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AB-2186 Public contracting: contractor retention withholding.(2019-2020)

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Date Published: 02/11/2020 09:00 PM
AB2186:v99#DOCUMENT


CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Assembly Bill
No. 2186

Introduced by Assembly Member Grayson

February 11, 2020

An act to amend Section 9203 of the Public Contract Code, relating to public contracting.


LEGISLATIVE COUNSEL'S DIGEST


AB 2186, as introduced, Grayson. Public contracting: contractor retention withholding.
Existing law authorizes the legislative body of a local agency, as defined, to prescribe how the local agency makes payment on a contract with the local agency for the creation, construction, alteration, repair, or improvement of any public structure, building, road, or other improvement of any kind that will exceed a total of $5,000. Existing law limits this authority by requiring progress payments on the contract to not be made in excess of 95% of the percentage of actual work completed plus a like percentage of the value of material delivered on the ground or stored subject to, or under the control of, the local agency, and unused. Existing law also requires the local agency to not withhold less than 5% of the contract price until final completion and acceptance of the project, unless, at any time after 50% of the work has been completed, the local agency finds that satisfactory progress is being made.
This bill would eliminate the above described limitations on a local agency’s authority to prescribe payments on these contracts. The bill would, however, prohibit the local agency from withholding more than 5% of the contract price for contracts for the creation, construction, alteration, repair, or improvement of any public structure, building, road, or other improvement of any kind that will exceed $5,000 in total costs.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: NO   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Section 9203 of the Public Contract Code is amended to read:

9203.
 (a) Payment on any contract with a local agency for the creation, construction, alteration, repair, or improvement of any public structure, building, road, or other improvement, improvement of any kind which that will exceed in cost a total of five thousand dollars ($5,000), shall be made as the legislative body prescribes upon estimates approved by the legislative body, but progress payments shall not be made in excess of 95 percent of the percentage of actual work completed plus a like percentage of the value of material delivered on the ground or stored subject to, or under the control of, the local agency, and unused. The body. However, the local agency shall not withhold not less more than 5 percent of the contract price until final completion and acceptance of the project. However, at any time after 50 percent of the work has been completed, if the legislative body finds that satisfactory progress is being made, it may make any of the remaining progress payments in full for actual work completed. price.
(b) Notwithstanding the dollar limit specified in subdivision (a), a county water authority shall be subject to a twenty-five thousand dollar ($25,000) limit for purposes of subdivision (a).