• to establish policy for prompt payment of invoices

1. "Good faith dispute" means a contention by an agency that goods delivered or services rendered were of a lesser quantity or quality than ordered or specified by contract, were faulty or were installed improperly; or any other reason giving cause for the withholding of payment by the agency until the dispute is settled.
   
   
2. "Improper invoices" means an invoice presented for payment not submitted with adequate or correct information for processing. Examples include incorrect price, cash discount not shown, incorrect reference to purchase order number and submittal to the incorrect address for processing.

1. The state will pay its invoices promptly. The state normally will pay properly submitted vendor invoices within 30 days of receipt, providing goods and/or services have been delivered, installed (if required), and accepted as specified. Payment will be considered timely if the payment is mailed, delivered, or transferred by the later of the following:
   
   
   1. The date specified on a properly completed invoice for the amount specified in the order or contract.

2. Within 30 days after receipt of a properly completed invoice or receipt and acceptance of the property or service under the order or contract or within 30 days after receipt of an improperly completed invoice or receipt and acceptance of the property or service under the order or contract, whichever is later if the agency does not notify the sender of receipt of an improperly completed invoice within 10 working days after it receives the invoice of the reason it is improperly completed.
   

2. An agency which does not pay timely the amount due on an order or contract will pay interest on the balance due from the 31st day after receipt of a properly completed invoice or receipt and acceptance of the property or service under the order or contract, whichever is later. Additionally, an agency which does not notify the sender of the invoice within 10 working days of receipt of an improperly completed invoice will pay interest on the balance due from the 31^st day after receipt of an improperly completed invoice or receipt and acceptance of the property or service under the order or contract, whichever is later.
   
   
3. Agency’s staff receiving goods/services should use the attached format or facsimile to notify their agency purchasing office of good faith disputes or improperly completed invoices.

4. A good faith dispute is resolved when both parties have agreed to a remedy. Once the procuring agency has written documentation of the remedy or a corrected invoice is received if required, the agency has 30 days to pay the invoice.
   
   
5. The attached form is a sample notice that agency may send to the vendor as notice of the improperly completed invoice or good faith dispute.

6. Agencies which notify the sender of an improperly completed invoice within 10 days of receipt, have 30 days to pay the invoice once the deficiency in the invoice has been corrected.

7. Exceptions to the 30-day payment requirement are:
   
   
   1. Any portion of an order or contract under which the payment is made from federal moneys.
      
      
   2. An order or contract that is subject to late payment interest or another late payment charge required by another law or rule specifically authorized by law.
      
      
   3. An order or contract between two or more agencies.
      
      
   4. An order or contract for services which provides for the time of payment and the consequences of nontimely payment.
      
      
   5. An order or contract under which the amount due is subject to a good faith dispute if, before the date payment is not timely, notice of the dispute is sent by first class mail, personally delivered or sent in accordance with the procedure specified in the order or contract.
   
   
8. Partial receipt of an order and invoice for that partial shipment does not constitute a proper invoice for purposes of prompt payment unless agreed to by the agency.
   
   
9. Discounts for early payment.
   
   
   1. The state normally will pay properly submitted vendor invoices within 30 days.
      
      
   2. Discounts will be paid in accordance with the vendor’s stated terms provided they meet the following conditions:
      
      
      1. Minimum time period considered for a cash discount is 15 days.
         
         
      2. Minimum amount considered is 2% of the invoice or $20, whichever is higher.
         
         
   3. To accept a discount for early payment, an agency will contact its Financial Operations office to assure payment can be made within the stated time period.
      

Sample: Notice (to purchasing/financial operations) of Good Faith Dispute/Improper Invoice

Sample: Notice to Vendor of Good Faith Dispute or Improper Invoice