Texas Retainage Guide and FAQs

Ready? Build your demand for retainage now

Make Your Retainage Demand Now
Texas Retainage FAQs

Texas Retainage Requirements


Retainage 10% Icon
10% Retainage Limit

For work in which a mechanic’s lien may be claimed, the property owner must retain 10%.


Payment Period 30 Days Icon
30 Day Pay Period

The time period to withhold retainage is very complicated and not well defined in Texas law. It appears that 30 days after work is completed retainage must be released.


YES
PROCESS
There is a Process to Recover

Yes, specific notices and timing requirements apply to the recovery of retainage in Texas.


No Escrow Icon
Not Held In Escrow

In Texas, contractors and owners do not need to hold retainage funds in a separate escrow account.

Retainage icon
5% or 10% Retainage Limit

On projects valued at less than $5M, no more than 10% may be withheld as retainage. On projects valued at $5M or more, no more than 5% of retainage may be withheld.


Payment Period Icon
Pay Period

The statute is unclear, but retainage may not be withheld after the project reaches substantial completion.


YES
PROCESS
There is a Process to Recover

Yes, specific notices and timing requirements apply to the recovery of retainage in texas.

Retainage, also called “retention,” is an amount of money “held back” from a contractor or subcontractor during the course of a construction project. In general, retainage serves two main purposes:

  • To provide an incentive to the contractor or subcontractor to complete the project; &
  • To give the owner some protection against problems like liens, contractual defaults, delays, and more.

In most states, laws exist to regulate how the parties use the retainage concept, mostly protecting some parties against abuse of the tool from others. The following are resources, legal information, and answers to frequently asked questions about Texas’ retainage requirements.

Texas’ retainage limits and deadlines

For private projects, the amount of retainage that may be withheld is no more than 10% of the total contract price, or reasonable value of the labor and/or materials if there is no contract price.

In order to make a claim for a lien on retainage, the claimant must send a Notice of Contractual Retainage no later than 30 days after the claimant’s contract is completed, terminated, or abandoned, or 30 days after the original contract is terminated or abandoned; whichever is earlier.

The deadline to file a claim on retainage can be tricky. Generally, the lien must be filed no later than 30 days after project completion, or after the original contract is terminated or abandoned; whichever is earlier. However, the claim must also be filed no later than the earliest of:

(i) the 15th day of the 4th month after the claimant’s last furnishing of labor or materials (3rd month if the project was residential – yes, retainage requirements apply to residential projects, too)

(ii) the 40th day after the completion date stated in an affidavit of completion provided the owner sent the claimant notice of an affidavit of completion in the time and manner required;

(iii) the 40th day after the date of termination or abandonment of the original contract, if the owner sent the claimant a notice of such termination or abandonment in the time and manner required; or

(iv) the 30th day after the date the owner provided the claimant with a written demand (meeting the statutory requirements) for the claimant to file the affidavit claiming a lien.

Note: changes will go into effect for all original contracts entered into on or after 1/1/22, the details of these changes can be found in the FAQs section below.

For public projects, the amount of retainage that may be withheld depends on the overall project value. For contracts valued at less than $5M, no more than 10% may be withheld as retainage. On projects valued at $5M or more, the amount of allowable retainage is only 5% of the total contract price.

To make a claim for retainage on public projects, the claimant must send a Notice of Contractual Retainage no later than 90 days after the completion of the project. As for the deadline to enforce the claim, claimants should follow the payment bond enforcement deadline, which it more than 60 days after sending the notice, but no later than one year after the notice was served.

Texas Retainage Frequently Asked Questions

Texas Retainage Private Projects FAQs

What types of private projects are subject to Texas’ retainage laws?

The Texas private retainage laws apply to all private construction projects in which a mechanics lien may be claimed.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

Does Texas limit the amount of retainage that can be withheld from a contractor?

Yes, on private construction projects in Texas, no more than 10% of the total contract price (or reasonable value of the work if there is no contract price) may be withheld as retainage.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

Does Texas require retained funds to be deposited in a special account? Can securities be substituted?

