HB 0509CS

CHAMBER ACTION



1The State Administration Council recommends the following:
2
3     Council/Committee Substitute
4     Remove the entire bill and insert:
5
A bill to be entitled
6An act relating to prompt payment for construction
7services; amending s. 218.70, F.S.; providing a popular
8name; amending s. 218.72, F.S.; redefining terms used in
9pt. VII of ch. 218, F.S.; amending s. 218.735, F.S.;
10revising provisions relating to timely payment for
11purchases of construction services; revising deadlines for
12payment; providing procedures for project closeout and
13payment of retainage; providing requirements for local
14government construction retainage; providing exceptions;
15creating s. 255.0705, F.S.; providing a popular name;
16amending s. 255.071, F.S.; revising deadlines for the
17payment of subcontractors, sub-subcontractors,
18materialmen, and suppliers on construction contracts for
19public projects; creating ss. 255.072, 255.073, 255.074,
20255.075, 255.076, 255.077, and 255.078, F.S.; providing
21definitions; providing for timely payment for purchases of
22construction services by a public entity; providing
23procedures for calculating payment due dates; authorizing
24the collection of interest under certain circumstances;
25providing for an award of court costs and attorney's fees;
26providing for project closeout and payment of retainage;
27providing exceptions; amending s. 255.05, F.S.; providing
28requirements for certain notices of nonpayment served by a
29claimant who is not in privity with the contractor;
30providing limitations on a claimant's institution of
31certain actions against a contractor or surety; amending
32s. 287.0585, F.S.; providing an exemption for contractors
33making late payment to subcontractors when the contract is
34subject to the "Prompt Payment Act"; amending s. 95.11,
35F.S., to conform a cross reference; providing that
36specified sections of the act do not apply to certain
37pending contracts and projects; providing an effective
38date.
39
40Be It Enacted by the Legislature of the State of Florida:
41
42     Section 1.  Section 218.70, Florida Statutes, is amended to
43read:
44     218.70  Popular name Short title.--This part may be cited
45as the "Local Government Florida Prompt Payment Act."
46     Section 2.  Subsections (2), (6), and (7) of section
47218.72, Florida Statutes, are amended, and subsection (10) is
48added to said section, to read:
49     218.72  Definitions.--As used in this part:
50     (2)  "Local governmental entity" means a county or
51municipal government, school board, school district, authority,
52special taxing district, other political subdivision, or any
53office, board, bureau, commission, department, branch, division,
54or institution thereof or any project supported by county or
55municipal funds.
56     (6)  "Vendor" means any person who sells goods or services,
57sells or leases personal property, or leases real property
58directly to a local governmental entity. The term includes any
59person who provides waste-hauling services to residents or
60businesses located within the boundaries of a local government
61pursuant to a contract or local ordinance.
62     (7)  "Construction services" means all labor, services, and
63materials provided in connection with the construction,
64alteration, repair, demolition, reconstruction, or any other
65improvements to real property that require a license under parts
66I and II of chapter 489.
67     (10)  "Contractor" or "provider of construction services"
68means any person who contracts directly with a local
69governmental entity to provide construction services.
70     Section 3.  Subsection (6) of section 218.735, Florida
71Statutes, is amended, present subsection (7) of said section is
72redesignated as subsection (9), and new subsections (7) and (8)
73are added to said section, to read:
74     218.735  Timely payment for purchases of construction
75services.--
76     (6)  When a contractor receives payment from a local
77governmental entity for labor, services, or materials furnished
78by subcontractors and suppliers hired by the contractor, the
79contractor shall remit payment due to those subcontractors and
80suppliers within 10 15 days after the contractor's receipt of
81payment. When a subcontractor receives payment from a contractor
82for labor, services, or materials furnished by subcontractors
83and suppliers hired by the subcontractor, the subcontractor
84shall remit payment due to those subcontractors and suppliers
85within 7 15 days after the subcontractor's receipt of payment.
