January 22, 2020
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Amendment
Bill No. 0487
Amendment No. 806477
CHAMBER ACTION
Senate House
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1Representative Reagan offered the following:
2
3     Amendment (with title amendment)
4     Remove everything after the enacting clause and insert:
5     Section 1.  Section 218.70, Florida Statutes, is amended to
6read:
7     218.70  Popular name Short title.--This part may be known
8by the popular name cited as the "Local Government Florida
9Prompt Payment Act."
10     Section 2.  Subsections (2), (6), and (7) of section
11218.72, Florida Statutes, are amended, and subsection (10) is
12added to that section, to read:
13     218.72  Definitions.--As used in this part:
14     (2)  "Local governmental entity" means a county or
15municipal government, school board, school district, authority,
16special taxing district, other political subdivision, or any
17office, board, bureau, commission, department, branch, division,
18or institution thereof or any project supported by county or
19municipal funds.
20     (6)  "Vendor" means any person who sells goods or services,
21sells or leases personal property, or leases real property
22directly to a local governmental entity. The term includes any
23person who provides waste-hauling services to residents or
24businesses located within the boundaries of a local government
25pursuant to a contract or local ordinance.
26     (7)  "Construction services" means all labor, services, and
27materials provided in connection with the construction,
28alteration, repair, demolition, reconstruction, or any other
29improvements to real property that require a license under parts
30I and II of chapter 489.
31     (10)  "Contractor" or "provider of construction services"
32means any person who contracts directly with a local
33governmental entity to provide construction services.
34     Section 3.  Subsection (6) of section 218.735, Florida
35Statutes, is amended, present subsection (7) of that section is
36redesignated as subsection (9), and new subsections (7) and (8)
37are added to that section, to read:
38     218.735  Timely payment for purchases of construction
39services.--
40     (6)  When a contractor receives payment from a local
41governmental entity for labor, services, or materials furnished
42by subcontractors and suppliers hired by the contractor, the
43contractor shall remit payment due to those subcontractors and
44suppliers within 10 15 days after the contractor's receipt of
45payment. When a subcontractor receives payment from a contractor
46for labor, services, or materials furnished by subcontractors
47and suppliers hired by the subcontractor, the subcontractor
48shall remit payment due to those subcontractors and suppliers
49within 7 15 days after the subcontractor's receipt of payment.
50Nothing herein shall prohibit a contractor or subcontractor from
51disputing, pursuant to the terms of the relevant contract, all
52or any portion of a payment alleged to be due to another party.
53In the event of such a dispute, the contractor or subcontractor
54may withhold the disputed portion of any such payment if the
55contractor or subcontractor notifies the party whose payment is
56disputed, in writing, of the amount in dispute and the actions
57required to cure the dispute. The contractor or subcontractor
58must pay all undisputed amounts due within the time limits
59imposed by this section.
60     (7)(a)  Each contract for construction services between a
61local governmental entity and a contractor must provide for the
62development of a list of items required to render complete,
63satisfactory, and acceptable the construction services purchased
64by the local governmental entity. The contract must specify the
65process for the development of the list, including
66responsibilities of the local governmental entity and the
67contractor in developing and reviewing the list and a reasonable
68time for developing the list, as follows:
69     1.  For construction projects with an estimated cost of
70less than $10 million, within 30 calendar days after reaching
71substantial completion of the construction services purchased as
72defined in the contract, or, if not defined in the contract,
73upon reaching beneficial occupancy or use; or
74     2.  For construction projects with an estimated cost of $10
75million or more, within 30 calendar days, unless otherwise
76extended by contract not to exceed 60 calendar days, after
77reaching substantial completion of the construction services
78purchased as defined in the contract, or, if not defined in the
79contract, upon reaching beneficial occupancy or use.
80     (b)  If the contract between the local governmental entity
81and the contractor relates to the purchase of construction
82services on more than one building or structure, or involves a
83multiphased project, the contract shall provide for the
84development of a list of items required to render complete,
85satisfactory, and acceptable all the construction services
86purchased pursuant to the contract for each building, structure,
87or phase of the project within the time limitations provided in
88paragraph (a).
89     (c)  The failure to include any corrective work or pending
90items not yet completed on the list developed pursuant to this
91subsection does not alter the responsibility of the contractor
92to complete all the construction services purchased pursuant to
93the contract.
94     (d)  Upon completion of all items on the list, the
95contractor may submit a payment request for all remaining
96retainage withheld by the local governmental entity pursuant to
97this section. If a good-faith dispute exists as to whether one
98or more items identified on the list have been completed
99pursuant to the contract, the local governmental entity may
100continue to withhold an amount not to exceed 150 percent of the
101total costs to complete such items.
102     (e)  All items that require correction under the contract
103and that are identified after the preparation and delivery of
104the list remain the obligation of the contractor as defined by
105the contract.
106     (f)  Warranty items may not affect the final payment of
107retainage as provided in this section or as provided in the
108contract between the contractor and its subcontractors and
109suppliers.
110     (g)  Retainage may not be held by a local governmental
111entity or a contractor to secure payment of insurance premiums
112under a consolidated insurance program or series of insurance
113policies issued to a local governmental entity or a contractor
114for a project or group of projects, and the final payment of
115retainage as provided in this section may not be delayed pending
116a final audit by the local governmental entity's or contractor's
117insurance provider.
