Indiana Public Works Payment Bond Claims: Notice Requirements and Deadlines for Subcontractors on State Projects
If you are a subcontractor or supplier on a State of Indiana public works project, such as work at a state park, a state office building or a correctional facility, you cannot record a mechanic's lien when you are not paid. Public property is not subject to mechanic's liens in Indiana. That does not leave you without a remedy. Indiana law gives you two: a claim against the general contractor's payment bond, and a claim against the contract funds the State is still holding. Both depend on one document filed on time.
This article explains who is protected, what notice is required, and the deadlines that control an Indiana payment bond claim on a State project.
Which Indiana Statute Applies to Your Project?
Indiana has several public works statutes, and the rules are not the same. The first step is always to identify who let the contract.
- State projects. Projects bid through the Indiana Department of Administration, Public Works Division, are governed by Indiana Code 4-13.6-7. This article covers these projects.
- Local projects. Projects for counties, cities, towns and school corporations are generally governed by Indiana Code 36-1-12-13.1, which requires signed duplicate statements filed with the board and a much shorter deadline to sue: no later than 60 days after final completion and acceptance of the public work.
- Highway projects. Indiana Department of Transportation contracts are governed by Indiana Code 8-23-9.
Using the wrong statute can mean using the wrong form or missing the deadline to file suit. If you are unsure which applies, obtain a copy of the prime contract and the payment bond before a payment problem arises. Federal projects in Indiana fall under the federal Miller Act instead. For a side-by-side overview of the federal and state schemes, see the Miller Act vs. the Little Miller Act.
When Is a Payment Bond Required on an Indiana State Project?
When the estimated cost of a State public works project exceeds $200,000, the Division must require the general contractor to furnish a payment bond equal to 100% of the contract price. (IC 4-13.6-7-6(a).) The bond inures directly to the benefit of subcontractors, laborers, suppliers, and those furnishing services in relation to the public work. On projects estimated at $200,000 or less, the director may require a payment bond in any amount up to 100% of the project cost, or may instead have the Division withhold 10% retainage until substantial completion. (IC 4-13.6-7-6(f).)
Practical tip: Ask your customer for a copy of the payment bond before you start work. You will need the surety's name and address if you ever have to make a claim, and it is far easier to obtain at the beginning of the job than after a dispute begins. Our guide Is My Job Bonded? explains how to confirm bond coverage.
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Is a Preliminary Notice Required in Indiana on a State Project?
No. Unlike many states, Indiana does not require a subcontractor or supplier on a State public works project to send a preliminary notice at the start of the job, and no notice deadline runs from your first date of work. Indiana also does not require monthly or periodic notices. (Private residential work in Indiana is different; see Indiana notice requirements.)
The notice that matters comes at the end of your work.
The 60-Day Verified Claim: The Deadline That Matters Most
To preserve your rights, Indiana Code 4-13.6-7-10 requires you to do the following no later than 60 days after you last performed labor or furnished materials or services on the project:
- File a verified (sworn) claim with the Public Works Division.
- Deliver a copy of the claim to the general contractor.
The claim must state the amount due and owing and explain the claim in as much detail as possible. (IC 4-13.6-7-10(a).) To proceed against the payment bond, you must also send a copy of the claim to the surety and inform the Division and the general contractor that the surety has been notified. The Division must supply the information you need to notify the surety. (IC 4-13.6-7-10(b).)
Three points catch claimants off guard:
- The 60 days run from your own last work. The deadline is measured from the last date your company furnished labor, materials or services, not from the end of the project, the date of your invoice or the date payment came due.
- Filing means receipt. Do not assume that mailing the claim on day 60 is enough. Use a delivery method you can prove, and confirm that the Division received the claim. See proof of service: how to send notices so they hold up.
- Notice to the park or agency staff is not enough. The claim must be filed with the Public Works Division.
The Second Remedy: A Claim Against Withheld Contract Funds
The same verified claim also works as a claim against the money the State is withholding from the general contractor. If your claim is undisputed, the Division must pay you from the amounts retained from the general contractor and deduct the payment from the balance due the contractor. If there is not enough money to pay every claimant with an undisputed claim, the funds are prorated. If the claim is disputed, the Division must retain sufficient funds until the dispute is resolved. (IC 4-13.6-7-9.)
There is an important limit. Once the Division makes its final settlement with the general contractor, all claims by subcontractors and suppliers against the withheld funds are barred. (IC 4-13.6-7-8(c).) Final settlement can occur as early as 61 days after substantial completion of the project. (IC 4-13.6-7-8(a).) If your work ends near the end of the job, the money may be gone before your 60 days expire. When a payment problem appears, file early.
