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HB0344 Engrossed |
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LRB096 04698 KTG 14760 b |
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| AN ACT concerning business.
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| Be it enacted by the People of the State of Illinois,
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| represented in the General Assembly:
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| Section 5. The Contractor Prompt Payment Act is amended by |
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| changing Section 10 as follows:
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| (815 ILCS 603/10)
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| Sec. 10. Construction contracts. |
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| (a) All construction contracts shall be deemed to provide |
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| the following: |
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| (1) If a contractor has performed in accordance with |
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| the provisions of a construction contract and the payment |
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| application has been approved by the owner or the owner's |
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| agent, the owner shall pay the amount due to the contractor |
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| pursuant to the payment application not more than 15 |
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| calendar days after the approval. The payment application |
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| shall be deemed approved 25 days after the owner receives |
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| it unless the owner provides, before the end of the 25-day |
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| period, a written statement of the amount withheld and the |
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| reason for withholding payment. If the owner finds that a |
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| portion of the work not in accordance with the contract, |
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| payment may be withheld for the reasonable value of that |
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| portion only. Payment shall be made for any portion of the |
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| contract for which the work has been performed in |
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HB0344 Engrossed |
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LRB096 04698 KTG 14760 b |
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| accordance with the provisions of the contract. |
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| Instructions or notification from an owner to his or her |
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| lender or architect to process or pay a payment application |
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| does not constitute approval of the payment application |
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| under this Act. |
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| (2) If a subcontractor has performed in accordance with |
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| the provisions of his or her contract with the contractor |
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| or subcontractor and the work has been accepted by the |
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| owner, the owner's agent, or the contractor, the contractor |
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| shall pay to his or her subcontractor and the subcontractor |
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| shall pay to his or her subcontractor, within 15 calendar |
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| days of the contractor's receipt from the owner or the |
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| subcontractor's receipt from the contractor of each |
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| periodic payment, final payment, or receipt of retainage |
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| monies, the full amount received for the work of the |
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| subcontractor based on the work completed or the services |
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| rendered under the construction contract.
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| (b) Under a construction contract, it is unlawful to |
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| withhold more than 5% retainage on payments earned by |
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| contractors and subcontractors. Upon completion of 50% of the |
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| work under the contract, retainage must be reduced to an amount |
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| not to exceed 2.5%. |
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| (Source: P.A. 95-567, eff. 8-31-07.)
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| Section 99. Effective date. This Act takes effect upon |
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| becoming law.
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