Florida Senate - 2019                        COMMITTEE AMENDMENT
       Bill No. SB 246
       
       
       
       
       
       
                                Ì214284-Î214284                         
       
                              LEGISLATIVE ACTION                        
                    Senate             .             House              
                  Comm: RCS            .                                
                  02/12/2019           .                                
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       The Committee on Governmental Oversight and Accountability
       (Hooper) recommended the following:
       
    1         Senate Amendment (with title amendment)
    2  
    3         Delete lines 95 - 100
    4  and insert:
    5         Section 3. Subsection (8) of section 218.735, Florida
    6  Statutes, is amended to read:
    7         218.735 Timely payment for purchases of construction
    8  services.—
    9         (8)(a) With regard to any contract for construction
   10  services, a local governmental entity may withhold from each
   11  progress payment made to the contractor an amount not exceeding
   12  5 10 percent of the payment as retainage until 50-percent
   13  completion of such services.
   14         (b) After 50-percent completion of the construction
   15  services purchased pursuant to the contract, the local
   16  governmental entity must reduce to 2.5 5 percent the amount of
   17  retainage withheld from each subsequent progress payment made to
   18  the contractor. For purposes of this subsection, the term “50
   19  percent completion” has the meaning set forth in the contract
   20  between the local governmental entity and the contractor or, if
   21  not defined in the contract, the point at which the local
   22  governmental entity has expended 50 percent of the total cost of
   23  the construction services purchased as identified in the
   24  contract together with all costs associated with existing change
   25  orders and other additions or modifications to the construction
   26  services provided for in the contract. However, notwithstanding
   27  this subsection, a municipality having a population of 25,000 or
   28  fewer, or a county having a population of 100,000 or fewer, may
   29  withhold retainage in an amount not exceeding 5 10 percent of
   30  each progress payment made to the contractor until final
   31  completion and acceptance of the project by the local
   32  governmental entity.
   33         (c) After 50-percent completion of the construction
   34  services purchased pursuant to the contract, the contractor may
   35  elect to withhold retainage from payments to its subcontractors
   36  at a rate higher than 2.5 5 percent. The specific amount to be
   37  withheld must be determined on a case-by-case basis and must be
   38  based on the contractor’s assessment of the subcontractor’s past
   39  performance, the likelihood that such performance will continue,
   40  and the contractor’s ability to rely on other safeguards. The
   41  contractor shall notify the subcontractor, in writing, of its
   42  determination to withhold more than 2.5 5 percent of the
   43  progress payment and the reasons for making that determination,
   44  and the contractor may not request the release of such retained
   45  funds from the local governmental entity.
   46         (d) After 50-percent completion of the construction
   47  services purchased pursuant to the contract, the contractor may
   48  present to the local governmental entity a payment request for
   49  up to one-half of the retainage held by the local governmental
   50  entity. The local governmental entity shall promptly make
   51  payment to the contractor, unless the local governmental entity
   52  has grounds, pursuant to paragraph (f), for withholding the
   53  payment of retainage. If the local governmental entity makes
   54  payment of retainage to the contractor under this paragraph
   55  which is attributable to the labor, services, or materials
   56  supplied by one or more subcontractors or suppliers, the
   57  contractor shall timely remit payment of such retainage to those
   58  subcontractors and suppliers.
   59         (e) This section does not prohibit a local governmental
   60  entity from withholding retainage at a rate less than 5 10
   61  percent of each progress payment, from incrementally reducing
   62  the rate of retainage pursuant to a schedule provided for in the
   63  contract, or from releasing at any point all or a portion of any
   64  retainage withheld by the local governmental entity which is
   65  attributable to the labor, services, or materials supplied by
   66  the contractor or by one or more subcontractors or suppliers. If
   67  a local governmental entity makes any payment of retainage to
   68  the contractor which is attributable to the labor, services, or
   69  materials supplied by one or more subcontractors or suppliers,
   70  the contractor shall timely remit payment of such retainage to
   71  those subcontractors and suppliers.
   72         (f) This section does not require the local governmental
   73  entity to pay or release any amounts that are the subject of a
   74  good faith dispute, the subject of a claim brought pursuant to
   75  s. 255.05, or otherwise the subject of a claim or demand by the
   76  local governmental entity or contractor.
   77         (g) The time limitations set forth in this section for
   78  payment of payment requests apply to any payment request for
   79  retainage made pursuant to this section.
   80         (h) Paragraphs (a)-(d) do not apply to construction
   81  services purchased by a local governmental entity which are paid
   82  for, in whole or in part, with federal funds and are subject to
   83  federal grantor laws and regulations or requirements that are
   84  contrary to any provision of the Local Government Prompt Payment
   85  Act.
   86         (i) This subsection does not apply to any construction
   87  services purchased by a local governmental entity if the total
   88  cost of the construction services purchased as identified in the
   89  contract is $200,000 or less.
   90         Section 4. (1) This act does not apply to any contract for
   91  construction services which is entered into or is pending
   92  approval by a public entity, as defined in s. 255.072, Florida
   93  Statutes, or to any construction services project advertised for
   94  bid by the public entity, on or before July 1, 2019.
   95         (2) The amendments made to ss. 255.05 and 255.078, Florida
   96  Statutes, by this act do not apply to contracts executed under
   97  Chapter 337, Florida Statutes.
   98         Section 5. This act shall take effect July 1, 2019.
   99  
  100  
  101  ================= T I T L E  A M E N D M E N T ================
  102  And the title is amended as follows:
  103         Delete lines 2 - 10
  104  and insert:
  105         An act relating to public construction; amending
  106         255.05, F.S.; revising requirements for Department of
  107         Management Services rules governing certain contracts;
  108         amending s. 255.078, F.S.; revising the amounts of
  109         retainage that certain public entities and contractors
  110         may withhold from progress payments for any
  111         construction services contract; amending s. 218.735;
  112         revising the amounts of retainage that certain public
  113         entities and contractors may withhold from progress
  114         payments for any construction services contract;
  115         specifying nonapplicability of the act; providing an
  116         effective date.