House Bill No. 638, introduced by Representative Jacob Landry, seeks to amend R.S. 9:2784 to improve the payment process for contractors and subcontractors in Louisiana. The bill mandates that owners or their representatives must pay contractors within 35 days of receiving a written payment request, unless there are legal reasons to withhold payment. If payments are delayed, contractors can impose a penalty of 1.5% of the unpaid amount per day, starting the day after the payment is due. Additionally, contractors are required to pay subcontractors and suppliers within seven days of receiving payment from the owner, including any accrued interest. The bill also addresses good faith disputes, ensuring that undisputed amounts are paid promptly, and introduces penalties for non-compliance, including the ability to recover court costs and attorney fees.

Significantly, the bill repeals the existing exemption for residential property improvements from these payment requirements, thereby extending the law's applicability to such projects. It also clarifies that the new regulations do not apply to contracts with public entities and outlines specific exemptions for agreements related to oil, natural gas, and mineral services. The legislation includes technical amendments, such as defining key terms and establishing a penalty for late payments at a rate of 1.5% per month, which begins accruing the day after the payment due date. Overall, the bill aims to enhance financial protections for contractors and subcontractors in the construction industry while ensuring timely payments.

Statutes affected:
HB638 Original: 9:2784(A)
HB638 Engrossed: 9:2784(A)
HB638 Reengrossed: