BILL REQ. #: S-0416.2
State of Washington | 63rd Legislature | 2013 Regular Session |
Read first time 01/23/13. Referred to Committee on Transportation.
AN ACT Relating to public contracts for transportation improvement projects; amending RCW 60.28.011, 39.08.030, 39.08.030, 39.12.040, 47.04.082, and 47.28.140; reenacting and amending RCW 39.08.010; adding a new section to chapter 47.28 RCW; providing an effective date; and providing an expiration date.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec. 1 RCW 60.28.011 and 2011 c 231 s 2 are each amended to read
as follows:
(1)(a) Except as provided in (b) of this subsection, public
improvement contracts shall provide, and public bodies shall reserve,
a contract retainage not to exceed five percent of the moneys earned by
the contractor as a trust fund for the protection and payment of: (i)
The claims of any person arising under the contract; and (ii) the state
with respect to taxes, increases, and penalties imposed pursuant to
Titles 50, 51, and 82 RCW which may be due from such contractor.
(b) Public improvement contracts ((involving the construction,
alteration, repair, or improvement of any highway, road, or street))
funded in whole or in part by federal transportation funds shall rely
upon the contract bond as referred to in chapter 39.08 RCW for the
protection and payment of: (i) The claims of any person or persons
arising under the contract to the extent such claims are provided for
in RCW 39.08.010; and (ii) the state with respect to taxes ((imposed
pursuant to)), increases, and penalties incurred on the public
improvement project under Titles 50, 51, and 82 RCW which may be due.
The contract bond must remain in full force and effect until, at a
minimum, all claims filed in compliance with chapter 39.08 RCW are
resolved.
(2) Every person performing labor or furnishing supplies toward the
completion of a public improvement contract shall have a lien upon
moneys reserved by a public body under the provisions of a public
improvement contract. However, the notice of the lien of the claimant
shall be given within forty-five days of completion of the contract
work, and in the manner provided in RCW 39.08.030.
(3) The contractor at any time may request the contract retainage
be reduced to one hundred percent of the value of the work remaining on
the project.
(a) After completion of all contract work other than landscaping,
the contractor may request that the public body release and pay in full
the amounts retained during the performance of the contract, and sixty
days thereafter the public body must release and pay in full the
amounts retained (other than continuing retention of five percent of
the moneys earned for landscaping) subject to the provisions of
chapters 39.12 and 60.28 RCW.
(b) Sixty days after completion of all contract work the public
body must release and pay in full the amounts retained during the
performance of the contract subject to the provisions of chapters 39.12
and 60.28 RCW.
(4) The moneys reserved by a public body under the provisions of a
public improvement contract, at the option of the contractor, shall be:
(a) Retained in a fund by the public body;
(b) Deposited by the public body in an interest bearing account in
a bank, mutual savings bank, or savings and loan association. Interest
on moneys reserved by a public body under the provision of a public
improvement contract shall be paid to the contractor;
(c) Placed in escrow with a bank or trust company by the public
body. When the moneys reserved are placed in escrow, the public body
shall issue a check representing the sum of the moneys reserved payable
to the bank or trust company and the contractor jointly. This check
shall be converted into bonds and securities chosen by the contractor
and approved by the public body and the bonds and securities shall be
held in escrow. Interest on the bonds and securities shall be paid to
the contractor as the interest accrues.
(5) The contractor or subcontractor may withhold payment of not
more than five percent from the moneys earned by any subcontractor or
sub-subcontractor or supplier contracted with by the contractor to
provide labor, materials, or equipment to the public project. Whenever
the contractor or subcontractor reserves funds earned by a
subcontractor or sub-subcontractor or supplier, the contractor or
subcontractor shall pay interest to the subcontractor or sub-subcontractor or supplier at a rate equal to that received by the
contractor or subcontractor from reserved funds.
