On June 12, Gov. Tom Wolf signed Pennsylvania Act 27 into law, adding significant additional protections to the Contractor and Subcontractor Payment Act, or CASPA. CASPA was originally passed in 1994, and outlines payment guidelines and protections for contractors, subcontractors and suppliers who work on many privately owned construction projects in the state. In addition to setting forth minimal payment timelines and procedures, CASPA defines what constitutes a wrongful withholding of payment for completed work and mandatory penalties (including statutory interest, penalties and attorney fees) which will be assessed by a court or arbitrator where the statute is violated.

The changes signed into law will go into effect on Oct. 10—120 days after it was signed—and further clarify certain aspects of CASPA which were left unanswered in the original legislation, often leading to disputes between parties as they negotiated contracts for a project or proceeded with work once it was underway.

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