118     (h)  If a local governmental entity fails to comply with
119its responsibilities to develop the list required under
120paragraph (a) or paragraph(b), as defined in the contract,
121within the time limitations provided in paragraph (a), the
122contractor may submit a payment request for all remaining
123retainage withheld by the local governmental entity pursuant to
124this section. The local governmental entity need not pay or
125process any payment request for retainage if the contractor has,
126in whole or in part, failed to cooperate with the local
127governmental entity in the development of the list or failed to
128perform its contractual responsibilities, if any, with regard to
129the development of the list or if paragraph (8)(f) applies.
130     (8)(a)  With regard to any contract for construction
131services, a local governmental entity may withhold from each
132progress payment made to the contractor an amount not exceeding
13310 percent of the payment as retainage to ensure the
134satisfactory completion of the construction services purchased
135pursuant to the contract until 50-percent completion of such
136services.
137     (b)  After 50-percent completion of the construction
138services purchased pursuant to the contract, the local
139governmental entity must reduce to 5 percent the amount of
140retainage withheld from each subsequent progress payment made to
141the contractor. For purposes of this subsection, the term "50-
142percent completion" has the meaning set forth in the contract
143between the local governmental entity and the contractor, or, if
144not defined in the contract, the point at which the local
145governmental entity has expended 50 percent of the total cost of
146the construction services purchased as identified in the
147contract together with all costs associated with existing change
148orders and other additions or modifications to the construction
149services provided for in the contract. However, notwithstanding
150this subsection, a municipality with a population of 25,000 or
151fewer, or a county with a population of 100,000 or fewer, may
152withhold retainage in an amount not exceeding 10 percent of each
153progress payment made to the contractor until final completion
154and acceptance of the project by the local governmental entity.
155     (c)  After 50-percent completion of the construction
156services purchased pursuant to the contract, the contractor may
157elect to withhold retainage from payments to its subcontractors
158at a rate higher than 5 percent. The specific amount to be
159withheld must be determined on a case-by-case basis and must be
160based on the contractor's assessment of the subcontractor's past
161performance, the likelihood that such performance will continue,
162and the contractor's ability to rely on other safeguards. The
163contractor shall notify the subcontractor, in writing, of its
164determination to withhold more than 5 percent of the progress
165payment and the reasons for making that determination, and the
166contractor may not request the release of such retained funds
167from the local governmental entity.
168     (d)  After 50-percent completion of the construction
169services purchased pursuant to the contract, the contractor may
170present to the local governmental entity a payment request for
171up to one-half of the retainage held by the local governmental
172entity. The local governmental entity shall promptly make
173payment to the contractor, unless the local governmental entity
174has grounds, pursuant to paragraph (f), for withholding the
175payment of retainage. If the local governmental entity makes
176payment of retainage to the contractor under this paragraph
177which is attributable to the labor, services, or materials
178supplied by one or more subcontractors or suppliers, the
179contractor shall timely remit payment of such retainage to those
180subcontractors and suppliers.
181     (e)  This section does not prohibit a local governmental
182entity from withholding retainage at a rate less than 10 percent
183of each progress payment, from incrementally reducing the rate
184of retainage pursuant to a schedule provided for in the
185contract, or from releasing at any point all or a portion of any
186retainage withheld by the local governmental entity which is
187attributable to the labor, services, or materials supplied by
188the contractor or by one or more subcontractors or suppliers. If
189a local governmental entity makes any payment of retainage to
190the contractor which is attributable to the labor, services, or
191materials supplied by one or more subcontractors or suppliers,
192the contractor shall timely remit payment of such retainage to
193those subcontractors and suppliers.
194     (f)  This section does not require the local governmental
195entity to pay or release any amounts that are the subject of a
196good-faith dispute, the subject of an action brought pursuant to
197s. 255.05, or otherwise the subject of a claim or demand by the
198local governmental entity or contractor.
199     (g)  The time limitations set forth in this section for
200payment of payment requests apply to any payment request for
201retainage made pursuant to this section.
202     (h)  Paragraphs (a)-(d) do not apply to construction
203services purchased by a local governmental entity which are paid
204for, in whole or in part, with federal funds and are subject to
205federal grantor laws and regulations or requirements that are
206contrary to any provision of the Local Government Prompt Payment
207Act.
208     (i)  This subsection does not apply to any construction
209services purchased by a local governmental entity if the total
210cost of the construction services purchased as identified in the
211contract is $200,000 or less.
212     Section 4.  Section 255.0705, Florida Statutes, is created
213to read:
214     255.0705  Popular name.--Sections 255.0705-255.078 may be
215known by the popular name the "Florida Prompt Payment Act."
216     Section 5.  Subsections (2) and (3) of section 255.071,
217Florida Statutes, are amended to read:
218     255.071  Payment of subcontractors, sub-subcontractors,
219materialmen, and suppliers on construction contracts for public
220projects.--
221     (2)  The failure to pay any undisputed obligations for such
222labor, services, or materials within 30 days after the date the
223labor, services, or materials were furnished and payment for
224such labor, services, or materials became due, or within the
225time limitations set forth in s. 255.073(3) 30 days after the
226date payment for such labor, services, or materials is received,
227whichever last occurs, shall entitle any person providing such
228labor, services, or materials to the procedures specified in
229subsection (3) and the remedies provided in subsection (4).
