Government Contracts Monitor

Short Take: Treasury Increases Prompt Payment & Contract Disputes Interest Rates

January 12, 2015

The Treasury Department has announced that the Prompt Payment Act interest rate is being increased to 2.125% per annum for the period of January 1, 2015 through June 30, 2015. 79 Fed. Reg. 78950 (Dec. 31, 2014). This interest rate is used to calculate the penalty paid by the Government when it fails to timely pay contractors for goods and services as well as interest due under the Contract Disputes Act. The prior interest rate was set at 2.00%. For an updated list of the established interest rates for all periods since January 1, 1980, see http://www.fms.treas.gov/prompt/rates.html.

Hopewell Darneille is the attorney responsible for the content of this article.