Overview of Prompt Payment to Contractors on State Governmental Construction Projects

Texas state agencies and political subdivisions (counties, municipalities, public school districts, and special-purpose districts/authorities) must pay general contractors within 30 days of the later of the date the governmental authority receives (a) goods under the construction contract; (b) services under the construction contract; or (c) an invoice for the goods/services.prompt payment contractors texas governmental projects

The general contractors, in turn, must pay their subcontractors within 10 days after the general contractors receive payment.

These time frames do not apply if there is a bona fide dispute about the goods delivered or the service performed that causes the payment to be late.

More details in future posts. For information on prompt payment on private projects, click here.

In our Law 101 posts, we define terms, phrases, or concepts with the goal of conveying core information in order to set the stage for more complex discussions.

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