How to Get Paid on Public Projects in Iowa and Nebraska: The Little Miller Act

Amazing! How to Get Paid on Public Projects in Iowa and Nebraska: The Little Miller Act

Information about How to Get Paid on Public Projects in Iowa and Nebraska: The Little Miller Act

Phil Puccio

Congress enacted the Miller Act to provide protections to contractors who provide labor and materials for federal projects. Many states, including Nebraska and Iowa, have enacted Little Miller Acts that provide equal protections for state and county public projects. These laws require prime contractors on certain government contracts to carry a performance bond to protect the government from delays and incomplete work. Insureds must also provide payment guarantees to protect material suppliers and subcontractors.

Ultimately, these measures help to create competition, keep costs down and ensure projects are paid for. Here is important information for Nebraska and Iowa:

Nebraska’s Little Miller Law:

In Nebraska, general contractors are required to post a payment guarantee equal to the minimum value of the contract price. Payment guarantees are not required for government projects valued at $15,000 or less or local projects valued at $10,000 or less. These guarantees must be filed, approved and retained by the government agency issuing the contract.

Subcontractors who provide labor or materials do not have to file a claim, but must wait at least 90 days after the last payment is due before filing a claim. A lawsuit must be filed within one year of the final settlement of the contract by the public body. Remember that the final bill does not mean the final payment.

If a subcontractor has entered into a contract with another subcontractor, the sub-subcontractor must notify the general contractor of its intention to claim the deposit from the general contractor within 4 months of the work being carried out or materials being provided for the project. This notice must be sent by registered or registered mail or delivered personally to the General Contractor. Although not required, it is a good idea to provide this notice to the bonding company as well.

Iowa Little Miller Act:

In Iowa, payment guarantees are required when the contract price is $25,000 or more. The amount of the security deposit is determined and approved by the government agency at a minimum of 75% of the contract price. In the case of contracts in which part of the contract price is only paid after completion of the project, the deposit may not be less than 25% of the contract price.

Subcontractors providing labor or materials may submit a detailed and affidavit of written entitlement to the government agency contracting the public works. These claims can be asserted at any time before the end of 30 days after the completion and acceptance of a public projection. The Iowa Little Miller Act allows a court to allow late claims if such claim does not materially delay litigation. However, it is advisable to assert the claim in good time.

Similar to Nebraska, in Iowa the statute of limitations for bringing a bond action is 1 year from the date the work is accepted. A subcontractor may bring an action for enforcement of the deposit after 30 days from the end of the project but no later than 60 days from the completion and final acceptance of the project.

Conclusion:

While the Little Miller Acts can protect subcontractors who provide labor or materials for public projects, it is critical for subcontractors to understand the requirements for making a bail bond claim. Failure to meet deadlines can result in a complete ban on collection. If you have any questions or need help getting paid for a public project, we encourage you to get in touch an experienced construction lawyer.

Thanks to Callie Kanthack for writing this article.

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Original Source: https://www.ldmlaw.com/2022/03/how-to-get-paid-on-public-projects-in-iowa-and-nebraska-the-little-miller-act/
Category – Construction

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