Senate Bill sb0544
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Florida Senate - 2004 SB 544
By Senator Bennett
21-239C-04
1 A bill to be entitled
2 An act relating to construction services;
3 amending s. 218.70, F.S.; providing a short
4 title; amending s. 218.72, F.S.; redefining
5 terms used in part VII of ch. 218, F.S.;
6 amending s. 218.735, F.S.; revising provisions
7 relating to timely payment for purchases of
8 construction services; revising deadlines for
9 payment; providing procedures for project
10 closeout and payment of retainage; providing
11 requirements for local government construction
12 retainage; providing that ss. 218.72-218.76,
13 F.S., apply to the payment of any payment
14 request for retainage; creating s. 255.0705,
15 F.S.; providing a short title; amending s.
16 255.071, F.S.; revising deadlines for the
17 payment of subcontractors, sub-subcontractors,
18 materialmen, and suppliers on construction
19 contracts for public projects; creating ss.
20 255.072, 255.073, 255.074, 255.075, 255.076,
21 255.077, and 255.078, F.S.; providing
22 definitions; providing for timely payment for
23 purchases of construction services by a public
24 entity; providing procedures for calculating
25 payment due dates; providing procedures for
26 handling improper payment requests; providing
27 for the resolution of disputes; providing for
28 payment of court costs and attorney's fees;
29 providing for project closeout and payment of
30 retainage; providing for public-construction
31 retainage; providing that ss. 255.072-255.076,
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1 F.S., apply to the payment of any payment
2 request for retainage; amending s. 255.05,
3 F.S.; providing requirements for certain
4 notices of nonpayment served by a claimant who
5 is not in privity with the contractor;
6 providing limitations on a claimant's
7 institution of certain actions against a
8 contractor or surety; providing for certain
9 notices to the claimant; creating s. 725.09,
10 F.S.; prohibiting the inclusion in a contract
11 for the purchase of construction materials or
12 services a provision that conditions payment
13 for such materials or services on the receipt
14 of payment from any other entity; providing an
15 effective date.
16
17 Be It Enacted by the Legislature of the State of Florida:
18
19 Section 1. Section 218.70, Florida Statutes, is
20 amended to read:
21 218.70 Short title.--This part may be cited as the
22 "Local Government Florida Prompt Payment Act."
23 Section 2. Subsections (2), (6), and (7) of section
24 218.72, Florida Statutes, are amended to read:
25 218.72 Definitions.--As used in this part:
26 (2) "Local governmental entity" means a county or
27 municipal government, school board, school district,
28 authority, special taxing district, other political
29 subdivision, community college, or any office, board, bureau,
30 commission, department, branch, division, or institution
31 thereof or any project supported by county or municipal funds.
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1 (6) "Vendor" means any person who sells goods or
2 services, sells or leases personal property, or leases real
3 property directly to a local government entity. The term
4 includes any person who provides waste-hauling services to
5 residents or businesses located within the boundaries of a
6 local government pursuant to a contract or local ordinance.
7 (7) "Construction services" means all labor, services,
8 and materials provided in connection with the construction,
9 alteration, repair, demolition, reconstruction, or any other
10 improvements to real property that require a license under
11 parts I and II of chapter 489.
12 Section 3. Subsection (6) of section 218.735, Florida
13 Statutes, is amended, present subsection (7) of that section
14 is redesignated as subsection (9), and new subsections (7) and
15 (8) are added to that section, to read:
16 218.735 Timely payment for purchases of construction
17 services.--
18 (6) When a contractor receives payment from a local
19 governmental entity for labor, services, or materials
20 furnished by subcontractors and suppliers hired by the
21 contractor, the contractor shall remit payment due to those
22 subcontractors and suppliers within 10 15 days after the
23 contractor's receipt of payment. When a subcontractor receives
24 payment from a contractor for labor, services, or materials
25 furnished by subcontractors and suppliers hired by the
26 subcontractor, the subcontractor shall remit payment due to
27 those subcontractors and suppliers within 10 15 days after the
28 subcontractor's receipt of payment. Nothing herein shall
29 prohibit a contractor or subcontractor from disputing,
30 pursuant to the terms of the relevant contract, all or any
31 portion of a payment alleged to be due to another party. In
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1 the event of such a dispute, the contractor or subcontractor
2 may withhold the disputed portion of any such payment if the
3 contractor or subcontractor notifies the party whose payment
4 is disputed, in writing, of the amount in dispute and the
5 actions required to cure the dispute. The contractor or
6 subcontractor must pay all undisputed amounts due within the
7 time limits imposed by this section.
