To amend section 4113.61 of the Revised Code to require owners of private construction projects to timely pay contractors.
HB288 would revise Ohio’s prompt-payment law for construction projects by requiring private owners to pay contractors within 30 days after a proper payment request, or 30 days after certification of compliance for projects requiring architect or engineer approval, whichever is later. It also requires contractors to pay subcontractors and material suppliers within 10 days after receiving payment from the owner, and extends similar prompt-payment obligations down the chain to lower-tier subcontractors and material suppliers. Laborers must be paid wages due within 10 days after payment is received, and the bill applies the same timing rules to retainage payments when final retainage is released.
The bill adds a strong enforcement mechanism: unpaid amounts accrue interest at 18% per year beginning on the 11th or 31st day after payment is due, depending on the tier, and a prevailing party in a civil action may recover reasonable attorney fees and court costs unless the court finds that fee-shifting would be inequitable. The bill also makes any contractual waiver of these interest, fee, or cost rights void as against public policy, while preserving retainage and lien-related withholding in limited circumstances. It excludes single-, two-, and three-family detached homes, and it does not apply to certain oil, gas, pipeline, mine, and well-service agreements.
In practical terms, the bill would amend and replace existing section 4113.61 of the Revised Code, expanding and clarifying Ohio’s payment protections for participants in private construction projects. It would affect owners, general contractors, subcontractors, material suppliers, lower-tier subcontractors and suppliers, and laborers by imposing mandatory payment deadlines and interest penalties for late payment. The bill also defines key terms such as owner, private owner, public owner, contractor, lower-tier subcontractor, and lower-tier material supplier, and it expressly preserves certain contract terms unless they conflict with the bill’s shorter deadlines or higher interest rate.
The general sentiment reflected in the available legislative history appears favorable, as the House vote on June 18, 2025 was 8-4 for favorable passage. No committee transcript was provided, so there is no recorded debate to indicate detailed support or opposition arguments. The favorable vote suggests broad support among committee members for strengthening payment timeliness in the construction industry.
The main points of contention likely center on the bill’s strict payment deadlines, the high 18% interest penalty, and the limits it places on private contracting freedom by voiding contrary waiver provisions. Potential opponents may also object to the bill’s reach down the subcontracting chain and to the attorney-fee provisions, while supporters are likely to emphasize cash-flow protection for contractors, subcontractors, suppliers, and laborers and the reduction of payment delays on private construction projects.
HB288 would substantially revise Ohio’s private-construction prompt-payment statute, section 4113.61 of the Revised Code, by imposing specific payment deadlines, mandatory interest penalties for late payment, and fee-shifting remedies for unpaid parties. It would create enforceable payment rights for contractors, subcontractors, material suppliers, lower-tier subcontractors and suppliers, and laborers, while preserving limited retainage and lien-related withholding. The bill would not apply to single-, two-, or three-family detached homes, and it would exclude certain oil, gas, pipeline, mine, and well-service agreements. Existing section 4113.61 would be repealed and replaced, with the new provisions taking effect six months after the act’s effective date.
The available voting history indicates generally favorable sentiment toward the bill, with the House Small Business Committee reporting it out 8-4 on June 18, 2025. No committee transcript was provided, so there is no direct record of floor-style debate or stakeholder testimony. Based on the vote, supporters appear to view the measure as a needed payment-protection and cash-flow reform for the construction industry, while the opposition was significant enough to produce four no votes.
Likely points of contention include the bill’s 18% annual interest penalty for late payment, which is relatively aggressive and may be viewed by some as punitive. Another likely dispute is the bill’s restriction on contract terms that would extend payment periods or reduce the statutory interest rate, which limits private bargaining flexibility. The bill’s extension of prompt-payment obligations through multiple tiers of subcontractors and suppliers may also raise administrative and compliance concerns, while supporters would argue that these provisions are necessary to protect smaller firms and laborers from payment delays.