86Nothing herein shall prohibit a contractor or subcontractor from
87disputing, pursuant to the terms of the relevant contract, all
88or any portion of a payment alleged to be due to another party.
89In the event of such a dispute, the contractor or subcontractor
90may withhold the disputed portion of any such payment if the
91contractor or subcontractor notifies the party whose payment is
92disputed, in writing, of the amount in dispute and the actions
93required to cure the dispute. The contractor or subcontractor
94must pay all undisputed amounts due within the time limits
95imposed by this section.
96     (7)(a)  Each contract for construction services between a
97local governmental entity and a contractor must provide for the
98development of a list of items required to render complete,
99satisfactory, and acceptable the construction services purchased
100by the local governmental entity. The contract must specify the
101process for the development of the list, including
102responsibilities of the local governmental entity and the
103contractor in developing and reviewing the list and a reasonable
104time for developing the list, as follows:
105     1.  For construction projects having an estimated cost of
106less than $10 million, within 30 calendar days after reaching
107substantial completion of the construction services purchased as
108defined in the contract, or, if not defined in the contract,
109upon reaching beneficial occupancy or use; or
110     2.  For construction projects having an estimated cost of
111$10 million or more, within 30 calendar days, unless otherwise
112extended by contract not to exceed 60 calendar days, after
113reaching substantial completion of the construction services
114purchased as defined in the contract, or, if not defined in the
115contract, upon reaching beneficial occupancy or use.
116     (b)  If the contract between the local governmental entity
117and the contractor relates to the purchase of construction
118services on more than one building or structure, or involves a
119multiphased project, the contract must provide for the
120development of a list of items required to render complete,
121satisfactory, and acceptable all the construction services
122purchased pursuant to the contract for each building, structure,
123or phase of the project within the time limitations provided in
124paragraph (a).
125     (c)  The failure to include any corrective work or pending
126items not yet completed on the list developed pursuant to this
127subsection does not alter the responsibility of the contractor
128to complete all the construction services purchased pursuant to
129the contract.
130     (d)  Upon completion of all items on the list, the
131contractor may submit a payment request for all remaining
132retainage withheld by the local governmental entity pursuant to
133this section. If a good-faith dispute exists as to whether one
134or more items identified on the list have been completed
135pursuant to the contract, the local governmental entity may
136continue to withhold an amount not to exceed 150 percent of the
137total costs to complete such items.
138     (e)  All items that require correction under the contract
139and that are identified after the preparation and delivery of
140the list remain the obligation of the contractor as defined by
141the contract.
142     (f)  Warranty items may not affect the final payment of
143retainage as provided in this section or as provided in the
144contract between the contractor and its subcontractors and
145suppliers.
146     (g)  Retainage may not be held by a local governmental
147entity or a contractor to secure payment of insurance premiums
148under a consolidated insurance program or series of insurance
149policies issued to a local governmental entity or a contractor
150for a project or group of projects, and the final payment of
151retainage as provided in this section may not be delayed pending
152a final audit by the local governmental entity's or contractor's
153insurance provider.
154     (h)  If a local governmental entity fails to comply with
155its responsibilities to develop the list required under
156paragraph (a) or paragraph (b), as defined in the contract,
157within the time limitations provided in paragraph (a), the
158contractor may submit a payment request for all remaining
159retainage withheld by the local governmental entity pursuant to
160this section. The local governmental entity need not pay or
161process any payment request for retainage if the contractor has,
162in whole or in part, failed to cooperate with the local
163governmental entity in the development of the list or failed to
164perform its contractual responsibilities, if any, with regard to
165the development of the list or if paragraph (8)(f) applies.
166     (8)(a)  With regard to any contract for construction
167services, a local governmental entity may withhold from each
168progress payment made to the contractor an amount not exceeding
16910 percent of the payment as retainage until 50-percent
170completion of such services.
