Which States Pay Contractors Late? What Their Own Books Show

Virginia paid $6,014,182 in late-payment interest in FY2025, per its Department of Accounts [1]. That nearly doubles FY2024's $3,045,288 [2].

Which States Publish How Late They Pay Contractors?

New York, Virginia and Minnesota publish statewide prompt payment reports, per our 2026 search. Illinois posts a running interest total. Florida and Texas show up only through auditors.

That's the whole list. Most states pass a prompt payment law and then stop counting.

Self-reported means the paying state counted its own lateness. Independent means an inspector general or statewide auditor did the checking. Keep that split in mind.

How Much Prompt Payment Interest Does New York Pay Contractors?

New York agencies paid $4,239,678 in prompt payment interest in SFY 2025-26 [3]. That covered 25,200 late interest payments.

The number has barely moved in three years. It jumped fourfold after SFY 2021-22, then stayed there.

Five agencies drive most of it. Health alone paid 28.6% of the SFY 2025-26 total.

The cause is paperwork, mostly. In SFY 2023-24, "delay in encumbrance processing" drove $1,570,059 of interest across 730 payments [4].

Encumbrance is the step where an agency reserves the money for a contract. If that step stalls, the vendor waits.

The Comptroller says its own speed prevented an estimated $1,212,747 in extra interest [3]. That is the Comptroller grading its own homework.

Why Did Virginia's Late-Payment Interest Double in One Year?

Virginia's prompt payment interest rose from $3,045,288 in FY2024 to $6,014,182 in FY2025 [1][2]. Late payments actually fell.

Virginia counted 82,873 late payments in FY2024 and 66,352 in FY2025. Fewer late checks, twice the interest.

The FY2025 report explains the gap on its own. Late payments are a small share by count but a larger share by dollars.

So the invoices that sit are the big ones. For a contractor carrying payroll on a large state job, that is the worst pattern.

A $50,000 progress billing stuck for weeks hurts more than a hundred small late checks. It also stretches your DSO right when payroll hits.

Agency spread matters too. General Services hit only 73.0% compliance. It paid 5,393 of 19,960 payments late [1].

Why Does Minnesota Pay So Little Late Interest?

Minnesota agencies paid $34,486.24 in late-payment interest in FY2025, per Minnesota Management and Budget [6]. Virginia paid 174 times more.

Part of that is performance. Minnesota paid 98.11% of payments within 30 days, above its 98% goal [6].

The other part is statute design. Under Minnesota law, the vendor must invoice the agency for interest first [13].

We can't prove the billing rule causes the low total. But a rule that needs a vendor invoice will always undercount what vendors were owed.

Minnesota's own interest also quadrupled, from $8,379.33 in FY2024 [7]. Small base, same direction as Virginia.

What Do Auditors Find When They Check State Payment Timeliness?

Independent reviewers find late payment where states rarely report it. Florida and Texas numbers come only from audit work.

The Texas finding is the one to remember. Agencies paid $41.4 million without calculating interest at all [11].

That was card spending. Still, owed interest vanishes the moment someone switches the calculation off.

GAO found the same blind spot federally. DOD's late-penalty metric left out about $54 billion of covered payments in FY2011 [12].

Illinois is the extreme case. The state paid over $665 million in Vendor Payment Program interest, per its Comptroller [9].

That happened when the unpaid bill backlog peaked at $16.7 billion. Its current page lists $3,285,697.36 in late-payment interest for an unlabeled prior year [8].

What Interest Rate Does Each State Owe on a Late Invoice?

Each state sets its own late-payment rate by statute. New York currently pays 6%. Minnesota pays 18% a year. The deadlines differ just as much.

Illinois gives agencies 90 days before interest starts. New York gives 30. That gap is two months of your working capital.

What Isn't Measured Anywhere?

No source we found answers the biggest question: how late the average state pays nationwide. Here is what's missing.

We also tried Massachusetts, North Carolina, Pennsylvania, New Jersey and Washington. We found no statewide prompt payment report to cite.

How Can You Get Your Own State's Late-Payment Numbers?

Any state that pays interest has to record it. That makes the numbers requestable.

Send a short written request to the state comptroller or finance department. Ask for prompt payment interest paid by agency, by fiscal year.

Also ask for late-payment counts and any internal compliance report the agency prepares for managers. Most agencies list a records officer.

Fees and response times vary by state. This is general information, not legal advice.

Methodology: How We Built This Dataset

We collected 51 data points from 26 source documents published between 2012 and 2026. Every figure traces to a page we opened.

Our research date was September 24, 2026. The count-to-dollar gap is our own calculation from Virginia's published totals.

We excluded blog claims about average state payment times. None held up.

Last updated: September 24, 2026. We re-check these reports quarterly.

Frequently Asked Questions