There is no specific requirement to have the retained funds to be deposited in any special, interest-bearing account (such as an escrow account), nor any specific ability to substitute securities in lieu of retainage. These will be governed by the terms of the contract between the parties.

• Learn more: Retention Bonds- An Alternative to Waiting for Retainage

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

How long can a party withhold retainage in Texas?

The time period to withhold retainage is very complicated and not well defined in Texas law. It appears that 30 days after work is completed retainage must be released.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

Is there a specific notice required to recover retainage in Texas?

CURRENT RULES

Yes, claimants must provide a Notice of Contractual Retainage to the property owner (and the GC if hired by a subcontractor) no later than the earlier of the 30th day after:

• Claimant’s contract is completed, terminated, or abandoned; or

• Original contract is terminated or abandoned.

The notice must include the name and address of the claimant, the name and address of the subcontractor (if hired by a sub), and state the existence of a requirement for retainage.

Download a free Notice of Contractual Retainage form here

2022 CHANGES

The same general deadlines apply, however, for all original contracts entered into after 1/1/22, the notice is renamed a “Notice of Claim for Unpaid Retainage.” Additionally, the notice must be in the statutory form provided under Tex. Prop. Code §53.057, and include the following information:

• Date;

• Project address;

• Claimant’s name, contact person, & address;

• Description of labor and/or materials;

• Original contractor’s name;

• Party with whom the claimant contracted with (if different from original contractor); &

• Total amount of retainage unpaid.

Download a free Notice of Claim for Unpaid Retainage form (2022) here

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

How can I make a claim to recover retainage in Texas?

CURRENT RULES

The deadline to file an affidavit of lien on retainage in Texas is a bit confusing.

The lien on retainage must be filed no later than the 30th day after the earlier of the date:

• the work is completed; or

• the original contract is terminated or abandoned.

OR

The lien on retainage must be filed, no later than the earliest of:

• the typical lien filing date as set out under §53.052;

• the 4oth date after the date listed on an Affidavit of Completion, if the owner gave timely notice;

• the 40th day after the date of termination or abandonment of the original contract; if the owner gave timely notice when required; or

• the 30th day after the date the owner sent a written demand to file an affidavit of lien.

2022 CHANGES

For all original contracts entered into on or after 1/1/22, the deadline for retainage liens was simplified in some aspects, but made more confusing in others. The deadline can no longer be cut short, but there is a contradiction under the new laws.

Under §53.052(d), a lien for retainage must be filed no later than the 15th day of the 3rd month after the month the original contract was completed, terminated, or abandoned.

However, §53.103 remains; which provides the retainage lien deadline of no later than 30 days after the work is complete, or the original contract is terminated or abandoned.

The best practice is to err on the side of caution and follow the 30-day deadline. However, if missed, the claimant may still be able to file a lien under the 15th day of the 3rd-month deadline.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

Texas Retainage Public Projects FAQs

What types of public projects are subject to Texas’ retainage laws?

The Texas public retainage laws apply to all projects involving the construction, alteration, or repair of a public building or public work valued at $400K or more,

However, these rules do not apply to public works contracts made by the Texas Department of Transportation under Chapter 223 of the Transportation Code, projects receiving financial assistance under the Texas Water Code, or wholesale water suppliers to customers in 10 or more counties governed by Chapter 49 of the Texas Water Code.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

Does Texas limit the amount of retainage that can be withheld from a contractor?

Yes, the maximum amount of retainage that can be withheld depends on the contract value and type of project.

• On public works contracts valued at less than $5M or projects related to the construction or maintenance of a dam (regardless of the contract value), the amount of retainage withheld can be no more than 10% of the total contract price.

• On public works contracts valued at $5M or more, the amount of retainage that can be withheld is capped at no more than 5% of the contract price.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

How long can a party withhold retainage in Texas?

The statutes aren’t particularly clear, but the public entity may not withhold retainage after the project reaches substantial completion, which is required to be defined in the contract. This includes the warranty period, which is also required to be defined in the contract.

Also, the entity may choose to either release retainage when the project is fully completed, or release retainage upon substantial completion of portions of the work.