(6) A contractor may submit a bond for all or any portion of the
contract retainage in a form acceptable to the public body and from a
bonding company meeting standards established by the public body. The
public body shall accept a bond meeting these requirements unless the
public body can demonstrate good cause for refusing to accept it. This
bond and any proceeds therefrom are subject to all claims and liens and
in the same manner and priority as set forth for retained percentages
in this chapter. The public body shall release the bonded portion of
the retained funds to the contractor within thirty days of accepting
the bond from the contractor. Whenever a public body accepts a bond in
lieu of retained funds from a contractor, the contractor shall accept
like bonds from any subcontractors or suppliers from which the
contractor has retained funds. The contractor shall then release the
funds retained from the subcontractor or supplier to the subcontractor
or supplier within thirty days of accepting the bond from the
subcontractor or supplier.
(7) If the public body administering a contract, after a
substantial portion of the work has been completed, finds that an
unreasonable delay will occur in the completion of the remaining
portion of the contract for any reason not the result of a breach
thereof, it may, if the contractor agrees, delete from the contract the
remaining work and accept as final the improvement at the stage of
completion then attained and make payment in proportion to the amount
of the work accomplished and in this case any amounts retained and
accumulated under this section shall be held for a period of sixty days
following the completion. In the event that the work is terminated
before final completion as provided in this section, the public body
may thereafter enter into a new contract with the same contractor to
perform the remaining work or improvement for an amount equal to or
less than the cost of the remaining work as was provided for in the
original contract without advertisement or bid. The provisions of this
chapter are exclusive and shall supersede all provisions and
regulations in conflict herewith.
(8) Whenever the department of transportation has contracted for
the construction of two or more ferry vessels, sixty days after
completion of all contract work on each ferry vessel, the department
must release and pay in full the amounts retained in connection with
the construction of the vessel subject to the provisions of RCW
60.28.021 and chapter 39.12 RCW. However, the department of
transportation may at its discretion condition the release of funds
retained in connection with the completed ferry upon the contractor
delivering a good and sufficient bond with two or more sureties, or
with a surety company, in the amount of the retained funds to be
released to the contractor, conditioned that no taxes shall be
certified or claims filed for work on the ferry after a period of sixty
days following completion of the ferry; and if taxes are certified or
claims filed, recovery may be had on the bond by the department of
revenue, the employment security department, the department of labor
and industries, and the material suppliers and laborers filing claims.
(9) Except as provided in subsection (1) of this section,
reservation by a public body for any purpose from the moneys earned by
a contractor by fulfilling its responsibilities under public
improvement contracts is prohibited.
(10) Contracts on projects funded in whole or in part by farmers
home administration and subject to farmers home administration
regulations are not subject to subsections (1) through (9) of this
section.
(11) This subsection applies only to a public body that has
contracted for the construction of a facility using the general
contractor/construction manager procedure, as defined under RCW
39.10.210. If the work performed by a subcontractor on the project has
been completed within the first half of the time provided in the
general contractor/construction manager contract for completing the
work, the public body may accept the completion of the subcontract.
The public body must give public notice of this acceptance. After a
forty-five day period for giving notice of liens, and compliance with
the retainage release procedures in RCW 60.28.021, the public body may
release that portion of the retained funds associated with the
subcontract. Claims against the retained funds after the forty-five
day period are not valid.
(12) Unless the context clearly requires otherwise, the definitions
in this subsection apply throughout this section.
(a) "Contract retainage" means an amount reserved by a public body
from the moneys earned by a person under a public improvement contract.
(b) "Person" means a person or persons, mechanic, subcontractor, or
materialperson who performs labor or provides materials for a public
improvement contract, and any other person who supplies the person with
provisions or supplies for the carrying on of a public improvement
contract.
(c) "Public body" means the state, or a county, city, town,
district, board, or other public body.
(d) "Public improvement contract" means a contract for public
improvements or work, other than for professional services, or a work
order as defined in RCW 39.10.210.
Sec. 2 RCW 39.08.010 and 2007 c 218 s 88 and 2007 c 210 s 3 are
each reenacted and amended to read as follows:
(1)(a) Whenever any board, council, commission, trustees, or body
acting for the state or any county or municipality or any public body
shall contract with any person or corporation to do any work for the
state, county, or municipality, or other public body, city, town, or
district, such board, council, commission, trustees, or body shall
require the person or persons with whom such contract is made to make,
execute, and deliver to such board, council, commission, trustees, or
body a good and sufficient bond, with a surety company as surety,
conditioned that such person or persons shall:
(i) Faithfully perform all the provisions of such contract ((and));
(ii) Pay all laborers, mechanics, and subcontractors and material
suppliers, and all persons who supply such person or persons, or
subcontractors, with provisions and supplies for the carrying on of
such work((, which)); and
(iii) Pay the taxes, increases, and penalties incurred on the work
project under Titles 50, 51, and 82 RCW.
