Senate Bill S3539

Signed By Governor
2023-2024 Legislative Session

Relates to payment and retainage in construction contracts

download bill text pdf

Sponsored By

Current Bill Status - Signed by Governor

  • Introduced
    • In Committee Assembly
    • In Committee Senate
    • On Floor Calendar Assembly
    • On Floor Calendar Senate
    • Passed Assembly
    • Passed Senate
  • Delivered to Governor
  • Signed By Governor

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2023-S3539 (ACTIVE) - Details

See Assembly Version of this Bill:
A4167
Law Section:
General Business Law
Laws Affected:
Amd §§756-a & 756-c, Gen Bus L
Versions Introduced in Other Legislative Sessions:
2015-2016: A10446
2017-2018: S8848, A9637
2019-2020: S981, A3558
2021-2022: S5482, A6985

2023-S3539 (ACTIVE) - Summary

Relates to payment and retainage in construction contracts; authorizes contractors to invoice owners upon substantial completion of a project.

2023-S3539 (ACTIVE) - Sponsor Memo

2023-S3539 (ACTIVE) - Bill Text download pdf 

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   3539
 
                        2023-2024 Regular Sessions
 
                             I N  S E N A T E
 
                             January 31, 2023
                                ___________
 
 Introduced  by  Sen. BRESLIN -- read twice and ordered printed, and when
   printed to be committed to the Committee on Consumer Protection
 
 AN ACT to amend the general business law, in  relation  to  payment  and
   retainage in construction contracts
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. The opening paragraph of paragraph (a) of subdivision 2  of
 section  756-a of the general business law, as amended by chapter 417 of
 the laws of 2009, is amended to read as follows:
   A contractor shall be  entitled  to  invoice  the  owner  for  interim
 payments at the end of the billing cycle. A contractor shall be entitled
 to  submit  a final invoice for payment in full [upon the performance of
 all the  contractor's  obligation  under  the  contract]  UPON  REACHING
 SUBSTANTIAL COMPLETION, AS SUCH TERM IS DEFINED IN THE CONTRACT OR AS IT
 IS CONTEMPLATED BY THE TERMS OF THE CONTRACT.
   §  2.  Section  756-c of the general business law, as added by chapter
 127 of the laws of 2002, is amended to read as follows:
   § 756-c. Retention. By mutual agreement of  the  relevant  parties  an
 owner  may  retain [a reasonable amount] NO MORE THAN FIVE PER CENTUM of
 the contract sum as retainage. A contractor or  subcontractor  may  also
 retain  [a reasonable amount] NO MORE THAN FIVE PER CENTUM for retainage
 [so long as the amount does not] AND IN NO CASE SHALL  RETAINAGE  exceed
 the actual percentage retained by the owner. Retainage shall be released
 by the owner to the contractor no later than thirty days after the final
 approval of the work under a construction contract. In the event that an
 owner  fails  to  release  retainage as required by this article, or the
 contractor or subcontractor fails to release a proportionate  amount  of
 retainage  to  the  relevant parties after receipt of retainage from the
 owner, the owner, contractor, or subcontractor,  as  the  case  may  be,
 shall  be  subject to the payment of interest at the rate of one percent
 per month on the date retention was due and owing.
   § 3. This act  shall  take  effect  immediately  and  shall  apply  to
 contracts entered into on or after such effective date.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets

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