Bill to extend prompt payment act


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Bipartisan legislation sponsored by Senator Steve Oroho would extend New Jersey’s “Prompt Payment Act” to State and local governments, boards of education, and independent State authorities, and reduce the time they to pay their bills without extra penalties has passed the New Jersey Senate.

“When a family hires a professional service or buys a product from a retailer, they have to pay our bills on time,” Senator Oroho stated. “Vendors who do business with our government should get paid just as quickly. There’s no reason we should stall payments that could put New Jersey’s small businesses at risk.”

The “New Jersey Prompt Payment Act” requires a State agency that is delinquent in making payment for the goods and services it purchases to make penalty payments including interest if the bill is not paid within 60 days of the due date.

Oroho’s legislation changes that deadline for delinquent payments from 60 to 45 days, and extends the law to independent State authorities, local government contracting units, and boards of education.

Additionally, the bill establishes that a public entity may waive the interest payment for a delinquency due to circumstances beyond the entity’s control, including but not limited to strikes or natural disasters.

“The consequences of government agencies lapsing on their bills can reach all New Jersey’s families,” Oroho added. “When one of our local employers is unpaid for the services they have profited, it affects their ability to pay their bills, including paychecks to their employees. New Jersey should work towards paying our bills as quickly as possible.”



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