8 (7)(a) Each contract for construction services between
9 a local government entity and vendor must provide for the
10 development of a list of items required to render complete,
11 satisfactory, and acceptable the construction services
12 purchased by the local government. The contract must specify
13 the process for the development of the list, including the
14 respective responsibilities of the local government and the
15 vendor in developing and reviewing the list and a reasonable
16 time for developing the list as follows:
17 1. For construction projects with an estimated cost of
18 less than $10 million, within 30 days after reaching
19 substantial completion of the construction services purchased
20 as defined in the contract, or, if not defined in the
21 contract, upon reaching beneficial occupancy or use; or
22 2. For construction projects with an estimated cost of
23 $10 million or more, within 30 days, unless otherwise extended
24 by contract not to exceed 90 days, after reaching substantial
25 completion of the construction services purchased as defined
26 in the contract, or, if not defined in the contract, upon
27 reaching beneficial occupancy or use.
28 (b) If the contract between the local government
29 entity and vendor relates to the purchase of construction
30 services on more than one building or structure or involves a
31 multiphased project, the contract must provide for the
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1 development of a list of items required to render complete,
2 satisfactory, and acceptable the construction services
3 purchased for each building, structure, or phase of the
4 project in accordance with the timeframes specified in
5 subparagraph (a)1. or subparagraph (a)2.
6 (c) The failure to include any corrective work or
7 pending items not yet completed on the list developed pursuant
8 to this subsection does not alter the responsibility of the
9 vendor to complete all the purchased construction services as
10 defined in the contract.
11 (d) Upon completion of all items on the list, or such
12 other time as defined in the contract, the vendor may submit a
13 payment request for the appropriate amount of retainage. The
14 local government may withhold an amount not to exceed 150
15 percent of the total costs to complete any incomplete items on
16 the list.
17 (e) All items that require correction under the
18 contract and that are identified after the preparation and
19 delivery of the list remain the obligation of the vendor as
20 defined by the contract.
21 (f) Warranty items may not affect the final payment of
22 retainage as provided in this section or as provided in the
23 contract between the vendor and its subcontractors and
24 suppliers.
25 (g) Retainage may not be held by a local governmental
26 entity or a vendor to secure payment of insurance premiums
27 under a consolidated insurance program or series of insurance
28 policies issued to a public agency or a contractor for a
29 project or group of projects, and the final payment of
30 retainage as provided in this section may not be delayed
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1 pending a final audit by the local governmental entity's or
2 vendor's insurance provider.
3 (h) If a local government entity fails to comply with
4 its responsibilities to develop the list required under
5 paragraph (a) or paragraph (b), as defined in the contract,
6 and the timeframes provided in subparagraph (a)1. or
7 subparagraph (a)2., the vendor may submit a payment request
8 for the appropriate amount of retainage. The local government
9 entity need not pay or process any request for payment of
10 retainage if the vendor has, in whole or in part, failed to
11 cooperate with the local government in the development of the
12 list or failed to perform its contractual responsibilities, if
13 any, with regard to the development of the list or if
14 paragraph (8)(d) applies.
15 (8)(a) In any public construction project, a local
16 government entity may withhold an amount not exceeding 10
17 percent of each progress payment made to the vendor until the
18 local government project has reached 50-percent completion.
19 After the project has reached 50-percent completion, the local
20 government must reduce to 5 percent the amount of retainage
21 withheld from each subsequent progress payment made to the
22 vendor. However, notwithstanding the provisions of this
23 subsection, a municipality with a population of 25,000 or
24 fewer, or a county with a population of 100,000 or fewer, may
25 withhold retainage in an amount not exceeding 10 percent of
26 each progress payment made to the vendor until final
27 completion and acceptance of the project by the local
28 government. For purposes of this subsection, the term
29 "50-percent completion" means as defined in the contract
30 between the local government entity and the vendor, or, if not
31 defined in the contract, the point at which the local
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1 government has expended 50 percent of the total project costs
2 identified in the contract, plus all change orders and other
3 additions issued subsequent to the approval of the contract by
4 the governing body of the local government, and the level of
5 actual project construction is equivalent to such expenditure
6 of funds.