(b) The bond, in cases of cities and towns, shall be filed with the
clerk or comptroller thereof, and any person or persons performing such
services or furnishing material to any subcontractor shall have the
same right under the provisions of such bond as if such work, services,
or material was furnished to the original contractor((: PROVIDED,
HOWEVER, That)).
(2) The provisions of RCW 39.08.010 through 39.08.030 shall not
apply to any money loaned or advanced to any such contractor,
subcontractor, or other person in the performance of any such work((:
PROVIDED FURTHER, That)).
(3) On contracts of thirty-five thousand dollars or less, at the
option of the contractor the respective public entity may, in lieu of
the bond, retain fifty percent of the contract amount for a period of
thirty days after date of final acceptance, or until receipt of all
necessary releases from the department of revenue, the employment
security department, and the department of labor and industries and
settlement of any liens filed under chapter 60.28 RCW, whichever is
later((: PROVIDED FURTHER, That)).
(4) For contracts of one hundred thousand dollars or less, the
public entity may accept a full payment and performance bond from an
individual surety or sureties((: AND PROVIDED FURTHER, That)).
(5) The surety must agree to be bound by the laws of the state of
Washington and subjected to the jurisdiction of the state of
Washington.
Sec. 3 RCW 39.08.030 and 2009 c 473 s 1 are each amended to read
as follows:
(1) The bond mentioned in RCW 39.08.010 shall be in an amount equal
to the full contract price agreed to be paid for such work or
improvement, except under subsections (2) and (3) of this section, and
shall be to the state of Washington, except as otherwise provided in
RCW 39.08.100, and except in cases of cities and towns, in which cases
such municipalities may by general ordinance fix and determine the
amount of such bond and to whom such bond shall run: PROVIDED, The
same shall not be for a less amount than twenty-five percent of the
contract price of any such improvement, and may designate that the same
shall be payable to such city, and not to the state of Washington, and
all such persons mentioned in RCW 39.08.010 shall have a right of
action in his, her, or their own name or names on such bond for work
done by such laborers or mechanics, and for materials furnished or
provisions and goods supplied and furnished in the prosecution of such
work, or the making of such improvements, and the state shall have a
right of action for the collection of taxes, increases, and penalties
specified in RCW 39.08.010: PROVIDED, That, except for the state with
respect to claims for taxes, increases, and penalties specified in RCW
39.08.010, such persons shall not have any right of action on such bond
for any sum whatever, unless within thirty days from and after the
completion of the contract with an acceptance of the work by the
affirmative action of the board, council, commission, trustees,
officer, or body acting for the state, county or municipality, or other
public body, city, town or district, the laborer, mechanic or
subcontractor, or material supplier, or person claiming to have
supplied materials, provisions or goods for the prosecution of such
work, or the making of such improvement, shall present to and file with
such board, council, commission, trustees or body acting for the state,
county or municipality, or other public body, city, town or district,
a notice in writing in substance as follows:
Sec. 4 RCW 39.08.030 and 2007 c 218 s 89 are each amended to read
as follows:
(1) The bond mentioned in RCW 39.08.010 shall be in an amount equal
to the full contract price agreed to be paid for such work or
improvement, except under subsection (2) of this section, and shall be
to the state of Washington, except as otherwise provided in RCW
39.08.100, and except in cases of cities and towns, in which cases such
municipalities may by general ordinance fix and determine the amount of
such bond and to whom such bond shall run: PROVIDED, The same shall
not be for a less amount than twenty-five percent of the contract price
of any such improvement, and may designate that the same shall be
payable to such city, and not to the state of Washington, and all such
persons mentioned in RCW 39.08.010 shall have a right of action in his,
her, or their own name or names on such bond for work done by such
laborers or mechanics, and for materials furnished or provisions and
goods supplied and furnished in the prosecution of such work, or the
making of such improvements, and the state shall have a right of action
for the collection of taxes, increases, and penalties specified in RCW
39.08.010: PROVIDED, That, except for the state with respect to claims
for taxes, increases, and penalties specified in RCW 39.08.010, such
persons shall not have any right of action on such bond for any sum
whatever, unless within thirty days from and after the completion of
the contract with an acceptance of the work by the affirmative action
of the board, council, commission, trustees, officer, or body acting
