News Maker - WASHIINGTON DC
WASHINGTON DC - On August 2nd, Mayor Vincent Gray signed into law the "Private Contractor and Subcontractor Prompt Payment Act of 2013." The new law establishes private contractor and subcontractor prompt payment laws, time requirements for owners and contractors to pay contractors and subcontractors when the contract does not provide for specific dates and times of payment, and other requirements. The bill also provides civil penalties for failure to meet the prompt payment requirements. Further, it requires the Mayor to select an agency director to monitor and enforce the provisions of the Act and who will be responsible for developing a plan for payment terms based on established industry standards.
Specifically The new law requires an owner to pay undisputed balances within 15 days of granting an occupancy permit, 15 days after the owner takes possession of the property, or 15 days after the owner receives a payment request, whichever is earlier.
A prime/general contractor must pay its subs within 7 days of receipt of payment from the owner. If payment is not made promptly, the owner/contractor will owe interest at the rate of 1.5 percent per month and, if the contractor/subcontractor prevails in a civil action, they'll also receive reasonable attorney fees.