230     (3)  Any person providing labor, services, or materials for
231the construction of a public building, for the prosecution and
232completion of a public work, or for repairs upon a public
233building or public work improvements to real property may file a
234verified complaint alleging:
235     (a)  The existence of a contract for providing such labor,
236services, or materials to improve real property.
237     (b)  A description of the labor, services, or materials
238provided and alleging that the labor, services, or materials
239were provided in accordance with the contract.
240     (c)  The amount of the contract price.
241     (d)  The amount, if any, paid pursuant to the contract.
242     (e)  The amount that remains unpaid pursuant to the
243contract and the amount thereof that is undisputed.
244     (f)  That the undisputed amount has remained due and
245payable pursuant to the contract for more than 30 days after the
246date the labor or services were accepted or the materials were
247received.
248     (g)  That the person against whom the complaint was filed
249has received payment on account of the labor, services, or
250materials described in the complaint and, as of the date the
251complaint was filed, has failed to make payment within the time
252limitations set forth in s. 255.073(3) more than 30 days prior
253to the date the complaint was filed.
254     Section 6.  Section 255.072, Florida Statutes, is created
255to read:
256     255.072  Definitions.--As used in ss. 255.073-255.078, the
257term:
258     (1)  "Agent" means project architect, project engineer, or
259any other agency or person acting on behalf of a public entity.
260     (2)  "Construction services" means all labor, services, and
261materials provided in connection with the construction,
262alteration, repair, demolition, reconstruction, or any other
263improvements to real property. The term "construction services"
264does not include contracts or work performed for the Department
265of Transportation.
266     (3)  "Contractor" means any person who contracts directly
267with a public entity to provide construction services.
268     (4)  "Payment request" means a request for payment for
269construction services which conforms with all statutory
270requirements and with all requirements specified by the public
271entity to which the payment request is submitted.
272     (5)  "Public entity" means the state, or any office, board,
273bureau, commission, department, branch, division, or institution
274thereof, but does not include a local governmental entity as
275defined in s. 218.72.
276     (6)  "Purchase" means the purchase of construction
277services.
278     Section 7.  Section 255.073, Florida Statutes, is created
279to read:
280     255.073  Timely payment for purchases of construction
281services.--
282     (1)  Except as otherwise provided in ss. 255.072-255.078,
283s. 215.422 governs the timely payment for construction services
284by a public entity.
285     (2)  If a public entity disputes a portion of a payment
286request, the undisputed portion must be timely paid.
287     (3)  When a contractor receives payment from a public
288entity for labor, services, or materials furnished by
289subcontractors and suppliers hired by the contractor, the
290contractor shall remit payment due to those subcontractors and
291suppliers within 10 days after the contractor's receipt of
292payment. When a subcontractor receives payment from a contractor
293for labor, services, or materials furnished by subcontractors
294and suppliers hired by the subcontractor, the subcontractor
295shall remit payment due to those subcontractors and suppliers
296within 7 days after the subcontractor's receipt of payment. This
297subsection does not prohibit a contractor or subcontractor from
298disputing, pursuant to the terms of the relevant contract, all
299or any portion of a payment alleged to be due to another party
300if the contractor or subcontractor notifies the party whose
301payment is disputed, in writing, of the amount in dispute and
302the actions required to cure the dispute. The contractor or
303subcontractor must pay all undisputed amounts due within the
304time limits imposed by this subsection.
305     (4)  All payments due for the purchase of construction
306services and not made within the applicable time limits shall
307bear interest at the rate specified in s. 215.422. After July 1,
3082005, such payments shall bear interest at the rate of 1 percent
309per month, to the extent that the Chief Financial Officer's
310replacement project for the state's accounting and cash
311management systems (Project ASPIRE) is operational for the
312particular affected public entities. After January 1, 2006, all
313such payments due from public entities shall bear interest at
314the rate of 1 percent per month.
315     Section 8.  Section 255.074, Florida Statutes, is created
316to read:
317     255.074  Procedures for calculation of payment due dates.--
318     (1)  Each public entity shall establish procedures whereby
319each payment request received by the public entity is marked as
320received on the date on which it is delivered to an agent or
321employee of the public entity or of a facility or office of the
322public entity.
323     (2)  If the terms under which a purchase is made allow for
324partial deliveries and a payment request is submitted for a
325partial delivery, the time for payment for the partial delivery
326must be calculated from the time of the partial delivery and the
327submission of the payment request.
328     (3)  A public entity must submit a payment request to the
329Chief Financial Officer for payment no more than 20 days after
330receipt of the payment request.
331     Section 9.  Section 255.075, Florida Statutes, is created
332to read:
333     255.075  Mandatory interest.--A contract between a public
334entity and a contractor may not prohibit the collection of late
335payment interest charges authorized under s. 255.073(4).
