Bill Summary for Bill Number SB09-095

Date: 02/09/2009

Final
BILL SUMMARY for SB09-095

SENATE COMMITTEE ON STATE, VETERANS & MILITARY AFFAIRS

Votes: View-->	Action Taken:
Moved a prepared amendment to Senate Bill 09-095, Moved that Senate Bill 09-095 be referred to the C	PASS PASS

02:52 PM -- Senate Bill 09-095

Senator Tapia, prime sponsor, presented Senate Bill 09-095, concerning payment of amounts due under a construction agreement. He said that the Colorado construction industry employs about 9 percent of the state's work force. He said that construction companies must be paid in a timely manner in order to meet payrolls in the industry. He noted that it takes from 53 to 90 days, on average, to receive payment at present in Colorado and that this time frame is problematic given the current state of credit markets. He said that Senate Bill 09-095 would establish a common set of rules for the making of such payments in Colorado. He noted that Senate Bill 09-095 does not apply to single family residential construction. He said that, nationally, 49 states have prompt payment statutes.

The following persons testified in reagrd to Senate Bill 09-095:

03:08 PM -- Pat Ratliff, representing the Colorado Water Congress, opposed Senate Bill 09-095 due to its inclusion of public entities.

03:12 PM -- Jim O'Neill, representing the City of Fort Collins, opposed Senate Bill 09-095, and commented on the city's contract documents. He said that the City of Fort Collins only delays payment on a contract in the case of disputes in billing.

03:15 PM -- John McCormick, representing Quest, opposed Senate Bill 09-095. He said that the requirements of Senate Bill 09-095 would negatively influence current contracting practices of his company.

03:17 PM -- Jim Johnson, representing the GE Johnson Construction and Colorado Concern, opposed Senate Bill 09-095. He said that he supports prompt payment, but that he believes that Senate Bill 09-095 will not stop "bad actors." He said that the bill interferes with private contracting and that prompt pay is not good business practice for the state.

03:20 PM -- David Broadwell, representing the City and County of Denver, said that the city has opposed this legislation in recent years. He questioned whether a statewide solution should be imposed. He commented on the impact that Senate Bill 09-095 would have on the city's contracts.

03:23 PM -- Don Eberle, representing the Special District Association of Colorado, opposed Senate Bill 09-095, and said that it will affect a public entity's control of its projects. He said that the problem of prompt pay for public entities is already addressed in Colorado law.

03:27 PM -- MaryAnn McGeady, representing the Special District Association of Colorado, commented on the impact of the current recession on local governments. She commented on protections for payment of contracts in the public sector. She said that Senate Bill 09-095 will complicate the existing local government process for the payment of contracts.

03:31 PM -- Chris Piper, representing the Denver Water Department, opposed Senate Bill 09-095. He said that Senate Bill 09-095 will result in the payment for contracts before a job may be satisfactorily completed.

03:35 PM -- Amy Harmon, Denver, representing herself, opposed Senate Bill 09-095, and commented on her experiences with payment on an underperforming contract.

03:39 PM -- Gary Megisson, representing the Associated General Contractors of Colorado, commented on receivables due at his company. He said that late payment is a common problem in the industry, and that accounts are much more current in the State of Arizona, a state that has recently adopted the prompt pay practice.

03:47 PM -- David Morrill, representing Concrete Frame Association, Inc., said that prompt payment is an issue in Colorado, and that the current system in the state is not working. He said that these slow payments affect credit and bonding of companies. He said that Senate Bill 09-095 is "a collaboration," and will be good for the Colorado construction industry.

03:51 PM -- Helga Grunerud, representing the Hispanic Contractors of Colorado, she said that there are greater opportunities in the private sector for minority contractors. She said that prompt pay is important for small minority-owned businesses because they have less access to capital.

03:54 PM -- John Meza, representing Meza Construction Company, said that opponents of Senate Bill 09-095 propose to do nothing to address the problem of late payments in Colorado. He said that the City of Fort Collins has a good reputation in regard to prompt payment of contract obligations.

04:02 PM -- John Logan, representing the National Association of Industrial and Office Properties, supported Senate Bill 09-095 and said that the bill was negotiated in good faith.

04:05 PM -- Dave Davia, representing the Colorado Association of Mechanical and Plumbing Contractors, said that 52 to 90 days is an excessive period of time for a company to forgo payment. He said that this issue is "large and systemic."


BILL:	SB09-095
TIME:	04:34:03 PM
MOVED:	Boyd
MOTION:	Moved a prepared amendment to Senate Bill 09-095, L.001 (Attachment C). The motion passed on a 4-1-0 roll call vote.
SECONDED:
		VOTE
	Boyd	Yes
	Cadman	Yes
	Schultheis	No
	Bacon	Yes
	Williams	Yes


Not Final YES: 4 NO: 1 EXC: 0 ABS: 0 FINAL ACTION: PASS


BILL:	SB09-095
TIME:	04:35:27 PM
MOVED:	Boyd
MOTION:	Moved that Senate Bill 09-095 be referred to the Committee on Appropriations, as amended. The motion passed on a 3-2-0 roll call vote.
SECONDED:
		VOTE
	Boyd	Yes
	Cadman	No
	Schultheis	No
	Bacon	Yes
	Williams	Yes


Final YES: 3 NO: 2 EXC: 0 ABS: 0 FINAL ACTION: PASS