HB4418 103RD GENERAL ASSEMBLY

LRB103 36028 AWJ 66115 b

103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB4418

Introduced 1/16/2024, by Rep. William "Will" Davis

SYNOPSIS AS INTRODUCED:

New Act

Creates the Government Contract Retainage Act. Defines terms, including that "retainage" means a portion of money withheld from the payment of a contract for a specified period of time to ensure that a contractor or subcontractor finishes a construction project completely and finishes in the manner specified in the contract. Provides that interest shall accrue monthly on the first day of each month on retainage withheld by a governmental unit at a specified rate set by the State Treasurer. Requires retainage withheld by a governmental unit to be paid not more than 60 days after being retained, including interest accrued, unless the retainage was withheld on the last pay period of a project shall, which shall be paid not more than 120 days after being retained. Limits the concurrent exercise of home rule powers.

A BILL FOR

AN ACT concerning government.

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

Section 1. Short title. This Act may be cited as the Government Contract Retainage Act.

Section 5. Definitions. As used in this Act:

"Governmental unit" means a State agency or a unit of local government.

"State agency" has the meaning given to "state agencies" in Section 1-7 of the Illinois State Auditing Act.

"Retainage" means a portion of money withheld from the payment of a contract for a specified period of time to ensure that a contractor or subcontractor finishes a construction project completely and finishes in the manner specified in the contract.

Section 10. Interest on retainage. Interest shall accrue monthly on the first day of each month on retainage withheld by a governmental unit. The accrual rate shall be equal to the rate set by the Treasurer on the first of each month for the Local Government Investment Pool Fund Daily Rates.

Section 15. Payment of retainage. Retainage withheld by a governmental unit shall be paid not more than 60 days after being retained, including interest accrued under Section 10, except that retainage withheld on the last pay period of a project shall be paid not more than 120 days after being retained.

Section 90. Home rule. A home rule unit may not regulate retainage in a manner inconsistent with this Act. This Act is a limitation under subsection (i) of Section 6 of Article VII of the Illinois Constitution on the concurrent exercise by home rule units of powers and functions exercised by the State.