7 (b) After the project has reached 50-percent
8 completion, the vendor may present to the local government
9 entity a payment request for up to one-half of the retainage
10 amount held by the local government. The local government
11 entity shall promptly make payment to the vendor, unless the
12 local government has grounds, pursuant to the contract or as
13 provided in paragraph (d), for withholding the payment of
14 retainage. If the local government makes payment of retainage
15 to the vendor under this paragraph, the vendor shall timely
16 remit payment of such retainage to the appropriate
17 subcontractors and suppliers.
18 (c) After the project has reached 50-percent
19 completion, the vendor may elect to withhold retainage from
20 payments to its subcontractors at a rate higher than 5
21 percent. The specific amount to be withheld must be determined
22 on a case-by-case basis and must be based on the vendor's
23 assessment of the subcontractor's past performance, the
24 likelihood that such performance will continue, and the
25 vendor's ability to rely on other safeguards. The vendor shall
26 notify the subcontractor, in writing, of its determination to
27 withhold more than 5 percent of the progress payment and the
28 reasons for making that determination, and the vendor may not
29 request the release of such retained funds from the local
30 government.
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1 (d) This section does not require the local government
2 to pay or release any amounts that are the subject of a
3 good-faith dispute, the subject of an action brought under s.
4 255.05, or otherwise the subject of a claim or demand by the
5 local government or vendor.
6 (e) The timeframes set forth in this section for
7 payment of payment requests apply to any payment request for
8 retainage made pursuant to this subsection.
9 Section 4. Section 255.0705, Florida Statutes, is
10 created to read:
11 255.0705 Short title.--Sections 255.0705-255.078 may
12 be cited as the "Florida Prompt Payment Act."
13 Section 5. Subsections (2) and (3) of section 255.071,
14 Florida Statutes, are amended to read:
15 255.071 Payment of subcontractors, sub-subcontractors,
16 materialmen, and suppliers on construction contracts for
17 public projects.--
18 (2) The failure to pay any undisputed obligations for
19 such labor, services, or materials within 30 days after the
20 date the labor, services, or materials were furnished and
21 payment for such labor, services, or materials became due, or
22 within 10 30 days after the date payment for such labor,
23 services, or materials is received, whichever last occurs,
24 shall entitle any person providing such labor, services, or
25 materials to the procedures specified in subsection (3) and
26 the remedies provided in subsection (4).
27 (3) Any person providing labor, services, or materials
28 for the construction of a public building, for the prosecution
29 and completion of a public work, or for repairs upon a public
30 building or public work improvements to real property may file
31 a verified complaint alleging:
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1 (a) The existence of a contract for providing such
2 labor, services, or materials to improve real property.
3 (b) A description of the labor, services, or materials
4 provided and alleging that the labor, services, or materials
5 were provided in accordance with the contract.
6 (c) The amount of the contract price.
7 (d) The amount, if any, paid pursuant to the contract.
8 (e) The amount that remains unpaid pursuant to the
9 contract and the amount thereof that is undisputed.
10 (f) That the undisputed amount has remained due and
11 payable pursuant to the contract for more than 30 days after
12 the date the labor or services were accepted or the materials
13 were received.
14 (g) That the person against whom the complaint was
15 filed has received payment on account of the labor, services,
16 or materials described in the complaint more than 10 30 days
17 prior to the date the complaint was filed.
18 Section 6. Section 255.072, Florida Statutes, is
19 created to read:
20 255.072 Definitions.--As used in ss. 255.073-255.078,
21 the term:
22 (1) "Agent" means project architect, project engineer,
23 or any other agency or person acting on behalf of a public
24 entity.
25 (2) "Construction services" means all labor, services,
26 and materials provided in connection with the construction,
27 alteration, repair, demolition, reconstruction, or any other
28 improvements to real property. The term "construction
29 services" does not include contracts or work performed for the
30 Department of Transportation.
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1 (3) "Payment request" means an invoice or request for
2 payment for construction services which conforms with all
3 statutory requirements and with all requirements specified by
4 the public entity to which the payment request is submitted.
