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States' Contractor Protection Policies Come Under Fire in New Study

Dec 1, 2004 12:00 PM

The American Subcontractors Association (ASA) recently released a report that outlines the state of the nation's public policies

The American Subcontractors Association (ASA) recently released a report that outlines the state of the nation's public policies, and they say the results are “a call to arms to the construction industry.” According to “The ASA Report: The Policy Environment in the United States,” in 2004, every state except one received an overall grade of “F” for public policies that affect construction subcontractors and suppliers. New Mexico earned a “D.”

ASA calculated the overall grade for each state by scoring seven state policy areas: prompt payment protections; treatment of pay-if-paid clauses; mechanic's lien protection; payment bond protections; retainage limitations; anti-indemnity protections, like limits on additional insured endorsements; and anti-bid shopping measures. E. Colette Nelson, ASA executive vice-president, says that although all but one state failed, there still were significant differences among their grades. “Some states, such as California, New York, and Missouri, are within striking distance of moving out of the failing category with a few reforms, while others, such as District of Columbia, New Hampshire, West Virginia, and Wyoming, are light years behind,” Nelson says. This is the inaugural annual evaluation of state policies and ASA will continue to track each state's progress.

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