Prompt Payment for Fixed-Price Architect-Engineer Contracts
(52.232-26)(OCT 2003)

Notwithstanding any other payment terms in this contract, the Government
will make invoice payments under the terms and conditions specified in
this clause. The Government considers payment as being made on the day a
check is dated or the date of an electronic funds transfer. Definitions
of pertinent terms are set forth in sections 2.101, 32.001, and 32.902
of the Federal Acquisition Regulation. All days referred to in this
clause are calendar days, unless otherwise specified. (However, see
paragraph (a)(3) of this clause concerning payments due on Saturdays,
Sundays, and legal holidays.)

\(a\) Invoice payments\--(1) Due date. The due date for making invoice
payments is\--

> \(i\) For work or services completed by the Contractor, the later of
> the following two events:
>
> \(A\) The 30th day after the designated billing office receives a
> proper invoice from the Contractor (except as provided in paragraph
> (a)(1)(iii) of this clause).
>
> \(B\) The 30th day after Government acceptance of the work or services
> completed by the Contractor. For a final invoice, when the payment
> amount is subject to contract settlement actions (e.g., release of
> claims), acceptance is deemed to occur on the effective date of the
> settlement.
>
> \(ii\) The due date for progress payments is the 30th day after
> Government approval of Contractor estimates of work or services
> accomplished.
>
> \(iii\) If the designated billing office fails to annotate the invoice
> or payment request with the actual date of receipt at the time of
> receipt, the payment due date is the 30th day after the date of the
> Contractor\'s invoice or payment request, provided the designated
> billing office receives a proper invoice or payment request and there
> is no disagreement over quantity, quality, or Contractor compliance
> with contract requirements.

\(2\) Contractor\'s invoice. The Contractor shall prepare and submit
invoices to the designated billing office specified in the contract. A
proper invoice must include the items listed in paragraphs (a)(2)(i)
through (a)(2)(x) of this clause. If the invoice does not comply with
these requirements, the designated billing office will return it within
7 days after receipt, with the reasons why it is not a proper invoice.
When computing any interest penalty owed the Contractor, the Government
will take into account if the Government notifies the Contractor of an
improper invoice in an untimely manner.

> \(i\) Name and address of the Contractor.
>
> \(ii\) Invoice date and invoice number. (The Contractor should date
> invoices as close as possible to the date of mailing or transmission.)
>
> \(iii\) Contract number or other authorization for work or services
> performed (including order number and contract line item number).
>
> \(iv\) Description of work or services performed.
>
> \(v\) Delivery and payment terms (e.g., discount for prompt payment
> terms).
>
> \(vi\) Name and address of Contractor official to whom payment is to
> be sent (must be the same as that in the contract or in a proper
> notice of assignment)
>
> \(vii\) Name (where practicable), title, phone number, and mailing
> address of person to notify in the event of a defective invoice.
>
> \(viii\) Taxpayer Identification Number (TIN). The Contractor shall
> include its TIN on the invoice only if required elsewhere in this
> contract.
>
> \(ix\) Electronic funds transfer (EFT) banking information.
>
> \(A\) The Contractor shall include EFT banking information on the
> invoice only if required elsewhere in this contract.
>
> \(B\) If EFT banking information is not required to be on the invoice,
> in order for the invoice to be a proper invoice, the Contractor shall
> have submitted correct EFT banking information in accordance with the
> applicable solicitation provision (e.g., 52.232-38, Submission of
> Electronic Funds Transfer Information with Offer), contract clause
> (e.g., 52.232-33, Payment by Electronic Funds Transfer\--Central
> Contractor Registration, or 52.232-34,Payment by Electronic Funds
> Transfer\--Other Than Central Contractor Registration), or applicable
> agency procedures.
>
> \(C\) EFT banking information is not required if the Government waived
> the requirement to pay by EFT.
>
> \(x\) Any other information or documentation required by the contract.

\(3\) Interest penalty. The designated payment office will pay an
interest penalty automatically, without request from the Contractor, if
payment is not made by the due date and the conditions listed in
paragraphs (a)(3)(i) through (a)(3)(iii) of this clause are met, if
applicable. However, when the due date falls on a Saturday, Sunday, or
legal holiday, the designated payment office may make payment on the
following working day without incurring a late payment interest penalty.

