What must recipients do to ensure compliance with the requirement that subcontractors (which includes subconsultants) must be promptly paid for work performed on a U.S. Department of Transportation funded (DOT-assisted) contract?
When are prime contractors required to return retainage to subcontractors?
Does the prompt payment and release of retainage requirements apply only to DBE subcontractors?
When does the time period for payment or release of retainage begin to run?
How does a delay in payment by the recipient affect the prompt payment obligation imposed on contractors?
What happens when there is a dispute over the satisfactory completion of the work performed by the subcontractor?
What effect does the absence of a direct relationship between the recipient and the subcontractor have on the obligation imposed on the recipient under the DBE program regulations?
Is the obligation to promptly pay subcontractors a material term of a DOT-assisted contract?
What are some of the contractual penalties that may be imposed by a recipient when a subcontractor is not promptly paid?
How are prompt payment complaints processed?
Is relying on complaints an appropriate means of enforcing the prompt payment and retainage requirements of the rule?
What records should recipients and contractors retain to document compliance with the prompt payment requirement?
The General Counsel of the Department of Transportation has reviewed these questions and answers and approved them as consistent with the language and intent of 49 CFR Part 26. These questions and answers therefore represent the institutional position of the Department of Transportation. These questions and answers provide guidance and information for compliance with the provisions under 49 CFR part 26, pertaining to the implementation of the Department’s disadvantaged business enterprise program. Like all guidance material, these questions and answers are not, in themselves, legally binding or mandatory, and do not constitute regulations. They are issued to provide an acceptable means, but not the only means, of compliance with Part 26. While these questions and answers are not mandatory, they are derived from extensive DOT, recipient, and contractor experience and input concerning the determination of compliance with Part 26.