171     (b)  After 50-percent completion of the construction
172services purchased pursuant to the contract, the local
173governmental entity must reduce to 5 percent the amount of
174retainage withheld from each subsequent progress payment made to
175the contractor. For purposes of this subsection, the term "50-
176percent completion" has the meaning set forth in the contract
177between the local governmental entity and the contractor or, if
178not defined in the contract, the point at which the local
179governmental entity has expended 50 percent of the total cost of
180the construction services purchased as identified in the
181contract together with all costs associated with existing change
182orders and other additions or modifications to the construction
183services provided for in the contract. However, notwithstanding
184this subsection, a municipality having a population of 25,000 or
185fewer, or a county having a population of 100,000 or fewer, may
186withhold retainage in an amount not exceeding 10 percent of each
187progress payment made to the contractor until final completion
188and acceptance of the project by the local governmental entity.
189     (c)  After 50-percent completion of the construction
190services purchased pursuant to the contract, the contractor may
191elect to withhold retainage from payments to its subcontractors
192at a rate higher than 5 percent. The specific amount to be
193withheld must be determined on a case-by-case basis and must be
194based on the contractor's assessment of the subcontractor's past
195performance, the likelihood that such performance will continue,
196and the contractor's ability to rely on other safeguards. The
197contractor shall notify the subcontractor, in writing, of its
198determination to withhold more than 5 percent of the progress
199payment and the reasons for making that determination, and the
200contractor may not request the release of such retained funds
201from the local governmental entity.
202     (d)  After 50-percent completion of the construction
203services purchased pursuant to the contract, the contractor may
204present to the local governmental entity a payment request for
205up to one-half of the retainage held by the local governmental
206entity. The local governmental entity shall promptly make
207payment to the contractor, unless the local governmental entity
208has grounds, pursuant to paragraph (f), for withholding the
209payment of retainage. If the local governmental entity makes
210payment of retainage to the contractor under this paragraph
211which is attributable to the labor, services, or materials
212supplied by one or more subcontractors or suppliers, the
213contractor shall timely remit payment of such retainage to those
214subcontractors and suppliers.
215     (e)  This section does not prohibit a local governmental
216entity from withholding retainage at a rate less than 10 percent
217of each progress payment, from incrementally reducing the rate
218of retainage pursuant to a schedule provided for in the
219contract, or from releasing at any point all or a portion of any
220retainage withheld by the local governmental entity which is
221attributable to the labor, services, or materials supplied by
222the contractor or by one or more subcontractors or suppliers. If
223a local governmental entity makes any payment of retainage to
224the contractor which is attributable to the labor, services, or
225materials supplied by one or more subcontractors or suppliers,
226the contractor shall timely remit payment of such retainage to
227those subcontractors and suppliers.
228     (f)  This section does not require the local governmental
229entity to pay or release any amounts that are the subject of a
230good-faith dispute, the subject of a claim brought pursuant to
231s. 255.05, or otherwise the subject of a claim or demand by the
232local governmental entity or contractor.
233     (g)  The time limitations set forth in this section for
234payment of payment requests apply to any payment request for
235retainage made pursuant to this section.
236     (h)  Paragraphs (a)-(d) do not apply to construction
237services purchased by a local governmental entity which are paid
238for, in whole or in part, with federal funds and are subject to
239federal grantor laws and regulations or requirements that are
240contrary to any provision of the Local Government Prompt Payment
241Act.
242     (i)  This subsection does not apply to any construction
243services purchased by a local governmental entity if the total
244cost of the construction services purchased as identified in the
245contract is $200,000 or less.
246     Section 4.  Section 255.0705, Florida Statutes, is created
247to read:
248     255.0705  Popular name.--Sections 255.0705-255.078 may be
249cited as the "Florida Prompt Payment Act."