5 (4) "Public entity" means the state, a state
6 university, or any office, board, bureau, commission,
7 department, branch, division, or institution thereof, or any
8 project supported by state funds, but does not include a local
9 government entity as defined in s. 218.72.
10 (5) "Purchase" means the purchase of construction
11 services.
12 (6) "Vendor" means any person providing construction
13 services directly to a public entity.
14 Section 7. Section 255.073, Florida Statutes, is
15 created to read:
16 255.073 Timely payment for purchases of construction
17 services.--
18 (1) Except as otherwise provided in ss.
19 255.072-255.078, s. 215.422 governs the timely payment for
20 construction services by a public entity under this act.
21 (2) If a public entity disputes a portion of a payment
22 request, the undisputed portion must be timely paid, in
23 accordance with subsection (1).
24 (3) When a vendor receives payment from a public
25 entity for labor, services, or materials furnished by
26 subcontractors and suppliers hired by the vendor, the vendor
27 shall remit payment due to those subcontractors and suppliers
28 within 10 days after the vendor's receipt of payment. When a
29 subcontractor receives payment from a vendor for labor,
30 services, or materials furnished by subcontractors and
31 suppliers hired by the subcontractor, the subcontractor shall
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1 remit payment due to those subcontractors and suppliers within
2 10 days after the subcontractor's receipt of payment. This
3 subsection does not prohibit a vendor or subcontractor from
4 disputing, pursuant to the terms of the relevant contract, all
5 or any portion of a payment alleged to be due to another
6 party. If such a dispute occurs, the vendor or subcontractor
7 may withhold the disputed portion of any such payment if the
8 vendor or subcontractor notifies the party whose payment is
9 disputed, in writing, of the amount in dispute and the actions
10 required to cure the dispute. The vendor or subcontractor must
11 pay all undisputed amounts due within the time limits imposed
12 by this section.
13 (4) All payments due under this section and not made
14 within the time periods specified by this section shall bear
15 interest at the rate of 1 percent per month, or the rate
16 specified by contract, whichever is greater.
17 Section 8. Section 255.074, Florida Statutes, is
18 created to read:
19 255.074 Procedures for calculation of payment due
20 dates.--
21 (1) Each public entity shall establish procedures
22 whereby each payment request received by the public entity is
23 marked as received on the date on which it is delivered to an
24 agent or employee of the public entity or of a facility or
25 office of the public entity.
26 (2) If the terms under which a purchase is made allow
27 for partial deliveries and a payment request is submitted for
28 a partial delivery, the time for payment for the partial
29 delivery must be calculated from the time of the partial
30 delivery and the submission of the payment request in the same
31 manner as provided in s. 255.073.
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1 (3) The public entity must submit a payment request to
2 the Chief Financial Officer for payment no more than 25 days
3 after receipt of the payment request.
4 Section 9. Section 255.075, Florida Statutes, is
5 created to read:
6 255.075 Mandatory interest.--A contract between a
7 public entity and a vendor or a provider of construction
8 services may not prohibit the collection of late payment
9 interest charges allowable under ss. 255.072-255.078.
10 Section 10. Section 255.076, Florida Statutes, is
11 created to read:
12 255.076 Improper payment request; resolution of
13 disputes.--
14 (1) If a vendor submits an improper payment request,
15 the public entity shall, within 10 days after receiving the
16 improper payment request, notify the vendor that the payment
17 request is improper and indicate what corrective action on the
18 part of the vendor is needed to make the payment request
19 proper.
20 (2) If a dispute occurs between a vendor and a public
21 entity concerning payment of a payment request, the dispute
22 must be resolved as provided in this section. Each public
23 entity shall establish a dispute resolution procedure to be
24 followed by the public entity if such a dispute occurs. The
25 procedure must provide that proceedings to resolve the dispute
26 must commence not later than 45 days after the date on which
27 the public entity received the payment request and must
28 conclude by final decision of the public entity not later than
29 60 days after the date on which the public entity received the
30 payment request. Such procedures are not subject to chapter
31 120 and do not constitute an administrative proceeding that
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1 prohibits a court from deciding de novo any action arising out
2 of the dispute. If the dispute is resolved in favor of the
3 public entity, interest charges begin to accrue 15 days after
4 the public entity's final decision. If the dispute is resolved
5 in favor of the vendor, interest begins to accrue as of the
6 original date the payment became due.
