(1) After settlement, arbitration, or final adjudication of any claim of the department for work done pursuant to a construction contract with any party, the department may offset such amount from payments due for work done on any construction contract, excluding amounts owed to subcontractors, suppliers, and laborers, which it has with the party owing such amount if, upon demand, payment of the amount is not made within 60 days to the department. (2) Offsetting any amounts pursuant to subsection (1) shall not be considered a breach of contract by the department.
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