California legislation · 2025-2026 Regular Session
California SB1205: Public contracts: retention: architecture or engineering services.
Status: Chaptered, September 20, 2026
What the bill says
An act to add Section 7204 to the Public Contract Code, relating to public contracts. public contracts Public contracts: retention: architecture or engineering services. Existing law imposes various requirements regarding the formation, content, and enforcement of public works contracts. Existing law generally requires that retention proceeds withheld from payment by a public entity be released within 60 days after the date of completion of the work of improvement, except as specified in case of a dispute…
From the chaptered text, September 20, 2026:
An act to add Section 7204 to the Public Contract Code, relating to public contracts. public contracts Public contracts: retention: architecture or engineering services. Existing law imposes various requirements regarding the formation, content, and enforcement of public works contracts. Existing law generally requires that retention proceeds withheld from payment by a public entity be released within 60 days after the date of completion of the work of improvement, except as specified in case of a dispute. Existing law limits the allowable amount of retention proceeds withheld in a contract between a public entity and the original contractor, a contract between the original contractor and a subcontractor, and a contract between subcontractors, as specified. Existing law defines “public entity” differently for these various purposes. This bill would prohibit any retention payments from exceeding 5% of the payment for contracts under design-bid-build, and amendments thereto, entered into on or after January 1, 2027, directly between a public entity and an individual or legal entity permitted by law to practice the profession of architecture or engineering, except for specific projects where, among other things, a finding has been made that the project is substantially complex and requires a higher retention amount. The bill would require any retention withheld to be released no later than 60 days after completion of services under contract. The …