Governor Signs Bill Limiting Amount Which May Be Withheld For Retainage On Private Construction Contracts
On November 17, 2023, Governor Hochul signed a bill which, among other things, limits the amount of retainage which may be withheld on private construction contracts which equal or exceed $150,000 to no more than five percent. This bill amends Sections 756-a and 756-c of the New York State General Business Law which address prompt payment of contractor claims. The bill also permits contractors to submit a final invoice for payment in full upon reaching substantial completion instead of final completion. In the event that the owner fails to release the retainage as required by the bill, the contractor shall be entitled to recover “interest at the rate of one percent per month on the date retention was due and owing.”
When entering into construction contracts, it is important to understand the impact of this new law. Jaspan Schlesinger Narendran LLP can help you in negotiating construction contracts. If you need assistance, please contact Christopher E. Vatter at firstname.lastname@example.org or Laurel R. Kretzing at email@example.com.
Christopher E. Vatter is a partner in Jaspan Schlesinger Narendran LLP’s Municipal and Litigation Practice Groups, where he represents both private and municipal clients. Mr. Vatter focuses his practice in the areas of complex commercial litigation, municipal law, personal injury defense, construction law and banking litigation.
Laurel R. Kretzing is a partner in Jaspan Schlesinger Narendran LLP’s Municipal and Litigation Practice Groups, where she represents both private and municipal clients in a broad range of matters including personal injury defense, litigated real estate matters, construction matters and civil rights and municipal litigation.
 The material in this blog is meant only to provide general information and is not a substitute nor is it legal advice to you.