Home>Payment Q&As>Can I get intertest on a late payment for construction services ordered under a PO by a State of Maryland agency?

Can I get intertest on a late payment for construction services ordered under a PO by a State of Maryland agency?

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My company performed and emergency leak repair for Coppin State University (Maryland University System) in June under a purchase order issued by the University procurement department. The PO specified payment terms of net 25. They are currently over 90 days past the 25 and have not yet paid us. Their A/P manager says they (the State of Maryland) are exempt from interest on late payments. Is that so?

1 reply

Nov 5, 2020

While the State of Maryland is not exempt from interest on late payments, and is in fact subject to a 9% interest rate per annum on late payments provided certain conditions are met, the University System of Maryland ("USM") is exempt from the general procurement law applicable to the rest of the state government. Rather, USM is subject to its own "Procurement Policies and Procedures" manual, some of which adopts the regulations which apply to the rest of state government, and some of which do not. It does appear to be correct that the USM is exempt from the general state interest law on claims.

It appears, however, that your focus should be more toward elevating this matter to a formal "claim" against USM, depending on the size of the outstanding payable. I am happy to discuss this further with you if you'd like.

Good luck!   

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