Public contracts: retention: architecture or engineering services.
Vote required
Majority
Fiscal committee
No
Appropriation
No
Current location
Passed
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Progress
Where this bill stands in the legislative process.
- Introduced
- Passed Senate
- Passed Assembly
- To Governor
- Became Law
Overview
This bill changes the rules for how much money public entities can hold back (retain) from payments to architecture and engineering firms. Starting January 1, 2027, public entities can only retain a maximum of 5% of the payment for contracts with these firms, and the retained funds must be released within 60 days of the firm completing their services. The bill also clarifies definitions related to public entities and firms.
Key provisions
- Limits retention payments from architecture and engineering firms to 5% of the payment.
- Requires retention payments to be released within 60 days of service completion.
- Applies to contracts entered into on or after January 1, 2027.
- Defines ‘firm’ as an individual, firm, or legal entity licensed to practice architecture or engineering.
- Defines ‘public entity’ broadly, including state agencies, universities, and local governments.
- Applies to contracts under design-bid-build.
- Covers amendments to existing contracts.
- Prohibits retention of payment retention payments.
Who is affected
- Public entities (state, cities, counties, etc.)
- Architecture and engineering firms
- Contractors working with public entities
- Subcontractors working with architects and engineers
- Local governments
Notable changes
Bill text
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Sponsors
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1 on record
Primary sponsor
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