New York State Enacts Five Percent Retainage Bill for Private Construction Contracts

December 14, 2023

On November 17, 2023, Governor Kathy Hochul signed into law Senate Bill S3539/A4167 (the “Five Percent Retainage Bill”), which amended certain sections of New York’s General Business Law, limiting the retainage held on construction contracts for private improvements. The Five Percent Retainage Bill aims to reduce the amount of retainage withheld by owners from contractors on private construction projects. This new law goes into effect immediately and applies to contracts entered into on or after November 17, 2023.

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