> \(i\) The designated billing office received a proper invoice.
>
> \(ii\) The Government processed a receiving report or other Government
> documentation authorizing payment and there was no disagreement over
> quantity, quality, Contractor compliance with any contract term or
> condition, or requested progress payment amount.
>
> \(iii\) In the case of a final invoice for any balance of funds due
> the Contractor for work or services performed, the amount was not
> subject to further contract settlement actions between the Government
> and the Contractor.

\(4\) Computing penalty amount. The Government will compute the interest
penalty in accordance with the Office of Management and Budget prompt
payment regulations at 5 CFR part 1315.

> \(i\) For the sole purpose of computing an interest penalty that might
> be due the Contractor, Government acceptance or approval is deemed to
> occur constructively as shown in paragraphs (a)(4)(i)(A) and (B) of
> this clause. If actual acceptance or approval occurs within the
> constructive acceptance or approval period, the Government will base
> the determination of an interest penalty on the actual date of
> acceptance or approval. Constructive acceptance or constructive
> approval requirements do not apply if there is a disagreement over
> quantity, quality, Contractor compliance with a contract provision, or
> requested progress payment amounts. These requirements also do not
> compel Government officials to accept work or services, approve
> Contractor estimates, perform contract administration functions, or
> make payment prior to fulfilling their responsibilities.
>
> \(A\) For work or services completed by the Contractor, Government
> acceptance is deemed to occur constructively on the 7th day after the
> Contractor completes the work or services in accordance with the terms
> and conditions of the contract.
>
> \(B\) For progress payments, Government approval is deemed to occur on
> the 7th day after the designated billing office receives

the Contractor estimates.

> \(ii\) The prompt payment regulations at 5 CFR 1315.10(c) do not
> require the Government to pay interest penalties if payment delays are
> due to disagreement between the Government and the Contractor over the
> payment amount or other issues involving contract compliance, or on
> amounts temporarily withheld or retained in accordance with the terms
> of the contract. The Government and the Contractor shall resolve
> claims involving disputes, and any interest

that may be payable in accordance with the clause at FAR 52.233-1,
Disputes.

\(5\) Discounts for prompt payment. The designated payment office will
pay an interest penalty automatically, without request from the
Contractor, if the Government takes a discount for prompt payment
improperly. The Government will calculate the interest penalty in
accordance with 5 CFR part 1315.

\(6\) Additional interest penalty. (i) The designated payment office
will pay a penalty amount, calculated in accordance with the prompt
payment regulations at 5 CFR part 1315, in addition to the interest
penalty amount only if\--

> \(A\) The Government owes an interest penalty of \$1 or more;
>
> \(B\) The designated payment office does not pay the interest penalty
> within 10 days after the date the invoice amount is paid; and
>
> \(C\) The contractor makes a written demand to the designated payment
> office for additional penalty payment, in accordance with paragraph
> (a)(6)(ii) of this clause, postmarked not later than 40 days after the
> date the invoice amount is paid.
>
> (ii)(A) The Contractor shall support written demands for additional
> penalty payments with the following data. The Government will not
> request any additional data. The Contractor shall\--
>
> \(1\) Specifically assert that late payment interest is due under a
> specific invoice, and request payment of all overdue late payment
> interest penalty and such additional penalty as may be required;
>
> \(2\) Attach a copy of the invoice on which the unpaid late payment
> interest is due; and
>
> \(3\) State that payment of the principal has been received, including
> the date of receipt.
>
> \(B\) If there is no postmark or the postmark is illegible\--
>
> \(1\) The designated payment office that receives the demand will
> annotate it with the date of receipt, provided the demand is received
> on or before the 40th day after payment was made; or
>
> \(2\) If the designated payment office fails to make the required
> annotation, the Government will determine the demand\'s validity based
> on the date the Contractor has placed on the demand, provided such
> date is no later than the 40th day after payment was made.
>
> \(iii\) The additional penalty does not apply to payments regulated by
> other Government regulations (e.g., payments under utility contracts
> subject to tariffs and regulation).

\(b\) Contract financing payments. If this contract provides for
contract financing, the Government will make contract financing payments
in accordance with the applicable contract financing clause.

\(c\) Overpayments. If the Contractor becomes aware of a duplicate
contract financing or invoice payment or that the Government has
otherwise overpaid on a contract financing or invoice payment, the
Contractor shall immediately notify the Contracting Officer and request
instructions for disposition of the overpayment.

(End of clause)