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§ 17-110. Retainage requirements

West's Annotated Code of MarylandState Finance and ProcurementEffective: July 1, 2013

West's Annotated Code of Maryland
State Finance and Procurement
Division II. General Procurement Law [Titles 11-End] (Refs & Annos)
Title 17. Special Provisions--State and Local Subdivisions (Refs & Annos)
Subtitle 1. Security for Construction Contracts (Refs & Annos)
Effective: July 1, 2013
MD Code, State Finance and Procurement, § 17-110
§ 17-110. Retainage requirements
Currentness
Entities complying with § 13-225
(a) Subsections (b)(1) and (2), (c), and (d) of this section do not apply to an entity that is required to comply with the provisions of § 13-225 of this article.
In general
(b)(1) If a contractor has furnished 100% payment security and 100% performance security in accordance with this subtitle under a contract for construction awarded by a public body, the percentage specified in the contract for retainage may not exceed 5% of the total amount of the contract.
(2) In addition to retainage, a public body may withhold from payments otherwise due a contractor any amount that the public body reasonably believes necessary to protect the public body's interest.
(3) Except as provided in paragraph (4) of this subsection, within 120 days after satisfactory completion of a contract for construction, a public body shall release any retainage due to the contractor.
(4) If there is a dispute or contract claim between the contractor and the public body concerning the satisfactory completion of a contract for construction, the public body shall release the retainage to the contractor within 120 days after the resolution of the dispute or contract claim.
Subcontractors
(c)(1) A contractor may not retain a percentage of payments due a subcontractor that exceeds the percentage of payments retained by the public body.
(2) Paragraph (1) of this subsection may not be construed to prohibit a contractor from withholding any amount in addition to retainage if the contractor determines that a subcontractor's performance under the subcontract provides reasonable grounds for withholding the additional amount.
Lower tier subcontractors
(d)(1) A subcontractor may not retain a percentage of payments due a lower tier subcontractor that exceeds the percentage of payments retained from the subcontractor.
(2) Paragraph (1) of this subsection may not be construed to prohibit a subcontractor from withholding any amount in addition to retainage if the subcontractor determines that a lower tier subcontractor's performance under the subcontract provides reasonable grounds for withholding the additional amount.
Construction with Subtitle
(e) This section may not be construed to limit the application of the remaining provisions of this subtitle.

Credits

Added by Acts 2003, c. 292, § 2, eff. Oct. 1, 2003. Amended by Acts 2004, c. 173, § 1, eff. Oct. 1, 2004; Acts 2013, c. 23, § 1, eff. July 1, 2013.
MD Code, State Finance and Procurement, § 17-110, MD STATE FIN & PROC § 17-110
Current through legislation effective through April 9, 2023, from the 2024 Regular Session of the General Assembly. Some statute sections may be more current, see credits for details.
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