HB24 Alabama 2014 Session

Summary

Primary Sponsor

William Roberts

Republican

Session

Regular Session 2014

Title

Contracts, payment of state contractors, state may not increase time for payment beyond 30 days, time frame to hold pre-bid meetings specified, review of invoices in specified time frame required, alteration of contract allowed under certain circumstances, Sec. 39-2-2, 39-2-12 am'd.

Summary

HB24 updates Alabama public works contracts to speed payments, tighten bid procedures, and expand retainage and contract-change rules.

What This Bill Does

It requires pre-bid meetings at least seven days before bid opening and bars last-minute specification changes within 24 hours of bid opening. It speeds up payment to contractors and establishes clearer progress-review and invoice-dispute procedures. It also allows contract terms to be adjusted for material changes or unknown site conditions and introduces new options for managing retainage, including escrow arrangements, with funding-related rules and exceptions.

Who It Affects

• Contractors and nonresident contractors: face faster payment timelines (approximately 35 days after acceptance, with interest for late payments), new retainage/escrow options, clarified invoice dispute procedures, progress reviews, and tax-payment requirements before final payment.
• Awarding authorities (state, counties, municipalities, and the Department of Transportation): must follow revised bid advertising and pre-bid meeting rules, oversee progress reviews and payment processing within set timelines, and have authority to alter contracts for material or unknown conditions while ensuring funds are available.

Key Provisions

• Pre-bid meetings must be held at least seven days before bid opening.
• Specifications may not be modified within 24 hours of bid opening.
• Public bidding requirements apply to contracts over $50,000, with broad advertising and statewide notices for larger projects (DOT exception).
• Partial payments and final payments are due within 35 days after acceptance (with final payment timing reflecting 35- or 45-day terms in different contexts); interest applies to late payments.
• Designated review of progress must occur within 10 days (20 days for DOT); disputed invoices must be addressed with written reasons and procedures for resolution.
• Retainage is capped at 5% and generally is not withheld after 50% completion; DOT has special exceptions.
• Escrow accounts may replace retainage under specified conditions, with rules for eligible banks, investments, interest flows, and withdrawal procedures.
• Contractors may substitute securities for retainage (types of securities listed) and must deposit equivalent collateral; securities are held to protect payment obligations.
• If funds are not available until after contract execution (grants or reimbursements), prompt payment does not apply until funds are received; once available, payments follow defined processing timelines.
• Differing site conditions must be reported within 10 days; the architect/engineer assesses and may recommend contract term adjustments for cost or time changes.
• Overpayment remedies: if overpayment is found, the contractor must repay within 60 days; failure can lead to disqualification from future DOT or county contracts until repaid, plus interest on the overpayment.
• Certain entities (e.g., Alabama Building Commission) and emergency or disaster-related contracts have exemptions from these provisions.
• Effective date: the act takes effect on the first day of the third month after passage.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

State Agencies