for the state, county or municipality, or other public body, city, town
or district, the laborer, mechanic or subcontractor, or material
supplier, or person claiming to have supplied materials, provisions or
goods for the prosecution of such work, or the making of such
improvement, shall present to and file with such board, council,
commission, trustees or body acting for the state, county or
municipality, or other public body, city, town or district, a notice in
writing in substance as follows:
Sec. 5 RCW 39.12.040 and 2012 c 129 s 1 are each amended to read
as follows:
(1)(a) Except as provided in subsection (2) of this section, before
payment is made by or on behalf of the state, or any county,
municipality, or political subdivision created by its laws, of any sum
or sums due on account of a public works contract, it shall be the duty
of the officer or person charged with the custody and disbursement of
public funds to require the contractor and each and every subcontractor
from the contractor or a subcontractor to submit to such officer a
"Statement of Intent to Pay Prevailing Wages". For a contract in
excess of ten thousand dollars, the statement of intent to pay
prevailing wages shall include:
(((a))) (i) The contractor's registration certificate number; and
(((b))) (ii) The prevailing rate of wage for each classification of
workers entitled to prevailing wages under RCW 39.12.020 and the
estimated number of workers in each classification.
(b) Each statement of intent to pay prevailing wages must be
approved by the industrial statistician of the department of labor and
industries before it is submitted to the disbursing officer. Unless
otherwise authorized by the department of labor and industries, each
voucher claim submitted by a contractor for payment on a project
estimate shall state that the prevailing wages have been paid in
accordance with the prefiled statement or statements of intent to pay
prevailing wages on file with the public agency. Following the final
acceptance of a public works project, it shall be the duty of the
officer charged with the disbursement of public funds, to require the
contractor and each and every subcontractor from the contractor or a
subcontractor to submit to such officer an ((")) affidavit of wages
paid((")) before the funds retained according to the provisions of RCW
60.28.011 are released to the contractor. On a public works project
where no retainage is withheld pursuant to RCW 60.28.011(1)(b), the
affidavit of wages paid must be submitted to the state, county,
municipality, or other public body charged with the duty of disbursing
or authorizing disbursement of public funds prior to final acceptance
of the public works project. If a subcontractor performing work on a
public works project fails to submit an (("))affidavit of wages
paid((")) form, the contractor or subcontractor with whom the
subcontractor had a contractual relationship for the project may file
the forms on behalf of the nonresponsive subcontractor. Affidavit
forms may only be filed on behalf of a nonresponsive subcontractor who
has ceased operations or failed to file as required by this section.
((Filings made on behalf of a subcontractor may not be accepted sooner
than thirty-one days after the acceptance date of the public works
project and)) The contractor filing the affidavit must accept
responsibility for payment of prevailing wages unpaid by the
subcontractor on the project pursuant to RCW 39.12.020 and 39.12.065.
Intentionally filing a false affidavit on behalf of a subcontractor
subjects the filer to the same penalties as are provided in RCW
39.12.050. Each affidavit of wages paid must be certified by the
industrial statistician of the department of labor and industries
before it is submitted to the disbursing officer.
(2) As an alternate to the procedures provided for in subsection
(1) of this section, for public works projects of two thousand five
hundred dollars or less and for projects where the limited public works
process under RCW 39.04.155(3) is followed:
(a) An awarding agency may authorize the contractor or
subcontractor to submit the statement of intent to pay prevailing wages
directly to the officer or person charged with the custody or
disbursement of public funds in the awarding agency without approval by
the industrial statistician of the department of labor and industries.
The awarding agency shall retain such statement of intent to pay
prevailing wages for a period of not less than three years.
(b) Upon final acceptance of the public works project, the awarding
agency shall require the contractor or subcontractor to submit an
affidavit of wages paid. Upon receipt of the affidavit of wages paid,
the awarding agency may pay the contractor or subcontractor in full,
including funds that would otherwise be retained according to the
provisions of RCW 60.28.011. Within thirty days of receipt of the
affidavit of wages paid, the awarding agency shall submit the affidavit
of wages paid to the industrial statistician of the department of labor
and industries for approval.