250     Section 5.  Subsections (2) and (3) of section 255.071,
251Florida Statutes, are amended to read:
252     255.071  Payment of subcontractors, sub-subcontractors,
253materialmen, and suppliers on construction contracts for public
254projects.--
255     (2)  The failure to pay any undisputed obligations for such
256labor, services, or materials within 30 days after the date the
257labor, services, or materials were furnished and payment for
258such labor, services, or materials became due, or within the
259time limitations set forth in s. 255.073(3) 30 days after the
260date payment for such labor, services, or materials is received,
261whichever last occurs, shall entitle any person providing such
262labor, services, or materials to the procedures specified in
263subsection (3) and the remedies provided in subsection (4).
264     (3)  Any person providing labor, services, or materials for
265the construction of a public building, for the prosecution and
266completion of a public work, or for repairs upon a public
267building or public work improvements to real property may file a
268verified complaint alleging:
269     (a)  The existence of a contract for providing such labor,
270services, or materials to improve real property.
271     (b)  A description of the labor, services, or materials
272provided and alleging that the labor, services, or materials
273were provided in accordance with the contract.
274     (c)  The amount of the contract price.
275     (d)  The amount, if any, paid pursuant to the contract.
276     (e)  The amount that remains unpaid pursuant to the
277contract and the amount thereof that is undisputed.
278     (f)  That the undisputed amount has remained due and
279payable pursuant to the contract for more than 30 days after the
280date the labor or services were accepted or the materials were
281received.
282     (g)  That the person against whom the complaint was filed
283has received payment on account of the labor, services, or
284materials described in the complaint and, as of the date the
285complaint was filed, has failed to make payment within the time
286limitations set forth in s. 255.073(3) more than 30 days prior
287to the date the complaint was filed.
288     Section 6.  Section 255.072, Florida Statutes, is created
289to read:
290     255.072  Definitions.--As used in ss. 255.073-255.078, the
291term:
292     (1)  "Agent" means project architect, project engineer, or
293any other agency or person acting on behalf of a public entity.
294     (2)  "Construction services" means all labor, services, and
295materials provided in connection with the construction,
296alteration, repair, demolition, reconstruction, or any other
297improvements to real property. The term "construction services"
298does not include contracts or work performed for the Department
299of Transportation.
300     (3)  "Contractor" means any person who contracts directly
301with a public entity to provide construction services.
302     (4)  "Payment request" means a request for payment for
303construction services which conforms with all statutory
304requirements and with all requirements specified by the public
305entity to which the payment request is submitted.
306     (5)  "Public entity" means the state, or any office, board,
307bureau, commission, department, branch, division, or institution
308thereof, but does not include a local governmental entity as
309defined in s. 218.72.
310     (6)  "Purchase" means the purchase of construction
311services.
312     Section 7.  Section 255.073, Florida Statutes, is created
313to read:
314     255.073  Timely payment for purchases of construction
315services.--
316     (1)  Except as otherwise provided in ss. 255.072-255.078,
317s. 215.422 governs the timely payment for construction services
318by a public entity.
319     (2)  If a public entity disputes a portion of a payment
320request, the undisputed portion must be timely paid.
321     (3)  When a contractor receives payment from a public
322entity for labor, services, or materials furnished by
323subcontractors and suppliers hired by the contractor, the
324contractor shall remit payment due to those subcontractors and
325suppliers within 10 days after the contractor's receipt of
326payment. When a subcontractor receives payment from a contractor
327for labor, services, or materials furnished by subcontractors
328and suppliers hired by the subcontractor, the subcontractor
329shall remit payment due to those subcontractors and suppliers
330within 7 days after the subcontractor's receipt of payment. This
331subsection does not prohibit a contractor or subcontractor from
332disputing, pursuant to the terms of the relevant contract, all
333or any portion of a payment alleged to be due to another party
334if the contractor or subcontractor notifies the party whose
335payment is disputed, in writing, of the amount in dispute and
336the actions required to cure the dispute. The contractor or
337subcontractor must pay all undisputed amounts due within the
338time limits imposed by this subsection.
