ARIZONA HOUSE OF REPRESENTATIVES
Second Regular Session
Senate: GOV DP 6-0-1-0 | 3rd Read 30-0-0-0
House: COM DP 8-0-0-1
SB 1510: public contracts; payment methods
Sponsor: Senator Livingston, LD 22
Adds an assignment of money market account and demand deposit accounts as a substitute for the retention of pay estimates.
Statute requires a construction contract include a provision that 10% of all estimates be retained as a guarantee for complete performance. In lieu of the required retention and at the option of the contractor, the agent must accept as a substitute an assignment of time certificates of deposit, securities of the U.S., this state, counties, municipalities and school districts, or shares of savings and loan associations in an amount equal to 10% of all estimates. The contractor is entitled to receive all interest or income earned by such security as it accrues. (A.R.S. § 34-211).
Agent is defined as: 1) any county, city or town, or officer, board or commission of any county, city or town, and irrigation, power, electrical, drainage, flood protection and flood control districts, tax levying public improvement districts and county or city improvement districts; and 2) Includes any county board of supervisors and any representative authorized by an agent to act as an agent for the purpose of authorizing necessary change orders to previously awarded contracts in accordance with guidelines established by rule of the agent, including the board of supervisors.
Contractor is defined as any person who has a contract with an agent. (A.R.S. § 34-101)
1. Includes an assignment of money market account and demand deposit accounts as a substitute for the required retention of pay estimates of a construction contract. (Sec. 1)
2. Clarifies the agent, in a construction contract, may not accept a money market account or demand deposit account as a substitute unless the accounts are accompanied by a signed waiver of the bank of any right or power to setoff against either the agent or the contractor. (Sec. 1)
3. Requires written authorization of the agent before monies deposited in a money market account or demand deposit account can be released by the financial institution to the contactor. (Sec. 1)
4. Makes technical changes. (Sec. 1)
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8. SB 1510
9. Initials PRB Page 0 House Engrossed
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