HB 4418

Abstract

Creates the Government Contract Retainage Act. Defines terms, including that "retainage" means a portion of money withheld from the payment of a contract for a specified period of time to ensure that a contractor or subcontractor finishes a construction project completely and finishes in the manner specified in the contract. Provides that interest shall accrue monthly on the first day of each month on retainage withheld by a governmental unit at a specified rate set by the State Treasurer. Requires retainage withheld by a governmental unit to be paid not more than 60 days after being retained, including interest accrued, unless the retainage was withheld on the last pay period of a project shall, which shall be paid not more than 120 days after being retained. Limits the concurrent exercise of home rule powers. House Committee Amendment No. 3 Replaces everything after the enacting clause. Reinserts the provisions of the introduced bill with the following changes. Removes provisions relating to interest on retainage and payment of retainage. Adds that all governmental units shall deposit all retainage into an interest-bearing escrow account and the moneys in the escrow account and all interest shall be divided up between the contractor and subcontractors proportionally. House Committee Amendment No. 4 Provides that all governmental units shall deposit retainage from contracts with an aggregate value of $300,000 or more (rather than all retainage) into an interest-bearing escrow account.