7 (3) In an action to recover amounts due under ss.
8 255.072-255.078, the court shall award court costs and
9 reasonable attorney's fees, including fees incurred through
10 any appeal, to the prevailing party, if the court finds that
11 the nonprevailing party withheld any portion of the payment
12 that is the subject of the action without any reasonable basis
13 in law or fact to dispute the prevailing party's claim to
14 those amounts.
15 Section 11. Section 255.077, Florida Statutes, is
16 created to read:
17 255.077 Project closeout and payment of retainage.--
18 (1) Each contract for construction services between a
19 public entity and a vendor must provide for the development of
20 a list of items required to render complete, satisfactory, and
21 acceptable the construction services purchased by the public
22 entity. The contract must specify the process for the
23 development of the list, including the respective
24 responsibilities of the public entity and the vendor in
25 developing and reviewing the list. The list must be developed
26 within 30 days after substantial completion of the
27 construction services purchased, as defined in the contract,
28 or, if not defined in the contract, within 30 days after
29 beneficial occupancy or use of the project.
30 (2) If the contract between the public entity and the
31 vendor relates to the purchase of construction services on
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1 more than one building or structure or involves a multiphased
2 project, the contract must provide for the development of a
3 list of items required to render complete, satisfactory, and
4 acceptable the construction services purchased for each
5 building, structure, or phase of the project. Each list must
6 be developed within 30 days after substantial completion of
7 the construction services purchased, as defined in the
8 contract, for each building, structure, or phase of the
9 project, or, if not defined in the contract, within 30 days
10 after beneficial occupancy or use of each building, structure,
11 or phase of the project.
12 (3) The failure to include any corrective work or
13 pending items not yet completed on the list developed under
14 this section does not alter the responsibility of the vendor
15 to complete all the purchased construction services as defined
16 in the contract.
17 (4) Upon completion of all items on the list, or at
18 such other time as defined in the contract, the vendor may
19 submit a payment request for the appropriate amount of
20 retainage. The public entity may withhold an amount not to
21 exceed 150 percent of the total costs to complete any
22 incomplete items on the list.
23 (5) All items that require correction under the
24 contract and that are identified after the preparation and
25 delivery of the list remain the obligation of the vendor as
26 defined by the contract.
27 (6) Warranty items may not affect the final payment of
28 retainage as provided in this section or as provided in the
29 contract between the vendor and its subcontractors and
30 suppliers.
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1 (7) Retainage may not be held by a public entity or a
2 vendor to secure payment of insurance premiums under a
3 consolidated insurance program or series of insurance policies
4 issued to a public agency or a contractor for a project or
5 group of projects, and the final payment of retainage as
6 provided in this section may not be delayed pending a final
7 audit by the public entity's or vendor's insurance provider.
8 (8) If a public entity fails to comply with its
9 responsibilities to develop the list required under subsection
10 (1) or subsection (2), the vendor may submit a payment request
11 for the appropriate amount of retainage. The public entity
12 need not pay or process any request for payment of retainage
13 if the vendor has, in whole or in part, failed to cooperate
14 with the public entity in the development of the list or
15 failed to perform its contractual responsibilities, if any,
16 with regard to the development of the list.
17 Section 12. Section 255.078, Florida Statutes, is
18 created to read:
19 255.078 Public construction retainage.--
20 (1) In any public construction project that is subject
21 to ss. 255.072-255.078, a public entity may withhold an amount
22 not exceeding 10 percent of each progress payment made to the
23 vendor until the project has reached 50-percent completion.
24 After the project has reached 50-percent completion, the
25 public entity must reduce to 5 percent the amount of retainage
26 withheld from each subsequent progress payment made to the
27 vendor. As used in this section, the term "50-percent
28 completion" means as defined in the contract between the
29 public entity and the vendor, or, if not defined in the
30 contract, the point at which the public entity has expended 50
31 percent of the amount of the total project costs identified in
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1 the contract, plus all change orders and other additions
2 issued after the approval of the contract by the public
3 entity, and the level of actual project construction is
4 equivalent to such expenditure of funds.
