Notwithstanding AS 36.90.210 and 36.90.230, the prime contractor or a subcontractor may negotiate and include in a public construction or public works subcontract a provision that permits (1) the prime contractor or a subcontractor to determine that part or all of a subcontractor's request for payment may be withheld for unsatisfactory performance under the subcontract; and (2) the prime contractor or a subcontractor to withhold payment for unsatisfactory performance without incurring an obligation to pay interest for late payment, if a notice complying with AS 36.90.240 has been previously furnished to the subcontractor and a copy of the notice is furnished to the contracting officer of the state or political subdivision.
Alaska Legal Code