336     Section 10.  Section 255.076, Florida Statutes, is created
337to read:
338     255.076  Improper payment request; resolution of
339disputes.--In an action to recover amounts due for construction
340-In an action to recover amounts due for construction services
341purchased by a public entity, the court shall award court costs
342and reasonable attorney's fees, including fees incurred through
343any appeal, to the prevailing party, if the court finds that the
344nonprevailing party withheld any portion of the payment that is
345the subject of the action without any reasonable basis in law or
346fact to dispute the prevailing party's claim to those amounts.
347     Section 11.  Section 255.077, Florida Statutes, is created
348to read:
349     255.077  Project closeout and payment of retainage.--
350     (1)  Each contract for construction services between a
351public entity and a contractor must provide for the development
352of a list of items required to render complete, satisfactory,
353and acceptable the construction services purchased by the public
354entity. The contract must specify the process for the
355development of the list, including responsibilities of the
356public entity and the contractor in developing and reviewing the
357list and a reasonable time for developing the list, as follows:
358     (a)  For construction projects with an estimated cost of
359less than $10 million, within 30 calendar days after reaching
360substantial completion of the construction services purchased as
361defined in the contract, or, if not defined in the contract,
362upon reaching beneficial occupancy or use; or
363     (b)  For construction projects with an estimated cost of
364$10 million or more, within 30 calendar days, unless otherwise
365extended by contract not to exceed 60 calendar days, after
366reaching substantial completion of the construction services
367purchased as defined in the contract, or, if not defined in the
368contract, upon reaching beneficial occupancy or use.
369     (2)  If the contract between the public entity and the
370contractor relates to the purchase of construction services on
371more than one building or structure, or involves a multiphased
372project, the contract shall provide for the development of a
373list of items required to render complete, satisfactory, and
374acceptable all the construction services purchased pursuant to
375the contract for each building, structure, or phase of the
376project within the time limitations provided in subsection (1).
377     (3)  The failure to include any corrective work or pending
378items not yet completed on the list developed pursuant to
379subsection (1) or subsection (2) does not alter the
380responsibility of the contractor to complete all the
381construction services purchased pursuant to the contract.
382     (4)  Upon completion of all items on the list, the
383contractor may submit a payment request for all remaining
384retainage withheld by the public entity pursuant to s. 255.078.
385If a good-faith dispute exists as to whether one or more items
386identified on the list have been completed pursuant to the
387contract, the public entity may continue to withhold an amount
388not to exceed 150 percent of the total costs to complete such
389items.
390     (5)  All items that require correction under the contract
391and that are identified after the preparation and delivery of
392the list remain the obligation of the contractor as defined by
393the contract.
394     (6)  Warranty items may not affect the final payment of
395retainage as provided in this section or as provided in the
396contract between the contractor and its subcontractors and
397suppliers.
398     (7)  Retainage may not be held by a public entity or a
399contractor to secure payment of insurance premiums under a
400consolidated insurance program or series of insurance policies
401issued to a public entity or a contractor for a project or group
402of projects, and the final payment of retainage as provided in
403this section may not be delayed pending a final audit by the
404public entity's or contractor's insurance provider.
405     (8)  If a public entity fails to comply with its
406responsibilities to develop the list required under subsection
407(1) or subsection (2), as defined in the contract, within the
408time limitations provided in subsection (1), the contractor may
409submit a payment request for all remaining retainage withheld by
410the public entity pursuant to s. 255.078. The public entity need
411not pay or process any payment request for retainage if the
412contractor has, in whole or in part, failed to cooperate with
413the public entity in the development of the list or failed to
414perform its contractual responsibilities, if any, with regard to
415the development of the list or if s. 255.078(6) applies.
416     Section 12.  Section 255.078, Florida Statutes, is created
417to read:
418     255.078  Public construction retainage.--
419     (1)  With regard to any contract for construction services,
420a public entity may withhold from each progress payment made to
421the contractor an amount not exceeding 10 percent of the payment
422as retainage to ensure the satisfactory completion of the
423construction services purchased pursuant to the contract until
42450-percent completion of such services.
425     (2)  After 50-percent completion of the construction
426services purchased pursuant to the contract, the public entity
427must reduce to 5 percent the amount of retainage withheld from
428each subsequent progress payment made to the contractor. For
429purposes of this section, the term "50-percent completion" has
430the meaning set forth in the contract between the public entity
431and the contractor, or, if not defined in the contract, the
432point at which the public entity has expended 50 percent of the
433total cost of the construction services purchased as identified
434in the contract together with all costs associated with existing
435change orders and other additions or modifications to the
436construction services provided for in the contract.
437     (3)  After 50-percent completion of the construction
438services purchased pursuant to the contract, the contractor may
439elect to withhold retainage from payments to its subcontractors
440at a rate higher than 5 percent. The specific amount to be
441withheld must be determined on a case-by-case basis and must be
442based on the contractor's assessment of the subcontractor's past
443performance, the likelihood that such performance will continue,
444and the contractor's ability to rely on other safeguards. The
445contractor shall notify the subcontractor, in writing, of its
446determination to withhold more than 5 percent of the progress
447payment and the reasons for making that determination, and the
448contractor may not request the release of such retained funds
449from the public entity.