Deadline to File Suit on an Indiana Payment Bond
Filing the claim is not the last step. If you remain unpaid:
- You may not sue the surety until 30 days after you filed the claim with the Division and delivered a copy to the general contractor. If the claim is not paid in full by then, you may sue on the bond in your own name. (IC 4-13.6-7-10(c).)
- The Division may not release the contractor's sureties until one year after its final settlement with the general contractor. (IC 4-13.6-7-6(e).) Plan to file suit within that year. Read the bond itself for any suit or notice provision, and do not wait until the end of the year to act.
For the Indiana enforcement timelines on private and local public projects, see Indiana mechanic lien enforcement deadlines.
Indiana State Public Works Bond Claim Deadlines at a Glance
| Requirement | Deadline |
|---|---|
| Preliminary notice | None required |
| Verified claim filed with the Public Works Division | 60 days after your last labor, materials or services |
| Copy of claim to the general contractor | Same 60 days |
| Copy of claim to the surety | With the claim, before proceeding on the bond |
| Claim against withheld funds | Before final settlement with the general contractor |
| Earliest date to sue the surety | 30 days after filing and delivery of the claim |
| Outside date to sue the surety | Within one year after final settlement (sureties may not be released before then); check the bond |
Authorities: IC 4-13.6-7-6, 4-13.6-7-8, 4-13.6-7-9 and 4-13.6-7-10.
Out-of-State Contractors: Check Your Indiana Registration
A company formed outside Indiana that is transacting business in the state may not maintain a lawsuit in Indiana courts until it registers with the Indiana Secretary of State. If you are an out-of-state or Canadian contractor performing installation work in Indiana, confirm your registration before you need to enforce a claim.
Protect Your Payment Rights on Indiana Public Works Projects
Bond claim deadlines on public projects are short, and they differ from state to state and from one type of public owner to another. National Lien & Bond prepares and serves preliminary notices, mechanic's liens and payment bond claims in all 50 states. The National Lien & Bond platform tracks your last date of work on every project and calculates each statutory deadline; create an account, or use our deadline calculator. If you are owed money on an Indiana public works project now, contact us. For an earlier overview, see How to Enforce Miller Act Claims in Indiana.
This article is for general information only and is not legal advice. Deadlines depend on the facts of each project, the governing statute and the terms of the bond. Consult an attorney about your specific situation.
Waiting on money for a job?
Tell us what happened and National Lien & Bond will connect you with an attorney in your state. Free consultation, no obligation.
Frequently Asked Questions
Can I file a mechanic's lien on a State of Indiana project?
No. Public property is not subject to mechanic's liens. Your remedies are the general contractor's payment bond and the claim against the contract funds the State is withholding, both preserved by a verified claim under IC 4-13.6-7-10.
What is the deadline for an Indiana payment bond claim on a State project?
File a verified claim with the Public Works Division and deliver a copy to the general contractor no later than 60 days after you last performed labor or furnished materials or services. To proceed on the bond, also send a copy to the surety and tell the Division and the contractor that the surety was notified. IC 4-13.6-7-10(a), (b).
Do second-tier subcontractors and suppliers have bond rights?
Generally yes. The payment bond inures to the benefit of subcontractors, laborers, suppliers and those furnishing labor, material or service in relation to the public work, and the same 60-day claim procedure applies. IC 4-13.6-7-6(a).
Does the claim have to be sent by certified mail?
The statute does not require certified mail, but you should always use a method that gives you proof of delivery, and confirm the Division received the claim.
When can I sue the surety on an Indiana State public works bond?
Not earlier than 30 days after filing the claim with the Division and delivering a copy to the contractor (IC 4-13.6-7-10(c)). The Division may not release the sureties until one year after final settlement with the contractor (IC 4-13.6-7-6(e)), so plan to sue within that year and check the bond's own terms.
What if I miss the 60-day deadline?
You risk losing your rights against both the payment bond and the withheld funds. Track your last date of work on every public project.
Sources
- 1.IC 4-13.6-7-6 (Payment bonds; $200,000 threshold; release of sureties one year after final settlement).
- 2.IC 4-13.6-7-8 (Final settlement with contractor; claims to withheld funds barred after final settlement).
- 3.IC 4-13.6-7-9 (Payment of undisputed claims; proration; disputed claims).
- 4.IC 4-13.6-7-10 (Verified claim within 60 days; notice to surety; 30-day waiting period before suit).
- 5.IC 36-1-12-13.1 (Local public work payment bonds; duplicate statements; suit within 60 days after final completion and acceptance).
- 6.IC 8-23-9 (Indiana Department of Transportation contracts).
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