California Public Contract Code 10198.6 – (a) If the department elects to award a project pursuant to this …
(a) If the department elects to award a project pursuant to this article, retention proceeds withheld by the department from the design-build entity shall not exceed 5 percent if a performance and payment bond, issued by an admitted surety insurer, is required in the solicitation. Work performed to establish the guaranteed maximum price shall not be subject to retention.
(b) In a contract between the design-build entity and a subcontractor, and in a contract between a subcontractor and any subcontractor thereunder, the percentage of the retention proceeds withheld shall not exceed the percentage specified in the contract between the department and the design-build entity. If the design-build entity provides written notice to any subcontractor that is not a member of the design-build entity, before or at the time the bid is requested, that a bond may be required, and the subcontractor subsequently is unable or refuses to furnish a bond to the design-build entity, then the design-build entity may withhold retention proceeds in excess of the percentage specified in the contract between the department and the design-build entity from any payment made by the design-build entity to the subcontractor.
Terms Used In California Public Contract Code 10198.6
- Contract: A legal written agreement that becomes binding when signed.
- project: includes the erection, construction, alteration, repair, or improvement of any state structure, building, road, or other state improvement of any kind that will exceed a total cost calculated pursuant to subdivision (b). See California Public Contract Code 10105
(Added by Stats. 2021, Ch. 77, Sec. 26. (AB 137) Effective July 16, 2021.)