450     (4)  After 50-percent completion of the construction
451services purchased pursuant to the contract, the contractor may
452present to the public entity a payment request for up to one-
453half of the retainage held by the public entity. The public
454entity shall promptly make payment to the contractor, unless the
455public entity has grounds, pursuant to subsection (6), for
456withholding the payment of retainage. If the public entity makes
457payment of retainage to the contractor under this subsection
458which is attributable to the labor, services, or materials
459supplied by one or more subcontractors or suppliers, the
460contractor shall timely remit payment of such retainage to those
461subcontractors and suppliers.
462     (5)  Neither this section nor s. 255.077 prohibits a public
463entity from withholding retainage at a rate less than 10 percent
464of each progress payment, from incrementally reducing the rate
465of retainage pursuant to a schedule provided for in the
466contract, or from releasing at any point all or a portion of any
467retainage withheld by the public entity which is attributable to
468the labor, services, or materials supplied by the contractor or
469by one or more subcontractors or suppliers.  If a public entity
470makes any payment of retainage to the contractor which is
471attributable to the labor, services, or materials supplied by
472one or more subcontractors or suppliers, the contractor shall
473timely remit payment of such retainage to those subcontractors
474and suppliers.
475     (6)  Neither this section nor s. 255.077 requires the
476public entity to pay or release any amounts that are the subject
477of a good-faith dispute, the subject of an action brought
478pursuant to s. 255.05, or otherwise the subject of a claim or
479demand by the public entity or contractor.
480     (7)  The same time limits for payment of a payment request
481apply regardless of whether the payment request is for, or
482includes, retainage.
483     (8)  Subsections (1)-(4) do not apply to construction
484services purchased by a public entity which are paid for, in
485whole or in part, with federal funds and are subject to federal
486grantor laws and regulations or requirements that are contrary
487to any provision of the Florida Prompt Payment Act.
488     (9)  This section does not apply to any construction
489services purchased by a public entity if the total cost of the
490construction services purchased as identified in the contract is
491$200,000 or less.
492     Section 13.  Section 255.05, Florida Statutes, is amended
493to read:
494     255.05  Bond of contractor constructing public buildings;
495form; action by materialmen.--
496     (1)(a)  Any person entering into a formal contract with the
497state or any county, city, or political subdivision thereof, or
498other public authority, for the construction of a public
499building, for the prosecution and completion of a public work,
500or for repairs upon a public building or public work shall be
501required, before commencing the work or before recommencing the
502work after a default or abandonment, to execute, deliver to the
503public owner, and record in the public records of the county
504where the improvement is located, a payment and performance bond
505with a surety insurer authorized to do business in this state as
506surety. A public entity may not require a contractor to secure a
507surety bond under this section from a specific agent or bonding
508company. The bond must state on its front page: the name,
509principal business address, and phone number of the contractor,
510the surety, the owner of the property being improved, and, if
511different from the owner, the contracting public entity; the
512contract number assigned by the contracting public entity; and a
513description of the project sufficient to identify it, such as a
514legal description or the street address of the property being
515improved, and a general description of the improvement. Such
516bond shall be conditioned upon the contractor's performance of
517the construction work in the time and manner prescribed in the
518contract and promptly making payments to all persons defined in
519s. 713.01 who furnish labor, services, or materials for the
520prosecution of the work provided for in the contract. Any
521claimant may apply to the governmental entity having charge of
522the work for copies of the contract and bond and shall thereupon
523be furnished with a certified copy of the contract and bond. The
524claimant shall have a right of action against the contractor and
525surety for the amount due him or her, including unpaid finance
526charges due under the claimant's contract. Such action shall not
527involve the public authority in any expense. When such work is
528done for the state and the contract is for $100,000 or less, no
529payment and performance bond shall be required. At the
530discretion of the official or board awarding such contract when
531such work is done for any county, city, political subdivision,
532or public authority, any person entering into such a contract
533which is for $200,000 or less may be exempted from executing the
534payment and performance bond. When such work is done for the
535state, the Secretary of the Department of Management Services
536may delegate to state agencies the authority to exempt any
537person entering into such a contract amounting to more than
538$100,000 but less than $200,000 from executing the payment and
539performance bond. In the event such exemption is granted, the
540officer or officials shall not be personally liable to persons
541suffering loss because of granting such exemption. The
542Department of Management Services shall maintain information on
543the number of requests by state agencies for delegation of
544authority to waive the bond requirements by agency and project
545number and whether any request for delegation was denied and the
546justification for the denial.
547     (b)  The Department of Management Services shall adopt
548rules with respect to all contracts for $200,000 or less, to
549provide:
550     1.  Procedures for retaining up to 10 percent of each
551request for payment submitted by a contractor and procedures for
552determining disbursements from the amount retained on a pro rata
553basis to laborers, materialmen, and subcontractors, as defined
554in s. 713.01.
555     2.  Procedures for requiring certification from laborers,
556materialmen, and subcontractors, as defined in s. 713.01, prior
557to final payment to the contractor that such laborers,
558materialmen, and subcontractors have no claims against the
559contractor resulting from the completion of the work provided
560for in the contract.
561
562The state shall not be held liable to any laborer, materialman,
563or subcontractor for any amounts greater than the pro rata share
564as determined under this section.