339     (4)  All payments due for the purchase of construction
340services and not made within the applicable time limits shall
341bear interest at the rate specified in s. 215.422. After July 1,
3422006, such payments shall bear interest at the rate of 1 percent
343per month, to the extent that the Chief Financial Officer's
344replacement project for the state's accounting and cash
345management systems is operational for the particular affected
346public entity. After January 1, 2007, all such payments due from
347public entity shall bear interest at the rate of 1 percent per
348month.
349     Section 8.  Section 255.074, Florida Statutes, is created
350to read:
351     255.074  Procedures for calculation of payment due dates.--
352     (1)  Each public entity shall establish procedures whereby
353each payment request received by the public entity is marked as
354received on the date on which it is delivered to an agent or
355employee of the public entity or of a facility or office of the
356public entity.
357     (2)  If the terms under which a purchase is made allow for
358partial deliveries and a payment request is submitted for a
359partial delivery, the time for payment for the partial delivery
360must be calculated from the time of the partial delivery and the
361submission of the payment request.
362     (3)  A public entity must submit a payment request to the
363Chief Financial Officer for payment no more than 20 days after
364receipt of the payment request.
365     Section 9.  Section 255.075, Florida Statutes, is created
366to read:
367     255.075  Mandatory interest.--A contract between a public
368entity and a contractor may not prohibit the collection of late
369payment interest charges authorized under s. 255.073(4).
370     Section 10.  Section 255.076, Florida Statutes, is created
371to read:
372     255.076  Award of court costs and attorney's fees.--In an
373action to recover amounts due for construction services
374purchased by a public entity, the court shall award court costs
375and reasonable attorney's fees, including fees incurred through
376any appeal, to the prevailing party, if the court finds that the
377nonprevailing party withheld any portion of the payment that is
378the subject of the action without any reasonable basis in law or
379fact to dispute the prevailing party's claim to those amounts.
380     Section 11.  Section 255.077, Florida Statutes, is created
381to read:
382     255.077  Project closeout and payment of retainage.--
383     (1)  Each contract for construction services between a
384public entity and a contractor must provide for the development
385of a list of items required to render complete, satisfactory,
386and acceptable the construction services purchased by the public
387entity. The contract must specify the process for the
388development of the list, including responsibilities of the
389public entity and the contractor in developing and reviewing the
390list and a reasonable time for developing the list, as follows:
391     (a)  For construction projects having an estimated cost of
392less than $10 million, within 30 calendar days after reaching
393substantial completion of the construction services purchased as
394defined in the contract, or, if not defined in the contract,
395upon reaching beneficial occupancy or use; or
396     (b)  For construction projects having an estimated cost of
397$10 million or more, within 30 calendar days, unless otherwise
398extended by contract not to exceed 60 calendar days, after
399reaching substantial completion of the construction services
400purchased as defined in the contract, or, if not defined in the
401contract, upon reaching beneficial occupancy or use.
402     (2)  If the contract between the public entity and the
403contractor relates to the purchase of construction services on
404more than one building or structure, or involves a multiphased
405project, the contract must provide for the development of a list
406of items required to render complete, satisfactory, and
407acceptable all the construction services purchased pursuant to
408the contract for each building, structure, or phase of the
409project within the time limitations provided in subsection (1).
410     (3)  The failure to include any corrective work or pending
411items not yet completed on the list developed pursuant to
412subsection (1) or subsection (2) does not alter the
413responsibility of the contractor to complete all the
414construction services purchased pursuant to the contract.
415     (4)  Upon completion of all items on the list, the
416contractor may submit a payment request for all remaining
417retainage withheld by the public entity pursuant to s. 255.078.
418If a good-faith dispute exists as to whether one or more items
419identified on the list have been completed pursuant to the
420contract, the public entity may continue to withhold an amount
421not to exceed 150 percent of the total costs to complete such
422items.
423     (5)  All items that require correction under the contract
424and that are identified after the preparation and delivery of
425the list remain the obligation of the contractor as defined by
426the contract.
427     (6)  Warranty items may not affect the final payment of
428retainage as provided in this section or as provided in the
429contract between the contractor and its subcontractors and
430suppliers.
