State Finance and Procurement - Retention Proceeds

HB 1166 requires state agencies and contractors to pay undisputed retention proceeds within 90 days of a project's substantial completion. It limits retainage (the portion of payment held back) to 5% of the total contract value for construction projects when contractors provide full payment and performance security. The bill also mandates that withheld funds be placed in an interest-bearing escrow account and prevents contractors from retaining more than the state does from subcontractors. This applies to all Maryland state construction procurement contracts.