565     (2)(a)1.  If a claimant is no longer furnishing labor,
566services, or materials on a project, a contractor or the
567contractor's agent or attorney may elect to shorten the
568prescribed time in this paragraph within which an action to
569enforce any claim against a payment bond provided pursuant to
570this section may be commenced by recording in the clerk's office
571a notice in substantially the following form:
572
573
NOTICE OF CONTEST OF CLAIM
574
AGAINST PAYMENT BOND
575
576To:  . . . (Name and address of claimant) . . .  
577
578     You are notified that the undersigned contests your notice
579of nonpayment, dated ____________, ________, and served on the
580undersigned on ____________, ________, and that the time within
581which you may file suit to enforce your claim is limited to 60
582days after the date of service of this notice.
583
584     DATED on ____________, ________.
585
586Signed: . . . (Contractor or Attorney) . . .  
587
588The claim of any claimant upon whom such notice is served and
589who fails to institute a suit to enforce his or her claim
590against the payment bond within 60 days after service of such
591notice shall be extinguished automatically. The clerk shall mail
592a copy of the notice of contest to the claimant at the address
593shown in the notice of nonpayment or most recent amendment
594thereto and shall certify to such service on the face of such
595notice and record the notice. Service is complete upon mailing.
596     2.  A claimant, except a laborer, who is not in privity
597with the contractor shall, before commencing or not later than
59845 days after commencing to furnish labor, materials, or
599supplies for the prosecution of the work, furnish the contractor
600with a notice that he or she intends to look to the bond for
601protection. A claimant who is not in privity with the contractor
602and who has not received payment for his or her labor,
603materials, or supplies shall deliver to the contractor and to
604the surety written notice of the performance of the labor or
605delivery of the materials or supplies and of the nonpayment. The
606notice of nonpayment may be served at any time during the
607progress of the work or thereafter but not before 45 days after
608the first furnishing of labor, services, or materials, and not
609later than 90 days after the final furnishing of the labor,
610services, or materials by the claimant or, with respect to
611rental equipment, not later than 90 days after the date that the
612rental equipment was last on the job site available for use. Any
613notice of nonpayment served by a claimant who is not in privity
614with the contractor which includes sums for retainage must
615specify the portion of the amount claimed for retainage. No
616action for the labor, materials, or supplies may be instituted
617against the contractor or the surety unless both notices have
618been given. Notices required or permitted under this section may
619be served in accordance with s. 713.18. An action, except for an
620action exclusively for recovery of retainage, must be instituted
621against the contractor or the surety on the payment bond or the
622payment provisions of a combined payment and performance bond
623within 1 year after the performance of the labor or completion
624of delivery of the materials or supplies. An action exclusively
625for recovery of retainage must be instituted against the
626contractor or the surety within 1 year after the performance of
627the labor or completion of delivery of the materials or
628supplies, or within 90 days after receipt of final payment (or
629the payment estimate containing the owner's final reconciliation
630of quantities if no further payment is earned and due as a
631result of deductive adjustments) by the contractor or surety,
632whichever comes last. A claimant may not waive in advance his or
633her right to bring an action under the bond against the surety.
634In any action brought to enforce a claim against a payment bond
635under this section, the prevailing party is entitled to recover
636a reasonable fee for the services of his or her attorney for
637trial and appeal or for arbitration, in an amount to be
638determined by the court, which fee must be taxed as part of the
639prevailing party's costs, as allowed in equitable actions. The
640time periods for service of a notice of nonpayment or for
641bringing an action against a contractor or a surety shall be
642measured from the last day of furnishing labor, services, or
643materials by the claimant and shall not be measured by other
644standards, such as the issuance of a certificate of occupancy or
645the issuance of a certificate of substantial completion.
646     (b)  When a person is required to execute a waiver of his
647or her right to make a claim against the payment bond in
648exchange for, or to induce payment of, a progress payment, the
649waiver may be in substantially the following form:
650
651
WAIVER OF RIGHT TO CLAIM AGAINST THE PAYMENT BOND (PROGRESS
652
PAYMENT)
653
654     The undersigned, in consideration of the sum of $____,
655hereby waives its right to claim against the payment bond for
656labor, services, or materials furnished through  . . . (insert
657date) . . .  to  . . . (insert the name of your customer) . . .  
658on the job of  . . . (insert the name of the owner) . . . , for
659improvements to the following described project:
660
661
(description of project)
662
663This waiver does not cover any retention or any labor, services,
664or materials furnished after the date specified.
665
666     DATED ON ________, ____.
667 . . . (Claimant) . . .
668By:____________
669
670     (c)  When a person is required to execute a waiver of his
671or her right to make a claim against the payment bond, in
672exchange for, or to induce payment of, the final payment, the
673waiver may be in substantially the following form:
674
675
WAIVER OF RIGHT TO CLAIM AGAINST THE PAYMENT BOND (FINAL
676
PAYMENT)
677
678     The undersigned, in consideration of the final payment in
679the amount of $____, hereby waives its right to claim against
680the payment bond for labor, services, or materials furnished to  
681. . . (insert the name of your customer) . . .  on the job of  .
682. . (insert the name of the owner) . . . , for improvements to
683the following described project:
684
685
(description of project)
686
687     DATED ON ________, ____.
688 . . . (Claimant) . . .