431     (7)  Retainage may not be held by a public entity or a
432contractor to secure payment of insurance premiums under a
433consolidated insurance program or series of insurance policies
434issued to a public entity or a contractor for a project or group
435of projects, and the final payment of retainage as provided in
436this section may not be delayed pending a final audit by the
437public entity's or contractor's insurance provider.
438     (8)  If a public entity fails to comply with its
439responsibilities to develop the list required under subsection
440(1) or subsection (2), as defined in the contract, within the
441time limitations provided in subsection (1), the contractor may
442submit a payment request for all remaining retainage withheld by
443the public entity pursuant to s. 255.078. The public entity need
444not pay or process any payment request for retainage if the
445contractor has, in whole or in part, failed to cooperate with
446the public entity in the development of the list or failed to
447perform its contractual responsibilities, if any, with regard to
448the development of the list or if s. 255.078(6) applies.
449     Section 12.  Section 255.078, Florida Statutes, is created
450to read:
451     255.078  Public construction retainage.--
452     (1)  With regard to any contract for construction services,
453a public entity may withhold from each progress payment made to
454the contractor an amount not exceeding 10 percent of the payment
455as retainage until 50-percent completion of such services.
456     (2)  After 50-percent completion of the construction
457services purchased pursuant to the contract, the public entity
458must reduce to 5 percent the amount of retainage withheld from
459each subsequent progress payment made to the contractor. For
460purposes of this section, the term "50-percent completion" has
461the meaning set forth in the contract between the public entity
462and the contractor or, if not defined in the contract, the point
463at which the public entity has expended 50 percent of the total
464cost of the construction services purchased as identified in the
465contract together with all costs associated with existing change
466orders and other additions or modifications to the construction
467services provided for in the contract.
468     (3)  After 50-percent completion of the construction
469services purchased pursuant to the contract, the contractor may
470elect to withhold retainage from payments to its subcontractors
471at a rate higher than 5 percent. The specific amount to be
472withheld must be determined on a case-by-case basis and must be
473based on the contractor's assessment of the subcontractor's past
474performance, the likelihood that such performance will continue,
475and the contractor's ability to rely on other safeguards. The
476contractor shall notify the subcontractor, in writing, of its
477determination to withhold more than 5 percent of the progress
478payment and the reasons for making that determination, and the
479contractor may not request the release of such retained funds
480from the public entity.
481     (4)  After 50-percent completion of the construction
482services purchased pursuant to the contract, the contractor may
483present to the public entity a payment request for up to one-
484half of the retainage held by the public entity. The public
485entity shall promptly make payment to the contractor, unless the
486public entity has grounds, pursuant to subsection (6), for
487withholding the payment of retainage. If the public entity makes
488payment of retainage to the contractor under this subsection
489which is attributable to the labor, services, or materials
490supplied by one or more subcontractors or suppliers, the
491contractor shall timely remit payment of such retainage to those
492subcontractors and suppliers.
493     (5)  Neither this section nor s. 255.077 prohibits a public
494entity from withholding retainage at a rate less than 10 percent
495of each progress payment, from incrementally reducing the rate
496of retainage pursuant to a schedule provided for in the
497contract, or from releasing at any point all or a portion of any
498retainage withheld by the public entity which is attributable to
499the labor, services, or materials supplied by the contractor or
500by one or more subcontractors or suppliers. If a public entity
501makes any payment of retainage to the contractor which is
502attributable to the labor, services, or materials supplied by
503one or more subcontractors or suppliers, the contractor shall
504timely remit payment of such retainage to those subcontractors
505and suppliers.
506     (6)  Neither this section nor s. 255.077 requires the
507public entity to pay or release any amounts that are the subject
508of a good-faith dispute, the subject of a claim brought pursuant
509to s. 255.05, or otherwise the subject of a claim or demand by
510the public entity or contractor.
511     (7)  The same time limits for payment of a payment request
512apply regardless of whether the payment request is for, or
513includes, retainage.
