093_SB0155eng SB155 Engrossed LRB093 06706 SJM 06840 b 1 AN ACT concerning procurement. 2 Be it enacted by the People of the State of Illinois, 3 represented in the General Assembly: 4 Section 5. The State Prompt Payment Act is amended by 5 changing Section 7 as follows: 6 (30 ILCS 540/7) (from Ch. 127, par. 132.407) 7 Sec. 7. Payments to subcontractors and material 8 suppliers. 9 (a) When a State official or agency responsible for 10 administering a contract submits a voucher to the Comptroller 11 for payment to a contractor, that State official or agency 12 shall promptly make available electronically the voucher 13 number, the date of the voucher, and the amount of the 14 voucher. The State official or agency responsible for 15 administering the contract shall provide subcontractors and 16 material suppliers, known to the State official or agency, 17 with instructions on how to access the electronic 18 information. When a contractor receives any payment, the 19 contractor shall pay each subcontractor and material supplier 20 in proportion to the work completed by each subcontractor and 21 material supplier their application less any retention. If 22 the contractor receives less than the full payment due under 23 the public construction contract, the contractor shall be 24 obligated to disburse on a pro rata basis those funds 25 received, with the contractor, subcontractors and material 26 suppliers each receiving a prorated portion based on the 27 amount of payment. When, however, the public owner does not 28 release the full payment due under the contract because there 29 are specific areas of work or materials the contractor is 30 rejecting or because the contractor has otherwise determined 31 such areas are not suitable for payment, then those specific SB155 Engrossed -2- LRB093 06706 SJM 06840 b 1 subcontractors or suppliers involved shall not be paid for 2 that portion of work rejected or deemed not suitable for 3 payment and all other subcontractors and suppliers shall be 4 paid in full. 5 (b) If the contractor, without reasonable cause, fails 6 to make fullanypayment of amounts due under subsection (a) 7 to his subcontractors and material suppliers within 15 days 8 after receipt of payment under the public construction 9 contract, the contractor shall pay to his subcontractors and 10 material suppliers, in addition to the payment due them, 11 interest in the amount of 4%2%per month, calculated from 12 the expiration of the 15-day period until fully paid. This 13 subsection shall also apply to any payments made by 14 subcontractors and material suppliers to their subcontractors 15 and material suppliers and to all payments made to lower tier 16 subcontractors and material suppliers throughout the 17 contracting chain. 18 (1) If a contractor, without reasonable cause, 19 fails to make payment in full as provided in subsection 20 (a) within 15 days after receipt of payment under the 21 public construction contract, any subcontractor or 22 material supplier to whom payments are owed may file a 23 written notice with the State official or agency setting 24 forth the amount owed by the contractor and the 25 contractor's failure to timely pay the amount owed. 26 (2) The State official or agency, within 15 days 27 after receipt of a subcontractor's or material supplier's 28 written notice of the failure to receive payment from the 29 contractor, shall hold a hearing to determine whether the 30 contractor withheld payment, without reasonable cause, 31 from the subcontractors and material suppliers and what 32 amount, if any, is due to the subcontractors and material 33 suppliers. The State official or agency shall provide 34 appropriate notice to the parties of the date, time, and SB155 Engrossed -3- LRB093 06706 SJM 06840 b 1 location of the hearing. 2 (3) If the State official or agency determines that 3 the contractor failed to make payment in full, without 4 reasonable cause, as provided in subsection (a), then the 5 State official or agency shall, in writing, direct the 6 contractor to pay the amount owed to the subcontractors 7 and material suppliers plus interest within 15 days after 8 the State official's or agency's finding. 9 (4) If a contractor fails to make full payment 10 within 15 days after the State official's or agency's 11 finding, then the contractor shall be barred from 12 entering into a State public construction contract for a 13 period of one year beginning on the date of the State 14 official's or agency's finding. 15 (Source: P.A. 87-773.)