(c) A statement of intent to pay prevailing wages and an affidavit
of wages paid shall be on forms approved by the department of labor and
industries.
(d) In the event of a wage claim and a finding for the claimant by
the department of labor and industries where the awarding agency has
used the alternative process provided for in this subsection (2) ((of
this section)), the awarding agency shall pay the wages due directly to
the claimant. If the contractor or subcontractor did not pay the wages
stated in the affidavit of wages paid, the awarding agency may take
action at law to seek reimbursement from the contractor or
subcontractor of wages paid to the claimant, and may prohibit the
contractor or subcontractor from bidding on any public works contract
of the awarding agency for up to one year.
(e) Nothing in this section shall be interpreted to allow an
awarding agency to subdivide any public works project of more than two
thousand five hundred dollars for the purpose of circumventing the
procedures required by subsection (1) of this section.
Sec. 6 RCW 47.04.082 and 1967 c 108 s 1 are each amended to read
as follows:
As used in ((this act the term)) chapter 108, Laws of 1967, "urban
public transportation system" ((shall)) means a system for the public
transportation of persons or property by buses, streetcars, trains,
electric trolley coaches, other public transit vehicles, or any
combination thereof operating in or through predominantly urban areas
and owned and operated by the state, any public agency, any city or
county or any municipal corporation of the state, including all
structures, facilities, vehicles and other property rights and interest
forming a part of such a system.
Sec. 7 RCW 47.28.140 and 1991 c 322 s 29 are each amended to read
as follows:
When in the opinion of the governing authorities representing the
department and any public agency, instrumentality, municipal
corporation, or political subdivision of the state of Washington, any
highway, road, ((or)) street, or urban public transportation system
will be benefited or improved by constructing, reconstructing,
locating, relocating, laying out, repairing, surveying, altering,
improving, or maintaining, or by the establishment adjacent to, under,
upon, within, or above any portion of any such highway, road, ((or))
street ((of an)), or urban public transportation system, by either the
department or any public agency, instrumentality, municipal
corporation, or political subdivision of the state, and it is in the
public interest to do so, the authorities may enter into cooperative
agreements wherein either agrees to perform the work and furnish the
materials necessary and pay the cost thereof, including necessary
engineering assistance, which costs and expenses shall be reimbursed by
the party whose responsibility it was to do or perform the work or
improvement in the first instance. The work may be done by either day
labor or contract, and the cooperative agreement between the parties
shall provide for the method of reimbursement. In the case of some
special benefit or improvement to a state highway derived from any
project that assists in preventing or minimizing flood damages as
defined in RCW 86.16.120 or from the construction of any public works
project, including any urban public transportation system, the
department may contribute to the cost thereof by making direct payment
to the particular state department, agency, instrumentality, municipal
corporation, or political subdivision on the basis of benefits
received, but such payment shall be made only after a cooperative
agreement has been entered into for a specified amount or on an actual
cost basis prior to the commencement of the particular public works
project.
NEW SECTION. Sec. 8 A new section is added to chapter 47.28 RCW
to read as follows:
When the department plans to perform a project or work for another
public agency, instrumentality, municipal corporation, or political
subdivision that provides no benefit or improvement to a state highway
and the public agency, instrumentality, municipal corporation, or
political subdivision plans to perform a project or work for the
department, the department may waive application of its indirect costs
by entering into a reciprocal agreement with the public agency,
instrumentality, municipal corporation, or political subdivision in
which each party agrees to waive indirect costs related to a project or
work that will be performed by the party for the other party's benefit.
The reciprocal agreement must specify the project or work to be
performed by each party and may be for a maximum term of ten years,
unless amended by the parties. The reimbursement requirements of RCW
47.04.140, 39.34.130, and 43.09.210 are deemed to be satisfied by the
completion of each party's project or work under the reciprocal
agreement.
NEW SECTION. Sec. 9 Section 3 of this act expires June 30, 2016.
NEW SECTION. Sec. 10 Section 4 of this act takes effect June 30,
2016.