Retainage release

Definition

The state rule capping what may be held back and dating when it comes back.

Why It Matters

The retainer is the money and this is the law that makes its clock real, where there is one. New York's private rule caps retainage at five per cent, requires release within thirty days of final approval of the work, and charges one per cent a month on money held past that, which turns it into an enforceable receivable. Public work is a different animal. The cap can reach ten per cent where the owner requires no performance and payment bonds. In place of a payment deadline the owner pays the balance less twice the value of the remaining items, so a forty thousand dollar punch list holds eighty. Read the scope before relying on any of it. The private statute reaches projects at or above one hundred fifty thousand dollars and excludes small residential work, so a remodeler can sit outside it with no cap, no clock and no interest.