5 (2) After the project has reached 50-percent
6 completion, the vendor may present to the public entity a
7 payment request for up to one-half of the retainage amount
8 held by the public entity. The public entity shall promptly
9 make payment to the vendor unless the public entity has
10 grounds, under the contract or as provided in subsection (4),
11 for withholding the payment of retainage. If the public entity
12 makes payment of retainage to the vendor under this
13 subsection, the vendor shall timely remit payment of such
14 retainage to the appropriate subcontractors and suppliers.
15 (3) After the project has reached 50-percent
16 completion, the vendor may elect to withhold retainage from
17 payments to its subcontractors at a rate higher than 5
18 percent. The specific amount to be withheld must be determined
19 on a case-by-case basis and must be based on the vendor's
20 assessment of the subcontractor's past performance, the
21 likelihood that such performance will continue, and the
22 vendor's ability to rely on other safeguards. The vendor shall
23 notify the subcontractor, in writing, of its determination to
24 withhold more than 5 percent of the progress payment and the
25 reasons for making that determination, and the vendor may not
26 request the release of such withheld funds from the public
27 entity.
28 (4) This section does not require the public entity to
29 pay or release any amounts that are the subject of a
30 good-faith dispute, the subject of an action brought under s.
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1 255.05, or otherwise the subject of a claim or demand by the
2 public entity or vendor.
3 (5) The timeframes set forth in ss. 255.072-255.076
4 for payment of payment requests apply to any payment request
5 for retainage made pursuant to this section.
6 Section 13. Paragraph (a) of subsection (2) of section
7 255.05, Florida Statutes, is amended, and subsections (10) and
8 (11) are added to that section, to read:
9 255.05 Bond of contractor constructing public
10 buildings; form; action by materialmen.--
11 (2)(a)1. If a claimant is no longer furnishing labor,
12 services, or materials on a project, a contractor or the
13 contractor's agent or attorney may elect to shorten the
14 prescribed time in this paragraph within which an action to
15 enforce any claim against a payment bond provided pursuant to
16 this section may be commenced by recording in the clerk's
17 office a notice in substantially the following form:
18
19 NOTICE OF CONTEST OF CLAIM
20 AGAINST PAYMENT BOND
21
22 To: ...(Name and address of claimant)...
23
24 You are notified that the undersigned contests your
25 notice of nonpayment, dated ............, ........, and served
26 on the undersigned on ............, ........, and that the
27 time within which you may file suit to enforce your claim is
28 limited to 60 days after the date of service of this notice.
29
30 DATED on ............, .........
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1 Signed:...(Contractor or Attorney)...
2
3 The claim of any claimant upon whom such notice is served and
4 who fails to institute a suit to enforce his or her claim
5 against the payment bond within 60 days after service of such
6 notice shall be extinguished automatically. The clerk shall
7 mail a copy of the notice of contest to the claimant at the
8 address shown in the notice of nonpayment or most recent
9 amendment thereto and shall certify to such service on the
10 face of such notice and record the notice. Service is complete
11 upon mailing.
12 2. A claimant, except a laborer, who is not in privity
13 with the contractor shall, before commencing or not later than
14 45 days after commencing to furnish labor, materials, or
15 supplies for the prosecution of the work, furnish the
16 contractor with a notice that he or she intends to look to the
17 bond for protection. A claimant who is not in privity with the
18 contractor and who has not received payment for his or her
19 labor, materials, or supplies shall deliver to the contractor
20 and to the surety written notice of the performance of the
21 labor or delivery of the materials or supplies and of the
22 nonpayment. The notice of nonpayment may be served at any time
23 during the progress of the work or thereafter but not before
24 45 days after the first furnishing of labor, services, or
25 materials, and not later than 90 days after the final
26 furnishing of the labor, services, or materials by the
27 claimant or, with respect to rental equipment, not later than
28 90 days after the date that the rental equipment was last on
29 the job site available for use. Any notice of nonpayment
30 served by a claimant who is not in privity with the contractor
31 which includes sums for retainage must specify the portion of
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1 the amount claimed for retainage. No action for the labor,
2 materials, or supplies may be instituted against the
3 contractor or the surety unless both notices have been given.
