Amend SB 311 on third reading as follows:
      In Article 9 of the bill (House Committee Report), add two
new Sections, appropriately numbered, to read as follows:
      SECTION __. Section 2252.031, Government Code, is amended to
read as follows:
      Sec. 2252.031. DEFINITIONS. In this subchapter:
            (6) "Subcontractor" means a person who provides public
work, labor, or material to fulfill an obligation to a prime
contractor or subcontractor for the performance or installation of
any work required by a public works contract.
      SECTION __. Section 2252.032, Government Code, is amended to
read as follows:
      Sec. 2252.032. RETAINAGE. (a) A governmental entity shall:
            (1) deposit in an interest-bearing account the
retainage of a public works contract <that provides for retainage
of more than five percent of the periodic contract payment>; and
            (2) pay the interest earned on the retainage to the
prime contractor <on completion of the contract>.
      (b) A prime contractor shall pay to a subcontractor from whom
retainage is withheld the percentage of the interest received from
a governmental entity that is attributable to the subcontractor's
work.
      (c) A subcontractor shall pay to its subcontractor from whom
retainage is withheld the percentage of the interest received from
the prime contractor that is attributable to its subcontractor's
work.
      (d) A person obligated to pay interest under Subsection (a),
(b), or (c) shall pay the interest within the period prescribed for
payment by Chapter 2251.
      (e) If a governmental entity is obligated to pay interest
under this section and does not make the interest payments within
the period prescribed by Subsection (d), interest accrues for the
overdue payments in the manner and at the rate prescribed by
Chapter 2251, less interest of the interest-bearing account.
      (f) If a prime contractor or subcontractor is obligated to
pay interest under this section and does not make the interest
payments within the period prescribed by Subsection (d), interest
accrues for the overdue payments in the manner and at the rate
prescribed by Chapter 2251.