INTEREST ON CONSTRUCTION CONTRACT CLAIMS - 8473.1

Public Contract Code (PCC) section 10261.5 provides for the payment of interest on construction contracts at an annual rate set forth in Code of Civil Procedure (CCP) section 685.010 when an agency/department fails to pay a construction contractor's properly submitted and undisputed payment request within 30 days of receipt of such request.

Agencies/Departments shall pay interest in accordance with PCC section 10261.5, at the rate specified in CCP section 685.010 if:

• The agency/department independently calculates the amount due on a progress payment, and the payment is not made within 30 days of the contractor’s first submittal of the payment request.
• The State Controller’s Office (SCO) has processed the payment within 15 days or less of receipt of a properly submitted and undisputed contractor’s request, and payment is not made within 30 days.

The SCO shall pay interest in accordance with PCC section 10261.5, at the rate specified in CCP section 685.010, if all of the following conditions are met:

• Payment is not made within 30 days of receipt of a properly submitted and undisputed contractor’s request.
• The contracting agency/department has filed the payment request within 15 days of receipt, and the SCO has accepted the payment request.
•  The SCO processed the payment after 15 days of the receipt of the request.