Bill > SB165

This bill allows contractors and subcontractors working on construction projects to use a "retainage bond" as an alternative to having a portion of their payment withheld as security, a practice known as retainage. A retainage bond is essentially a guarantee from an insurance company, in the amount of the withheld retainage, that ensures the owner or general contractor will be paid if the contractor or subcontractor defaults. If a contractor or subcontractor provides this bond, they can either receive the withheld retainage payment immediately or avoid having retainage withheld from future payments, as long as they are not in breach of their contract. This provision applies to contracts between owners and general contractors, as well as between general contractors and subcontractors, and it also clarifies that the contractor or subcontractor providing the bond is entitled to any interest earned on that bond. The bill also includes a provision that it will not take effect unless reenacted by the General Assembly in 2027.

Government Affairs, Justice

https://lis.virginia.gov/bill-details/20261/SB165