|Assembly Actions - Lowercase
Senate Actions - UPPERCASE
|Jan 08, 2014||referred to infrastructure and capital investment|
|May 15, 2013||committee discharged and committed to infrastructure and capital investment|
|Jan 09, 2013||referred to consumer protection|
senate Bill S1217
Archive: Last Bill Status - In Senate Committee
- In Committee
- On Floor Calendar
- Passed Senate
- Passed Assembly
- Delivered to Governor
- Signed/Vetoed by Governor
S1217 - Details
S1217 - Summary
Provides for a reasonable amount of construction contract sum to be deposited in a separate interest bearing escrow account with a third party escrow agent; provides further that the owner shall be subject to the payment of interest, in addition to the escrow interest, at the rate of one percent per month and the contractor or subcontractor shall be subject to payment of interest on the amount of retainage it holds at the rate of one percent per month.
S1217 - Sponsor Memo
BILL NUMBER:S1217 TITLE OF BILL: An act to amend the general business law, in relation to retention of construction contracts PURPOSE OR GENERAL IDEA OF BILL: This bill would require retainage held on private construction projects to be placed in an interest-bearing escrow account for the benefit of the parties from whom the retainage is being held. SUMMARY OF SPECIFIC PROVISIONS: This bill accomplishes a much needed construction industry reform. Owners would continue to have added security of holding retain age on progress payments. However, the interest on the held money would be earned for the benefit of the parties, from whom retainage is being held, thus taking some of the sting out of having significant amounts of earned money held for substantial periods of time. JUSTIFICATION: Retainage is the practice of withholding a portion of the earned progress payment of a construction contractor, subcontractor or supplier (hereinafter the "contractor") for work performed, for release at a later time. Retainage is a long-standing tradition in the building industry, and unique to the construction process, as it
S1217 - Bill Text download pdf
S T A T E O F N E W Y O R K ________________________________________________________________________ S. 1217 A. 529 2013-2014 Regular Sessions S E N A T E - A S S E M B L Y (PREFILED) January 9, 2013 ___________ IN SENATE -- Introduced by Sen. DeFRANCISCO -- read twice and ordered printed, and when printed to be committed to the Committee on Consumer Protection IN ASSEMBLY -- Introduced by M. of A. CUSICK, HOOPER, ROBINSON -- read once and referred to the Committee on Economic Development AN ACT to amend the general business law, in relation to retention of construction contracts THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Section 756-c of the general business law, as added by chapter 127 of the laws of 2002, is amended to read as follows: S 756-c. Retention. By mutual agreement of the relevant parties an owner may retain a reasonable amount of the contract sum as retainage[. A] AND FOR ANY CONSTRUCTION CONTRACTS, EXCLUDING CONSTRUCTION CONTRACTS FINANCED BY A PUBLIC BENEFIT CORPORATION, SUCH RETAINAGE SHALL BE DEPOS- ITED IN A SEPARATE INTEREST BEARING ESCROW ACCOUNT WITH A THIRD PARTY ESCROW AGENT. AS OF THE TIME OF THE DEPOSIT OF THE RETAINAGE, THE RETAINED FUNDS SHALL BECOME THE SOLE AND SEPARATE PROPERTY OF THE CONTRACTOR. INTEREST ON THE RETAINED FUNDS SHALL ACCRUE AT AN INTEREST RATE AT LEAST EQUAL TO THE PREVAILING INTEREST RATE PAID ON DEPOSITS BY THE ESCROW AGENT. ALSO, A contractor or subcontractor may [also] retain a reasonable amount for retainage so long as the amount does not exceed the actual percentage [retained] DEPOSITED IN ESCROW by the owner. [Retainage] THE ESCROWED RETAINAGE shall be released by the [owner] OWNER'S WRITTEN DIRECTION TO THE ESCROW AGENT TO DELIVER THE ESCROWED RETAINAGE 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 THE ESCROWED retainage as required by this arti- cle, or the contractor or subcontractor fails to release a proportionate EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted.
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