In Arizona, there are a number of different Prompt Payment statutes governing both
public and private projects. A common misconception in the construction industry and
even among legal practitioners is that ARS §32-1129.01 to §32-1129.06 apply to all Arizona
projects–regardless of whether the project is new or remodeled residential, commercial, or
work for the State or other public agency. The typical Prompt Payment statute referred to
in most legal articles relates only to private projects, which make up only a small fraction of
all construction projects in Arizona. This has been especially true for the past 5 years (2007
– 2011), when private lending has been difficult—if not impossible—to obtain for new
development.
An analysis of the Prompt Payment statutes applicable to work performed for the
various state agencies, cities, towns, school districts, counties, and for the State University
system have been uniformly ignored by most legal authors. What follows is a summary of
each of the various statutes and codes applicable to the majority of construction projects in
Arizona—both private and public. (The scope of this article is not intended to address the
Prompt Payment statutes and regulations for work performed for the federal government2,
or work performed on tribal lands.)
Read Full Text Here: Arizona Prompt Payment Statutes
AN ANALYSIS OF ARIZONA PROMPT PAYMENT STATUTES
GUY W. BLUFF, ESQ.
I. ARIZONA’S PROMPT PAYMENT STATUTES
A. The “General Rule”
B. Objections Must be In Writing and Specific
II. SUMMARY OF STATUTORY AND CODE PROVISIONS
A. Private Projects – ARS §32-1129.01 to ARS §32-1129.05
B. Interpreting Case Authority
1. Stonecreek Building Co., Inc. v. Shure, 216 Ariz. 36, 162 P.3d 675 (CA1, 2007)
2. Slaton Bros. SW, LLC v. Bozrah Builders, Inc. (WL 1434683 (CA1, 2011).(Not Reported)
C. Counties, Cities, Special Districts – ARS §34-221
D. Arizona Department of Transportation – ARS §28-6924
E. State Agencies – Arizona State Procurement Code – ARS §41-2577
F. Arizona State University System –Board of Regents Policy Manual §3-804(G & H).
G. School District Procurement Code – Arizona Administrate Code R7-2-1114, R7-2-1115
III. STATUTORY AND CODE PROVISIONS (FULL TEXT)
A. Private Projects – ARS §32-1129.01 to ARS §32-1129.05
1. 32-1129.01. Progress payments by owner; conditions; interest
2. 32-1129.02. Performance and payment by contractor, subcontractor or material supplier; conditions; interest
B. Counties, Cities, Special Districts – ARS §34-221 1. 34-221. Contract with successful bidder; payments to contractor; security; recovery of damages by contractor for delay; progress payments
C. Arizona Department of Transportation – ARS §28-6924 1. 28-6924. Progress payments
D. Arizona State Procurement Code – ARS §41-2577 1. 41-2577. Progress payments
E. Arizona State University System – Az Board of Regents Policy §3-804(G & H).
1. §3-804(G). Contract Payment Retention
2. §3-804(H). Progress Payment
F. School District Procurement Code – Arizona Administrate Code R7-2-1114, R7-2-1115
1. R7-2-1114. Contract Payment Retention and Substitute Security
2. R7-2-1115. Progress Payments