HOUSE FILE _____

BY  (PROPOSED COMMITTEE ON JUDICIARY BILL BY CHAIRPERSON ANDERSON)

A BILL FOR

An Act concerning the retention of funds due to contractors on public improvements.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

   Section 1.  Section 573.15, Code 2011, is amended to read as follows:
   573.15  Exception.
   1.  No A part of the unpaid fund due the contractor shall not be retained as provided in this chapter on claims for labor performed or material furnished, other than materials labor or material ordered by the general contractor or the general contractor’s authorized agent, unless such claims are supported by a certified statement that the person performing the labor or furnishing the material for which the claim is made has done all of the following:
   a.  Provided the general contractor had been notified with written notice within thirty days after the materials are furnished or by itemized invoices rendered to contractor during the progress of the work, of the amount, kind, and value of the material furnished for use upon the said public improvement, and no of first performing the labor or furnishing the material for which a claim may be made of the name, mailing address, and telephone number of the person performing the labor or furnishing the material and the name of the person for whom the labor was performed or to whom the material was furnished. The written notice shall be accompanied with copies of all purchase orders, contracts, or subcontracts under which the labor was performed or the material was furnished.
   b.  Provided the general contractor by written notice within five days following the end of any month during which that person performed labor for or furnished material to a subcontractor on that project of the number of invoices or pay requests the person submitted to the subcontractor during that month, the invoice or pay request numbers identifying those invoices or pay requests, and the total dollar amount of those invoices or pay requests.
   2.  The certified statement shall be accompanied by copies of the notices required by subsection 1, paragraphs“a” and “b”. A public corporation shall not retain any part of such the unpaid fund due the contractorshall be retained as provided in this chapter because of the commencement of any action by the contractor against the state department of transportation under authority granted in section 613.11.
EXPLANATION
   Current law provides an exception to the requirement that a public corporation retain a portion of funds due a contractor on a public improvement project in a fund for the payment of claims for materials furnished and labor performed. The exception provides that a public corporation need only retain funds due a supplier of material to a general contractor if the supplier provides the general contractor with one of two permitted types of notice after the materials are supplied.
   This bill provides that the exception shall apply to both claims for labor and claims for material. The bill also amends the notice requirement to provide that a supplier of labor or material to a general contractor must give both types of notice for the exception to apply. The bill makes certain modifications to the two types of notice.