689By:____________
690
691     (d)  A person may not require a claimant to furnish a
692waiver that is different from the forms in paragraphs (b) and
693(c).
694     (e)  A claimant who executes a waiver in exchange for a
695check may condition the waiver on payment of the check.
696     (f)  A waiver that is not substantially similar to the
697forms in this subsection is enforceable in accordance with its
698terms.
699     (3)  The bond required in subsection (1) may be in
700substantially the following form:
701
702
PUBLIC CONSTRUCTION BOND
703
704     Bond No.  (enter bond number)
705
706     BY THIS BOND, We _____, as Principal and _____, a
707corporation, as Surety, are bound to _____, herein called Owner,
708in the sum of $_____, for payment of which we bind ourselves,
709our heirs, personal representatives, successors, and assigns,
710jointly and severally.
711     THE CONDITION OF THIS BOND is that if Principal:
712     1.  Performs the contract dated _____, _____, between
713Principal and Owner for construction of _____, the contract
714being made a part of this bond by reference, at the times and in
715the manner prescribed in the contract; and
716     2.  Promptly makes payments to all claimants, as defined in
717Section 255.05(1), Florida Statutes, supplying Principal with
718labor, materials, or supplies, used directly or indirectly by
719Principal in the prosecution of the work provided for in the
720contract; and
721     3.  Pays Owner all losses, damages, expenses, costs, and
722attorney's fees, including appellate proceedings, that Owner
723sustains because of a default by Principal under the contract;
724and
725     4.  Performs the guarantee of all work and materials
726furnished under the contract for the time specified in the
727contract, then this bond is void; otherwise it remains in full
728force.
729     Any action instituted by a claimant under this bond for
730payment must be in accordance with the notice and time
731limitation provisions in Section 255.05, Florida Statutes.
732     Any changes in or under the contract documents and
733compliance or noncompliance with any formalities connected with
734the contract or the changes does not affect Surety's obligation
735under this bond.
736
737     DATED ON _____, _____.
738
739 ...  (Name of Principal)  ...
740
741By ...  (As Attorney in Fact)  ...
742
743 ...  (Name of Surety)  ...
744
745     (4)  The payment provisions of all bonds required by
746furnished for public work contracts described in subsection (1)
747shall, regardless of form, be construed and deemed statutory
748bonds furnished pursuant to this section and such bonds shall
749not under any circumstances be converted into common law bonds
750bond provisions, subject to all requirements of subsection (2).
751     (5)  In addition to the provisions of chapter 47, any
752action authorized under this section may be brought in the
753county in which the public building or public work is being
754constructed or repaired.  This subsection shall not apply to an
755action instituted prior to May 17, 1977.
756     (6)  All bonds executed pursuant to this section shall make
757reference to this section by number and shall contain reference
758to the notice and time limitation provisions of this section.
759     (6)(7)  In lieu of the bond required by this section, a
760contractor may file with the state, county, city, or other
761political authority an alternative form of security in the form
762of cash, a money order, a certified check, a cashier's check, an
763irrevocable letter of credit, or a security of a type listed in
764part II of chapter 625. Any such alternative form of security
765shall be for the same purpose and be subject to the same
766conditions as those applicable to the bond required by this
767section.  The determination of the value of an alternative form
768of security shall be made by the appropriate state, county,
769city, or other political subdivision.
770     (7)(8)  When a contractor has furnished a payment bond
771pursuant to this section, he or she may, when the state, county,
772municipality, political subdivision, or other public authority
773makes any payment to the contractor or directly to a claimant,
774serve a written demand on any claimant who is not in privity
775with the contractor for a written statement under oath of his or
776her account showing the nature of the labor or services
777performed and to be performed, if any; the materials furnished;
778the materials to be furnished, if known; the amount paid on
779account to date; the amount due; and the amount to become due,
780if known, as of the date of the statement by the claimant. Any
781such demand to a claimant who is not in privity with the
782contractor must be served on the claimant at the address and to
783the attention of any person who is designated to receive the
784demand in the notice to contractor served by the claimant. The
785failure or refusal to furnish the statement does not deprive the
786claimant of his or her rights under the bond if the demand is
787not served at the address of the claimant or directed to the
788attention of the person designated to receive the demand in the
789notice to contractor. The failure to furnish the statement
790within 30 days after the demand, or the furnishing of a false or
791fraudulent statement, deprives the claimant who fails to furnish
792the statement, or who furnishes the false or fraudulent
793statement, of his or her rights under the bond. If the
794contractor serves more than one demand for statement of account
795on a claimant and none of the information regarding the account
796has changed since the claimant's last response to a demand, the
797failure or refusal to furnish such statement does not deprive
798the claimant of his or her rights under the bond. The negligent
799inclusion or omission of any information deprives the claimant
800of his or her rights under the bond to the extent that the
801contractor can demonstrate prejudice from such act or omission
802by the claimant. The failure to furnish a response to a demand
803for statement of account does not affect the validity of any
804claim on the bond being enforced in a lawsuit filed before the
805date the demand for statement of account is received by the
806claimant.
