Oregon and Washington now allow contractors and subcontractors to avoid cash retainage by posting a surety bond with the owner, on both public and private/commercial construction projects. The process is similar in both...more
Construction contracts for private projects will soon be subject to a new retainage law in Mississippi. On April 19, 2024, Gov. Tate Reeves approved SB 2762 into law, and after July 1, 2024, most construction contracts on...more
On November 17, 2023, Governor Kathy Hochul signed Senate Bill 3539, amending Section 756-a and Section 756-c of the New York General Business Law (more commonly referred to as the Prompt Payment Act) to set the maximum...more
New York has made changes to its Prompt Payment Act (N.Y. Gen. Bus. Law §756) Legislation, which Gov. Kathy Hochul signed into law on November 17, 2023, provides that: • retainage on private construction projects is capped...more
On November 17, 2023, Governor Hochul signed a bill placing significant restrictions on the amount of retainage that can be withheld from contractors and subcontractors, and permitting the earlier submission of final billing...more
A newly-enacted amendment to the New York General Business Law is designed to reduce delays in final payments to contractors, limit the amount of the contract sum (“retainage”) that can be withheld by and revises the...more
No matter your tier in the construction contracting chain, understanding the nuanced rules and procedures about retainage, back charges, and other payment withholdings is critical to managing cash flow and protecting your...more
On May 9, 2023, Washington Governor Jay Inslee signed into law Senate Bill (SB) 5528, which limits the percentage of retainage withheld from contractors on private construction projects in Washington....more
New private project retention cap matches that for public construction projects and takes effect July 23 - This year, the Washington State Legislature approved a cap on retainage for private projects. The stated purpose of...more
Depending on the state, retainage often provides an owner a security interest in unpaid funds to help cover completion costs or other damages that may later occur by withholding a certain portion (typically 5-10%) of contract...more
Here’s the Scenario: Try explaining the concept of “retainage” to a businessperson unfamiliar with the construction industry at your next holiday party. Here’s the typical response as she spits out her eggnog: “Wait a minute:...more
Legislation about retainage has become common place as many states have adopted different limitations, requirements, and schemes. A recent case in Tennessee is a good reminder that you must pay attention to all of the...more
On June 30, the Supreme Court of Tennessee issued an opinion interpreting the retainage provisions in Tennessee’s Prompt Pay Act (the Act). The opinion has significant implications for construction projects across Tennessee....more
After a number of controversial bills proposed from various industry groups over the last few years, the Tennessee construction community came together in 2020 to push through legislation intended to protect members of the...more
This Construction Law Alert highlights some of the significant Tennessee state and federal decisions affecting the construction industry from the past year. Holdback Payments Are Not Retainage - Tennessee’s Prompt Pay...more
Connelly Constr. Corp. v. Travelers Cas. & Surety Co. of Am., 2018 U.S. Dist. LEXIS 123009 (E.D. Pa. July 24, 2018). The Commonwealth of Pennsylvania Department of General Services undertook a project for the construction...more
The Illinois legislature recently passed a bill that may impact retainage on your projects. The bill—if passed into law—sets the ceiling for retainage at 10%, and requires that retainage be reduced to 5% once the project is...more
Illinois is the most recent in a number of states to consider legislation that modifies the practice of withholding payments from contractors and subcontractors as retainage. ...more
The Louisiana Fourth Circuit's recent decision in Woodrow Wilson Constr. LLC v. Orleans Parish School Board marks a potential victory for general contractors seeking final payment on public construction projects. However, it...more
Illinois is considering joining the growing ranks of states that restrict retainage withheld on private or public construction projects. Illinois Senate Bill 3052, invalidating contract clauses calling for retainage in...more
The Commonwealth of Massachusetts has a new retainage law applicable to most private construction projects that took effect on Nov. 6, 2014. The Retainage Law limits retainage to 5 percent of each payment and regulates the...more
In This Issue: - Retainage limited to 5 percent in Massachusetts: Outlier or coming to your state? - Pennsylvania overhauls mechanic’s lien law with creation of state construction notices directory -...more
A new law is now in effect for contracts executed after November 6, 2014, that not only affects the amount of retainage that a construction stakeholder may withhold but also mandates processes for project completion. In...more