Legislative Priorities 2009
Bills Filed or Sponsored by ASM
ASM filed or co-sponsored bills on Beacon Hill for the 2009-10 legislative session, many of them relating to payment for work performed, which is the leading business concern for subcontractors.
We want to extend a public “thank you” to the Senators and Representatives who filed the bills on our behalf. Several of the bills are co-sponsored jointly with other industry organizations, reflecting ASM’s commitment to working cooperatively with all members of the building team for changes that benefit the entire industry.
"Prompt Pay" (H.1804)
Also called “Fairness in Private Construction Contracts,” the Prompt Pay bill was filed by Rep. David Flynn (Bridgewater) and Sen. Mark Pacheco (Taunton) for ASM.
Overview: ASM’s Prompt Payment Task Force drafted this legislation, modeling it on laws passed in Kansas, Arizona, Connecticut, New York and other states. The bill addresses the systemic problem of slow payment in the construction industry by requiring all private construction contracts to include fair payment terms, with reasonable times to make payments and strong incentives to pay timely.
The proposed legislation promotes “prompt payment” as the industry standard, and applies payment requirements equitably to all parties involved in a project, including owners, general contractors, subcontractors and sub-subcontractors.
History: This bill was first filed in 2007 and made remarkable progress in the 2007-08 session, moving through several Committees to reach the House Committee on Third Reading. The rapid advance stirred opposition, however, and the legislative session expired before the bill could come to the floor for a vote.
Status: Currently before the Joint Committee on Labor and Workforce Development - chaired by Sen. Thomas McGee (Lynn) and Rep. Cheryl Coakley-Rivera (Springfield). ASM is currently negotiating with the AGC of Massachusetts on potential changes to the bill that will result in a compromise version that will win broader support.
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Restrictions on Pay-if-Paid (H.3053)
The "Pay-if-Paid" bill was filed for ASM by Rep. Martin Walsh (Dorchester) and Sen. Stephen Brewer (Barre). It is co-sponsored by AGC and supported by the 21-member Massachusetts Construction Industry Council.
Overview: The bill promotes fairness in construction contracts by restricting the use of “pay-if-paid” language that says a subcontractor gets paid only if the general contractor gets paid. The bill allows pay-if-paid only if nonpayment is due to problems with the subcontractor's work, or if the general contractor files notice of contract at the start of a project and takes all reasonable steps to secure payment.
Representing a compromise negotiated with AGC, the bill integrates perfectly with the state’s mechanics lien law, and replaces ASM’s past legislation which proposed to ban pay-if-paid clauses altogether.
History: This bill was enacted in 2004 but was vetoed by Governor Romney, due to mis-understanding of the bill. It was re-filed in 2005 and again in 2007, and each time was reported favorably by the Joint Committee on State Administration, and advanced to House Ways & Means. ASM launched a grassroots campaign in 2008 that brought attention to the bill, but it was not enough to get it moving, and the bill died in Committee at the end of the 2008 session.
Status: Currently before the Joint Committee on State Administration, chaired by Sen. Brian Joyce (Milton) and Rep. Steven Walsh (Lynn).
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Indemnity / Insurance Liability Reform (S.1406)
The Indemnity / Insurance Liability Reform legislation was filed by Sen. Stephen Buoniconti (Springfield) for ASM.
Overview: The bill prohibits any provision in a construction contract that requires general contractors or subcontractors to provide indemnification or insurance to cover damage or injuries caused by other parties. It calls for all parties to take responsibility for their own negligence and pay costs in proportion to their fault. It does not diminish the responsibility of all parties to pay 100% of damages to injured plaintiffs, but simply changes the way the contracting parties agree to allocate the costs among themselves.
This bill does not present a new concept; it is what the law originally intended, until a court decision changed the interpretation. S.1406 is all about fairness in sharing risks and costs.
History: This bill won Senate approval in 2002, but has been stalled since then due to opposition from owners, architects and trial attorneys who may misunderstand the intent of the bill, and the impact. In the 2007-08 session, it was reported favorabily by the Joint Committee on State Administration, and advanced to Senate Ways & Means. A grassroots effort by ASM rallied some support by failed to get action on the bill, and it died in Committee at the end of the session.
Status: Currently before the Joint Committee on State Administration, chaired by Sen. Brian Joyce (Milton) and Rep. Steven Walsh (Lynn).
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Construction Reform Technical Corrections (H.2971)
Overview: The omnibus "Technical Corrections Bill" includes numerous critical corrections, including some of a substantive nature, to the Construction Reform legislation of 2004.
Status: Currently before the Joint Committee on State Administration, chaired by Sen. Brian Joyce (Milton) and Rep. Steven Walsh (Lynn).
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"Right to Suspend" (H.3022)
This bill was filed for ASM by Rep. Michael Rodriques (Dartmouth), and is officially titled, a bill "To Limit the Losses of Subcontractors in Private Construction."
Overview: This bill, filed for the first time in 2009, provides a limited solution to slow payment / nonpayment problems in the industry, by prohibiting any Contract Provision that would require a subcontractor to keep working after an extended period of nonpayment, provided nonpayment is not due to deficiencies in performance. The bill does not guarantee fast or timely payment, but does allow the subcontractor to stop work without penalty if he isn't paid, in time to avoid financial ruin.
Status: Currently before the Joint Committee on State Administration, chaired by Sen. Brian Joyce (Milton) and Rep. Steven Walsh (Lynn).
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Clarification of the Law on Proprietary Specifications (H.2967)
Also called the “three or equal” bill, it was filed for ASM by Rep. Antonio Cabral (New Bedford).
Overview: The bill clarifies the rule on “proprietary specifications” to promote competition in the procurement of materials for building projects. It requires designers to list three brands that are acceptable, or three manufacturers who can meet the specifications. The bill would also stop the practice of naming “proprietary” items without good reason and without giving detailed product specifications.
History: This bill represents a merger of a bill filed in past years by ASM and a similar one filed separately by the Inspector General of the Commonwealth. In 2007-08, it was reported favorably by the Joint Committee on State Administration, but died in House Ways & Means at the end of the session.
Status: Currently before the Joint Committee on State Administration, chaired by Sen. Brian Joyce (Milton) and Rep. Steven Walsh (Lynn).
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Fair Utility Competition (H.3513)
Filed by Rep. Michael Costelly (Newburyport) for the Massachusetts Alliance for Fair Utility Competition, a coalition of union and nonunion groups that includes ASM.
Overview: The bill adds teeth to existing regulations that prohibit gas and electric utilities from “cross subsidizing” their affiliated service companies with money they get from their ratepayers. It would stop utilities from providing manpower, vehicles, equipment or marketing support that give their affiliates an unfair advantage in competing against small business HVAC and electrical contractors.
History: The alliance overcame stiff opposition from utility unions in 2006 to win broad support in the legislature, but ultimately died after receiving a favorable report from Senate Ways & Means. It was re-filed in 2007 and again advanced to Senate Ways & Means, butt failed to gain momentum due to continuing opposition from utility unions.
Status: Currently before the Joint Committee on Telecommunications, Utilities and Energy chaired by Sen. Michael Morrissey (Quincy) and Rep. Barry Finegold (Andover).
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Special Thanks to our Corporate Sponsors
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