514     (8)  Subsections (1)-(4) do not apply to construction
515services purchased by a public entity which are paid for, in
516whole or in part, with federal funds and are subject to federal
517grantor laws and regulations or requirements that are contrary
518to any provision of the Florida Prompt Payment Act.
519     (9)  This section does not apply to any construction
520services purchased by a public entity if the total cost of the
521construction services purchased as identified in the contract is
522$200,000 or less.
523     Section 13.  Paragraph (a) of subsection (2) of section
524255.05, Florida Statutes, is amended, and subsection (10) is
525added to said section, to read:
526     255.05  Bond of contractor constructing public buildings;
527form; action by materialmen.--
528     (2)(a)1.  If a claimant is no longer furnishing labor,
529services, or materials on a project, a contractor or the
530contractor's agent or attorney may elect to shorten the
531prescribed time in this paragraph within which an action to
532enforce any claim against a payment bond provided pursuant to
533this section may be commenced by recording in the clerk's office
534a notice in substantially the following form:
535
536
NOTICE OF CONTEST OF CLAIM
537
AGAINST PAYMENT BOND
538
539To:  . . . (Name and address of claimant) . . .  
540
541     You are notified that the undersigned contests your notice
542of nonpayment, dated ____________, ________, and served on the
543undersigned on ____________, ________, and that the time within
544which you may file suit to enforce your claim is limited to 60
545days after the date of service of this notice.
546
547     DATED on ____________, ________.
548
549Signed: . . . (Contractor or Attorney) . . .  
550
551The claim of any claimant upon whom such notice is served and
552who fails to institute a suit to enforce his or her claim
553against the payment bond within 60 days after service of such
554notice shall be extinguished automatically. The clerk shall mail
555a copy of the notice of contest to the claimant at the address
556shown in the notice of nonpayment or most recent amendment
557thereto and shall certify to such service on the face of such
558notice and record the notice. Service is complete upon mailing.
559     2.  A claimant, except a laborer, who is not in privity
560with the contractor shall, before commencing or not later than
56145 days after commencing to furnish labor, materials, or
562supplies for the prosecution of the work, furnish the contractor
563with a notice that he or she intends to look to the bond for
564protection. A claimant who is not in privity with the contractor
565and who has not received payment for his or her labor,
566materials, or supplies shall deliver to the contractor and to
567the surety written notice of the performance of the labor or
568delivery of the materials or supplies and of the nonpayment. The
569notice of nonpayment may be served at any time during the
570progress of the work or thereafter but not before 45 days after
571the first furnishing of labor, services, or materials, and not
572later than 90 days after the final furnishing of the labor,
573services, or materials by the claimant or, with respect to
574rental equipment, not later than 90 days after the date that the
575rental equipment was last on the job site available for use. Any
576notice of nonpayment served by a claimant who is not in privity
577with the contractor which includes sums for retainage must
578specify the portion of the amount claimed for retainage. No
579action for the labor, materials, or supplies may be instituted
580against the contractor or the surety unless both notices have
581been given. Notices required or permitted under this section may
582be served in accordance with s. 713.18. An action, except for an
583action exclusively for recovery of retainage, must be instituted
584against the contractor or the surety on the payment bond or the
585payment provisions of a combined payment and performance bond
586within 1 year after the performance of the labor or completion
587of delivery of the materials or supplies. An action exclusively
588for recovery of retainage must be instituted against the
589contractor or the surety within 1 year after the performance of
590the labor or completion of delivery of the materials or
591supplies, or within 90 days after receipt of final payment (or
592the payment estimate containing the owner's final reconciliation
593of quantities if no further payment is earned and due as a
594result of deductive adjustments) by the contractor or surety,
595whichever comes last. A claimant may not waive in advance his or
596her right to bring an action under the bond against the surety.
