Bill
SB 1980
Extends prompt-payment protections to Capital Development Board contracts, requiring downstream payments within 10 business days or 15 calendar days, with admin enforcement.
Status & key dates
- Introduced by Sen. Willie Preston on 2/6/2025 (bill text lists 2/6/2025; docket entries also show activity in March–May 2025).
- Passed the Senate 4/30/2025. Received in the House 5/1/2025.
- Referred through various House committees with public hearings; committee report sent to Calendars on 5/24/2025.
- Companion bill: HB 3665.
Purpose
- SB 1980 amends Section 7 of the State Prompt Payment Act to strengthen and clarify prompt-payment protections on Illinois public construction contracts. The principal change is to extend certain contractor payment restrictions and remedial procedures that previously applied to the Department of Transportation (DOT) to also apply to contracts administered by the Capital Development Board (CDB).
Key provisions and changes
- Expanded scope: The prohibition on a contractor offsetting, decreasing, or diminishing payments that are due to subcontractors or material suppliers (previously applied only to DOT contracts) is amended to apply to construction contracts with DOT or the Capital Development Board.
- Timing for downstream payments:
- When a contractor receives payment from the State for work, it must pay each subcontractor and material supplier promptly: no later than 10 business days or 15 calendar days after receipt of the payment (whichever is earlier).
- If payment is by printed check, the check must be postmarked within that same period.
- The obligation applies to payments down the contracting chain — each tier must pay its own subcontractors and suppliers on the same prompt timetable.
- Notice requirement for withheld payment:
- If a contractor refuses to make prompt payment within the timeline, it must provide a written notice to the subcontractor/supplier and the public owner (DOT or CDB) no later than 5 calendar days after receipt of payment.
- The notice must identify relevant contracts, state the detailed reason for withholding, the dollar amount withheld, and remedial actions required to trigger payment.
- Interest and enforcement:
- If a contractor, without reasonable cause, withholds payment beyond the prompt-payment window, interest is assessed on amounts due (text specifies a 2% rate tied to each 10-business-day or 15-calendar-day period; the bill text is partially fragmented on the precise calculation).
- A subcontractor or supplier may file a written notice and request an administrative hearing with the State official/agency administering the public construction contract. The State must schedule proceedings; an administrative law judge can find a violation and order payment of the owed amounts plus interest (the judge’s order requires payment within 15 calendar days).
- The bill establishes rights to counsel, cross-examination, and continuances for good cause in the hearing process.
Who is affected
- Beneficiaries: subcontractors and material suppliers on state-funded DOT and Capital Development Board public construction projects (explicitly protects all tiers — “regardless of tier”).
- Obligated parties: prime contractors on DOT and CDB construction contracts, and state officials/agencies administering those contracts (responsible for notice/administrative processes).
- Indirectly affects project cash flow, contract administration, and compliance processes for firms working on state construction projects.
Procedural/implementation notes and uncertainties
- The bill text in the provided excerpt is partially fragmented/truncated in sections describing interest computation and subsequent enforcement steps. The core protections — expanded anti-offset provision, strict 10-business-day/15-calendar-day payment deadline, required written notices, and administrative hearing remedy — are clear.
- Final implementation will depend on any further amendments and the final enrolled bill language once House consideration concludes.
Bottom line
- SB 1980 strengthens prompt-payment protections on Illinois public construction projects by (1) extending DOT-focused protections to Capital Development Board contracts, (2) imposing strict timelines for downstream payments to subcontractors and suppliers at all tiers, (3) requiring written notices when payments are withheld, and (4) providing an administrative enforcement mechanism including interest and orders to pay.
Compiled from official sources — confirm details with the bill’s official record.
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