Bill > A5731

This bill amends existing construction contract payment laws to limit the amount that a State agency can withhold from contractors to two percent of the amount due on each partial payment, provided the contractor has submitted a performance bond within 15 days of the contract award. The limitation applies specifically to State agencies as property owners and is designed to provide more predictable payment terms for contractors. However, the bill includes an important exception: if a contractor has been terminated for cause at any point in the previous five years, the State agency retains the discretion to withhold more than two percent of the partial payment. This provision aims to balance contractor protections with the State's ability to manage financial risk on construction projects, ensuring that contractors with a history of poor performance can be more closely monitored. The bill takes effect immediately upon enactment, signaling the Legislature's intent to quickly implement these new payment guidelines for State construction contracts.

Labor and Employment

https://www.njleg.state.nj.us/bill-search/2024/A5731