4 Notices required or permitted under this section may be served
5 in accordance with s. 713.18. An action, except for an action
6 exclusively for recovery of retainage, must be instituted
7 against the contractor or the surety on the payment bond or
8 the payment provisions of a combined payment and performance
9 bond within 1 year after the performance of the labor or
10 completion of delivery of the materials or supplies. An action
11 exclusively for recovery of retainage must be instituted
12 against the contractor or the surety within 1 year after the
13 performance of the labor or completion of delivery of the
14 materials or supplies, or within 90 days after receipt of
15 final payment (or the payment estimate containing the owner's
16 final reconciliation of quantities if no further payment is
17 earned and due as a result of deductive adjustments) by the
18 contractor or surety, whichever comes last. A claimant may not
19 waive in advance his or her right to bring an action under the
20 bond against the surety. In any action brought to enforce a
21 claim against a payment bond under this section, the
22 prevailing party is entitled to recover a reasonable fee for
23 the services of his or her attorney for trial and appeal or
24 for arbitration, in an amount to be determined by the court,
25 which fee must be taxed as part of the prevailing party's
26 costs, as allowed in equitable actions. The time periods for
27 service of a notice of nonpayment or for bringing an action
28 against a contractor or a surety shall be measured from the
29 last day of furnishing labor, services, or materials by the
30 claimant and shall not be measured by other standards, such as
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1 the issuance of a certificate of occupancy or the issuance of
2 a certificate of substantial completion.
3 (10) Notwithstanding any other provision of law to the
4 contrary, a claimant may not institute an action for the sole
5 purpose of recovery of retainage against the contractor or
6 against the surety issuing a payment or performance bond
7 pursuant to this section until:
8 (a) The public entity has paid out that retainage to
9 the contractor and the time provided under ss. 218.70-218.76
10 or ss. 255.072-255.078 for payment of that retainage to the
11 claimant has expired;
12 (b) The claimant has completed all work required under
13 its contract and 90 days have passed since the owner's receipt
14 of the contractor's last payment request; or
15 (c) The claimant has made the written request to the
16 owner provided in subsection (11) and has not timely received
17 the requested information from the owner.
18 (11) An owner shall furnish in writing to a claimant
19 who has provided labor, services, or materials to a project,
20 within 5 business days after receipt of a written request from
21 that claimant, the following information:
22 (a) The dates of all payment requests received by the
23 owner from the contractor.
24 (b) The dates of all payments made by the owner to the
25 contractor.
26 (c) Whether the owner has received the contractor's
27 final payment request and, if so, the date the final payment
28 request was submitted by the contractor to the owner.
29 Section 14. Section 725.09, Florida Statutes, is
30 created to read:
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1 725.09 Construction contracts; contingent payment
2 provisions.--An entity may not enter into a contract for the
3 purchase of construction materials or services which
4 conditions payment for such materials or services on the
5 receipt of payment from any other entity. Any such conditional
6 payment provision is void as a violation of the public policy
7 of this state.
8 Section 15. This act shall take effect July 1, 2004.
9
10 *****************************************
11 SENATE SUMMARY
12 Creates the "Local Government Prompt Payment Act."
Redefines terms used in part VII of ch. 218, F.S. Revises
13 provisions relating to timely payment for purchases of
construction services. Revises deadlines for payment.
14 Provides procedures for project closeout and payment of
retainage. Provides requirements for local government
15 construction retainage. Provides that ss. 218.72-218.76,
F.S., apply to the payment of any payment request for
16 retainage. Creates the "Florida Prompt Payment Act."
Revises deadlines for the payment of subcontractors,
17 sub-subcontractors, materialmen, and suppliers on
construction contracts for public projects. Provides
18 definitions. Provides for timely payment for purchases of
construction services by a public entity. Provides
19 procedures for calculating payment due dates. Provides
procedures for handling improper payment requests.
20 Provides for the resolution of disputes. Provides for
project closeout and payment of retainage. Provides for
21 public-construction retainage. Provides that ss.
255.072-255.076, F.S., apply to the payment of any
22 payment request for retainage. Provides requirements for
certain notices of nonpayment served by a claimant who is
23 not in privity with the contractor. Provides limitations
on a claimant's institution of certain actions against a
24 contractor or surety. Provides for certain notices to the
claimant. Prohibits the inclusion in a contract for the
25 purchase of construction materials or services a
provision that conditions payment for such materials or
26 services on the receipt of payment from any other entity.
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