The development and implementation of the prompt payment act Senate Bill 1131

Abstract

The enactment of Public Law 97-177 is considered a most effective directive for improving the Government's bill paying practices. This study, undertaken to investigate the need for such legislation and to analyze procedures established to implement the law, indicate the law has the potential for improving the Government bill paying reputation. Additionally, business concerns will be assisted in improving cash-flow problems generated by the slow bill paying practices of the Government. Problems inherent in the implementation of this law are: reconciling prompt bill payment with Federal cash management practices; ensuring contract funds are not channeled into nonproductive interest payment; reducing the administrative burden created to monitor bill payment and interest penalty payment; assigning responsibility for late payments and funding of interest payments .