not affect the final 203 payment of retainage as provided in this section or as provided 204 in the contract between the contractor and its subcontractors 205 and suppliers. 206 (h)(g)Retainage may not be held by a local governmental 207 entity or a contractor to secure payment of insurance premiums 208 under a consolidated insurance program or series of insurance 209 policies issued to a local governmental entity or a contractor 210 for a project or group of projects, and the final payment of 211 retainage as provided in this section may not be delayed pending 212 a final audit by the local governmental entity’s or contractor’s 213 insurance provider. 214 (i)(h)If a local governmental entity fails to comply with 215 its responsibilities to develop the list required under 216 paragraph (a) or paragraph (b), as defined in the contract,217 within the time limitations provided in paragraph (a), the 218 contractor may submit a payment request for all remaining 219 retainage withheld by the local governmental entity pursuant to 220 this section and payment of any remaining contract amount must 221 be paid within 20 business days. If the local governmental 222 entity has provided written notice to the contractor specifying 223 the failure of the contractor to meet contract requirements in 224 the development of the list of items to be completed, the local 225 governmental entity need not pay or process any payment request 226 for retainage if the contractor has, in whole or in part, failed 227 to cooperate with the local governmental entity in the 228 development of the list,orfailed to perform its contractual 229 responsibilities, if any, with regard to the development of the 230 list, or if paragraph (8)(f) applies. 231 Section 3. Section 218.76, Florida Statutes, is amended to 232 read: 233 218.76 Improper payment request or invoice; resolution of 234 disputes.— 235 (1) IfIn any case in whichan improper payment request or 236 invoice is submitted by a vendor, the local governmental entity 237 shall, within 10 days after the improper payment request or 238 invoice is receivedby it, notify the vendor, in writing, that 239 the payment request or invoice is improper and indicate what 240 corrective action on the part of the vendor is needed to make 241 the payment request or invoice proper. 242 (2) IfIn the eventa dispute arisesoccursbetween a 243 vendor and a local governmental entity concerning payment of a 244 payment request oraninvoice, the disputesuch disagreement245 shall be finally determined by the local governmental entity 246 pursuant toas provided in this section. Each local governmental247entity shall establisha dispute resolution procedure 248 establishedto be followedby the local governmental entityin249cases of such disputes. Such procedure mustshallprovide that 250 proceedings to resolve the dispute areshall becommenced within 251not later than45 days after the dateon whichthe payment 252 request or proper invoice was received by the local governmental 253 entity andshall beconcluded by final decision of the local 254 governmental entity withinnot later than60 days after the date 255on whichthe payment request or proper invoice was received by 256 the local governmental entity. Such procedures areshallnotbe257 subject to chapter 120,and dosuch procedures shallnot 258 constitute an administrative proceeding thatwhichprohibits a 259 court from deciding de novo any action arising out of the 260 dispute. If the dispute is resolved in favor of the local 261 governmental entity,theninterest chargesshallbegin to accrue 262 15 days after the local governmental entity’s final decision. If 263 the dispute is resolved in favor of the vendor,theninterest 264 beginsshall beginto accrue as of the original date the payment 265 became due. If the local governmental entity does not commence 266 the dispute resolution procedure within the time required, the 267 objection to payment shall be deemed to have been waived. The 268 time for dispute resolution may be extended upon the written 269 agreement of the affected parties. 270 (3) In an action to recover amounts due under this partss.271218.70-218.80, the court shall award court costs and reasonable 272 attorney’s fees, including fees incurred throughanyappeal, to 273 the prevailing party, if the court finds that the nonprevailing274party withheld any portion of the payment that is the subject of275the action without any reasonable basis in law or fact to276dispute the prevailing party’s claim to those amounts. 277 Section 4. This act shall take effect July 1, 2010.