807     (8)(9)  On any public works project for which the public
808authority requires a performance and payment bond, suits at law
809and in equity may be brought and maintained by and against the
810public authority on any contract claim arising from breach of an
811express provision or an implied covenant of a written agreement
812or a written directive issued by the public authority pursuant
813to the written agreement.  In any such suit, the public
814authority and the contractor shall have all of the same rights
815and obligations as a private person under a like contract except
816that no liability may be based on an oral modification of either
817the written contract or written directive.  Nothing herein shall
818be construed to waive the sovereign immunity of the state and
819its political subdivisions from equitable claims and equitable
820remedies. The provisions of this subsection shall apply only to
821contracts entered into on or after July 1, 1999.
822     (9)  An action, except an action for recovery of retainage,
823must be instituted against the contractor or the surety on the
824payment bond or the payment provisions of a combined payment and
825performance bond within 1 year after the performance of the
826labor or completion of delivery of the materials or supplies. An
827action for recovery of retainage must be instituted against the
828contractor or the surety within 1 year after the performance of
829the labor or completion of delivery of the materials or
830supplies, provided that such an action may not be instituted
831until one of the following conditions is satisfied:
832     (a)  The public entity has paid out the claimant's
833retainage to the contractor, and the time provided under s.
834255.073(3) for payment of that retainage to the claimant has
835expired;
836     (b)  The claimant has completed all work required under its
837contract and 70 days have passed since the contractor sent its
838final payment request to the public entity; or
839     (c)  The claimant has asked the contractor, in writing,
840when the contractor received payment of the claimant's retainage
841or when the contractor sent its final payment request to the
842public entity, and the contractor has failed to respond to this
843request, in writing, within 10 days after receipt.
844
845If none of the conditions described in paragraph (a), paragraph
846(b), or paragraph (c) is satisfied and an action for recovery of
847retainage therefore cannot be instituted within the 1-year
848limitation period set forth in this subsection, this limitation
849period shall be extended until 120 days after one of these
850conditions is satisfied.
851     Section 14.  Paragraph (b) of subsection (2) of section
85295.11, Florida Statutes, is amended to read:
853     95.11  Limitations other than for the recovery of real
854property.--Actions other than for recovery of real property
855shall be commenced as follows:
856     (2)  WITHIN FIVE YEARS.--
857     (b)  A legal or equitable action on a contract, obligation,
858or liability founded on a written instrument, except for an
859action to enforce a claim against a payment bond, which shall be
860governed by the applicable provisions of ss. 255.05(9)
861255.05(2)(a)2. and 713.23(1)(e).
862     Section 15.  Neither the amendments to sections 95.11,
863218.70, 218.72, 218.735, and 255.071, Florida Statutes, and
864subsection (2) of section 255.05, Florida Statutes, as provided
865in this act, nor subsection (9) of section 255.05, Florida
866Statutes, and section 255.078, Florida Statutes, as created by
867this act, applies to any existing construction contract pending
868approval by a local governmental entity or public entity, or to
869any project advertised for bid by the local government entity or
870public entity, on or before the effective date of this act. The
871amendments to subsections (3), (4), and (6) of section 255.05,
872Florida Statutes, as provided in this act, apply to public
873construction bonds issued for contracts entered into on or after
874the effective date of this act.
875     Section 16.  This act shall take effect October 1, 2004.
876
877================= T I T L E  A M E N D M E N T =================
878     Remove the entire title and insert:
879
A bill to be entitled
880An act relating to prompt payment for construction
881services; amending s. 218.70, F.S.; providing a popular
882name; amending s. 218.72, F.S.; redefining terms used in
883pt. VII of ch. 218, F.S.; amending s. 218.735, F.S.;
884revising provisions relating to timely payment for
885purchases of construction services; revising deadlines for
886payment; providing procedures for project closeout and
887payment of retainage; providing requirements for local
888government construction retainage; providing that ss.
889218.72-218.76, F.S., apply to the payment of any payment
890request for retainage; providing exceptions; creating s.
891255.0705, F.S.; providing a popular name; amending s.
892255.071, F.S.; revising deadlines for the payment of
893subcontractors, sub-subcontractors, materialmen, and
894suppliers on construction contracts for public projects;
895creating ss. 255.072, 255.073, 255.074, 255.075, 255.076,
896255.077, and 255.078, F.S.; providing definitions;
897providing for timely payment for purchases of construction
898services by a public entity; providing procedures for
899calculating payment due dates; authorizing the collection
900of interest under certain circumstances; providing
901procedures for handling improper payment requests;
902providing for the resolution of disputes; providing for
903project closeout and payment of retainage; providing that
904ss. 255.072-255.076, F.S., apply to the payment of any
905payment request for retainage; providing exceptions;
906amending s. 255.05, F.S.; providing requirements for
907certain notices of nonpayment served by a claimant who is
908not in privity with the contractor; revising the form for
909a public construction bond; requiring the payment
910provisions of all public construction bonds to be
911construed as statutory bonds; prohibiting conversion to
912common law bonds; deleting a requirement that bond forms
913used by public owners reference certain notice and time
914limitation provisions; providing limitations on a
915claimant's institution of certain actions against a
916contractor or surety; amending s. 95.11, F.S., to conform
917a cross reference; providing for application of specified
918sections of the act to certain contracts and projects;
919providing an effective date.


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