Magazine article Business Credit

New Kansas Law Defines Prompt Payment for Construction Industry

Magazine article Business Credit

New Kansas Law Defines Prompt Payment for Construction Industry

Article excerpt

The playing field has leveled a little for contractors, subcontractors and suppliers in the construction industry in Kansas as Governor Kathleen Sebelius signed into law the Kansas Fairness in Private Construction Act, also known as Senate bill 33.

Proponents of the bill, including NACM Kansas City Division, the local affiliate of the National Association of Credit Management, and the American Subcontractors Association agree that this legislation will encourage more prompt payment bills around the nation.

Senator Laura Kelly, D-Topeka, said this legislation is a precedent-setting, bi-partisan piece that will draw national eyes toward Kansas.

"It was built around fairness, which is good for the general public," she said. "We have set a model for the rest of the country."

The new law redefines prompt payment for members of the construction supply chain doing business in Kansas. For example, a contractor must send payment to a subcontractor within seven business days of when they were paid by the owner. Then, the subcontractor has an additional seven business days to pay the material suppliers. With written notice and an additional seven business days, an unpaid contractor or subcontractor has the right to stop work without being subject to penalties, despite what's written in their contract. The contractor or subcontractor can also take their claim to court in the county where the real property is located. The law also adds interest at 18 percent per annum for owners 31 or more days past due on their construction bills. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.