597In any action brought to enforce a claim against a payment bond
598under this section, the prevailing party is entitled to recover
599a reasonable fee for the services of his or her attorney for
600trial and appeal or for arbitration, in an amount to be
601determined by the court, which fee must be taxed as part of the
602prevailing party's costs, as allowed in equitable actions. The
603time periods for service of a notice of nonpayment or for
604bringing an action against a contractor or a surety shall be
605measured from the last day of furnishing labor, services, or
606materials by the claimant and shall not be measured by other
607standards, such as the issuance of a certificate of occupancy or
608the issuance of a certificate of substantial completion.
609     (10)  An action, except an action for recovery of
610retainage, must be instituted against the contractor or the
611surety on the payment bond or the payment provisions of a
612combined payment and performance bond within 1 year after the
613performance of the labor or completion of delivery of the
614materials or supplies. An action for recovery of retainage must
615be instituted against the contractor or the surety within 1 year
616after the performance of the labor or completion of delivery of
617the materials or supplies; however, such an action may not be
618instituted until one of the following conditions is satisfied:
619     (a)  The public entity has paid out the claimant's
620retainage to the contractor, and the time provided under s.
621218.735 or s. 255.073(3) for payment of that retainage to the
622claimant has expired;
623     (b)  The claimant has completed all work required under its
624contract and 70 days have passed since the contractor sent its
625final payment request to the public entity; or
626     (c)  At least 160 days have passed since reaching
627substantial completion of the construction services purchased,
628as defined in the contract, or if not defined in the contract,
629since reaching beneficial occupancy or use of the project.
630     (d)  The claimant has asked the contractor, in writing, for
631any of the following information and the contractor has failed
632to respond to the claimant's request, in writing, within 10 days
633after receipt of the request:
634     1.  Whether the project has reached substantial completion,
635as that term is defined in the contract, or if not defined in
636the contract, if beneficial occupancy or use of the project has
637occurred.
638     2.  Whether the contractor has received payment of the
639claimant's retainage, and if so, the date the retainage was
640received by the contractor.
641     3.  Whether the contractor has sent its final payment
642request to the public entity, and if so, the date on which the
643final payment request was sent.
644
645If none of the conditions described in paragraph (a), paragraph
646(b), paragraph (c), or paragraph (d) is satisfied and an action
647for recovery of retainage cannot be instituted within the 1-year
648limitation period set forth in this subsection, this limitation
649period shall be extended until 120 days after one of these
650conditions is satisfied.
651     Section 14.  Subsection (2) of section 287.0585, Florida
652Statutes, is amended to read:
653     287.0585  Late payments by contractors to subcontractors
654and suppliers; penalty.--
655     (2)  This section shall not apply when the contract between
656the contractor and subcontractors or subvendors provides
657otherwise, or when payments under the contract are otherwise
658governed by ss. 255.0705-255.078.
659     Section 15.  Paragraph (b) of subsection (2) of section
66095.11, Florida Statutes, is amended to read:
661     95.11  Limitations other than for the recovery of real
662property.--Actions other than for recovery of real property
663shall be commenced as follows:
664     (2)  WITHIN FIVE YEARS.--
665     (b)  A legal or equitable action on a contract, obligation,
666or liability founded on a written instrument, except for an
667action to enforce a claim against a payment bond, which shall be
668governed by the applicable provisions of ss. 255.05(10)
669255.05(2)(a)2. and 713.23(1)(e).
670     Section 16.  Neither the amendments to sections 95.11,
671218.70, 218.72, 218.735, and 255.071, Florida Statutes, and
672subsection (2) of section 255.05, Florida Statutes, as provided
673in this act, nor subsection (10) of section 255.05, Florida
674Statutes, and section 255.078, Florida Statutes, as created by
675this act, apply to any existing construction contract pending
676approval by a local governmental entity or public entity, or to
677any project advertised for bid by the local governmental entity
678or public entity, on or before October 1, 2005.
679     Section 17.  This act shall take effect October 1, 2005.


CODING: Words stricken are deletions; words underlined are additions.