SB 383 - This act modifies the Missouri Public Prompt Payment Act and the law relating to public works projects.
Currently, a public owner may retain 5% of the value of a public works contract or up to 10% if it is determined by the public owner and the architect or engineer determine that a higher rate is required to ensure performance. This act repeals these provisions and does not allow retainage if the public owner has obtained a bond. Retainage of up to 5% is allowed by the public owner if the public owner is not required to obtain a bond. Contractors are not allowed to retain amounts owed to subcontractors.
Under current law, retainage may be adjusted prior to completion when work is proceeding satisfactorily and retainage is paid after substantial completion of the contract or per contract terms. In such cases, 200% of the value of the remaining work is withheld until completion. This act repeals this provision.
Under current law, the contractor or subcontractor may withhold certifications to the owner or contractor for payment to the subcontractor or material supplier for many reasons including that the contract cannot be completed for the amount of retainage. This provision is repealed.
Currently, in contracts which provide for payments to the contractor based upon estimates of materials and work performed rather than certifications, the public owner may retain 5% from the amount due. This act repeals this provision.
Currently, contractors on public works projects are obligated to require contractors to furnish a bond when the estimated cost of the project exceeds $25,000. This act changes that amount to $50,000.
This act is similar to SB 862 (2012), and HB 641 (2013).