SB 5176, which aims to ensure subcontractors on public works projects are paid in a timely manner, failed to pass the February 17 house-of-origin cutoff. AWC does not expect the bill to reappear this year and is unsure whether it will return next year.

We thank the member cities and many other stakeholders who collaborated with AWC staff in working on the bill.

Productive stakeholder work results in new compromises for prompt pay on public works

February 6, 2026

A years-long effort to pass legislation to ensure subcontractors on public works projects are paid in a timely manner may come to fruition this year.

SB 5176, sponsored by Sen. Javier Valdez (D–Seattle), returns this session with new provisions for prompt pay practices and supporting small and minority-owned businesses in cases when payment is not received on time.

The latest version of the bill reiterates that public project owners must make payments on public works projects within 30 days of receipt of a properly completed invoice (a requirement already codified elsewhere in statute). They must also provide “payment and invoicing” information in writing to contractors and subcontractors prior to the project, including a point of contact at the agency to whom payment inquiries may be directed. Furthermore, project owners must acknowledge receipt of a written payment or change order inquiry within five business days.

The updated bill removes a number of prescriptive requirements around contract terms and tracking of payments that drove up anticipated costs for owners. Those expected cost increases hindered passage of a prior version in 2025.

The new legislation clarifies that any person from whom funds have been wrongfully withheld on a public works project must be paid, by the person wrongfully withholding the funds, 1% per month in interest. That interest accrues every month that payment is not made. However, the bill excludes retainage from the amount that will accrue interest. In the case of good faith disputes over payment, public owners may withhold 100% of the disputed amount, a reduction from the current 150%.

A contractor or subcontractor seeking a change order from the project owner or upper tier contractor must request it no later than 30 days after commencement of authorized additional work. A contractor or subcontractor is not liable for interest to a lower tier contractor if a request for a change order was submitted and the project owner or upper tier contractor has not issued the change order in a timely manner. Finally, the bill allows an aggrieved party to bring a civil action for relief from violations of the prompt payment law, including interest and reasonable attorney fees and costs.

AWC fully supports the goals of the legislation and thanks the many public and private sector stakeholders who collaborated over the interim through the Capital Projects Advisory Review Board committee process to find viable compromises, balancing policy and practicality for the purpose of implementation.

SB 5176 was heard in the Senate Ways & Means Committee on February 5. It must be voted out of the committee by Monday, February 9, to have a chance of passing this year.