Prompt Payment Ordinance

Summary

Contractor Prompt Payment Ordinance. This Ordinance provides that a retainage of 10% of the payment may be withheld from a payment under a construction contract prior to the completion of 50% of the contract. Provides that after 50% of the contract is completed, the amount of retainage for any subsequent payment may not exceed 5%. Effective immediately.

Prompt Payment Ordinance

AN ordinance concerning business.
Be it enacted by the [Insert Governing Body],represented in the [Insert Jurisdiction]:
Section 1. The Contractor Prompt Payment Ordinance as follows:
A construction contract may provide for the withholding of retainage of up to 10% of any payment made prior to the completion of 50% of the contract. When a contract is 50% complete, retainage withheld shall be reduced so that no more than 5% is held. After the contract is 50% complete, no more than 5% of the amount of any subsequent payments made under the contract may be held as retainage.

[Insert Effective date]