HB4794 95TH GENERAL ASSEMBLY

LRB095 18063 HLH 44146 b

95TH GENERAL ASSEMBLY
State of Illinois
2007 and 2008
HB4794

Introduced , by Rep. Timothy L. Schmitz

SYNOPSIS AS INTRODUCED:

50 ILCS 505/3

from Ch. 85, par. 5603

Amends the Local Government Prompt Payment Act. Provides that it is unlawful to withhold more than 5% retainage from payments earned by contractors and subcontractors for goods and services. Prohibits retainage if a payment bond has been furnished. Effective immediately.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning finance.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Local Government Prompt Payment Act is amended by changing Section 3 as follows:

(50 ILCS 505/3) (from Ch. 85, par. 5603)

Sec. 3. Approval of bills; retainage.

(a) The appropriate local governmental official or agency receiving goods or services must approve or disapprove a bill from a vendor or contractor for goods or services furnished the local governmental agency within 30 days after the receipt of such bill or within 30 days after the date on which the goods or services were received, whichever is later. If one or more items on a construction related bill or invoice are disapproved, but not the entire bill or invoice, then the portion that is not disapproved shall be paid. When safety or quality assurance testing of goods by the local governmental agency is necessary before the approval or disapproval of a bill and such testing cannot be completed within 30 days after receipt of the goods, approval or disapproval of the bill must be made immediately upon completion of the testing or within 60 days after receipt of the goods, whichever occurs first. Written notice shall be mailed to the vendor or contractor immediately if a bill is disapproved.

(b) For goods or services furnished under this Act, it is unlawful to withhold more than 5% retainage on payments earned by contractors and subcontractors. No retainage may be withheld on projects for which a payment bond has been furnished pursuant to the Illinois Construction Bond Act.

(Source: P.A. 94-972, eff. 7-1-07.)

Section 99. Effective date. This Act takes effect upon becoming law.