• Note: entities are permitted to continue to withhold retainage upon written notice to the prime contractor if (i) there is a bona fide dispute with the prime contractor over labor, services, or materials either provided by the prime contractor or under the prime contractor’s direction or control that failed to comply with the public works contract; or (ii) a surety for a bond executed for the contract does not agree to release retainage.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

Does Texas require retained funds to be deposited in a special account? Can securities be substituted?

Generally, there is no requirement to have the withheld retainage funds to be deposited in any special account. However, on competitively awarded contracts valued at $10M or more, the public entity and the original contractor may agree to require the withheld funds to be placed in an interest-bearing account, the interest of which shall be paid to the contractor upon completion.

Furthermore, the law is silent on the ability to substitute securities in lieu of retainage. Presumably, this will be governed by the terms of the contract between the parties.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

Is there a specific notice required to recover retainage in Texas?

Yes, in order to make a claim against the payment bond for the payment of retainage. Claimants must serve a written notice of the claim on the prime contractor and the surety no later than 90 days after the completion of the project by registered, or certified mail return receipt requested,

The notice should include the amount of the contract, the amount paid, and the outstanding balance.

• Note: this notice is not necessary if the amount of retainage withheld is included in a prior claim against the payment bond.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

How can I make a claim to recover retainage in Texas?

There is no specific provision stating when an action to enforce a claim for retainage, thus, claimants should rely on the deadline for enforcing payment bond claims, which is more than 60 days after sending the notice of claim for retainage, but less than one year after serving the notice.

• See: Texas Payment Bond Claim Guide & FAQs

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

Need More Help with Texas Retainage? We're Here.

Ask an expert for free

Check out our payment experts
Construction attorneys: Courtney Stricklen, Christopher Ng, Andrea Goldman, and Peter Ryan

Texas Retainage
Recent Questions & Answers

What should I do about retainage?

We are in the process of getting new procedures in place for our notices/liens. Going over our open invoices report and there are invoices for retainage with no previous notices or fund trapping letters that have been sent out on them, do we send a notice of intent, or is there nothing we can do at...

Clarification on Texas Retainage on public projects

I have a public project, not with TxDOT nor wholesale water supply, with work valued under $400,000. Reading the FAQs, there is a statement that the Texas public retainage laws apply to projects valued more than $400,000. However, the very next answer states that the retainage applies on public...

Why is a "Notice f Claim for Unpaid Retainage" required on a job that does not have retainage in Texas?

We supplied material.

How to file a lien in Texas

Need to file a Texas mechanics lien? File your mechanics lien with Levelset, the lien experts quickly and easily. Or you can follow the 3 steps below to file a lien yourself with Levelset’s free information.
File with the Mechanics Lien Experts
Product screenshot suggesting a found material supplier on a project details screen.
We’re the Mechanics Lien experts. With us it’s fast, easy, affordable, and done right!
File Now

Want to Learn More about How Texas Contractors Pay?
Core & Main
Rating 5.0
C
Payment Score
55 / 100
View
Thalle Construction Company (a Tully Group Company)
Rating 5.0
C
Payment Score
61 / 100
View
Aries Building Systems
Rating 5.0
C
Payment Score
75 / 100
View
Abj Construction
Rating 5.0
C
Payment Score
75 / 100
View
See other Lists of Contractors and How to Best Work With Them

Texas Retainage Statutes

Getting informed about prompt payment laws is important. An examination of Texas’ retainage laws, the rules, and regulations related to the amount and timing of allowable retained payments is important to know your rights and responsibilities as a party on a construction project. Texas’ specific laws can be found in Tex. Prop. Code Ann. §§ 53.101 et seq.Tex. Gov’t Code §§ 2252.0321 through 2252.033; and are reproduced below. Updated as of April 2022.

NOTE: Texas lien laws went through extensive changes that are effective on all original contracts entered into on or after 1/1/22 (i.e. original/prime contracts signed on or after 1/1/22)

Retainage Statute on Private Projects

§ 53.101. Funds Required to Be Reserved

[Effective for original contracts entered into on or after 1/1/22]

(a) During the progress of work under an original contract for which a mechanic’s lien may be claimed and for 30 days after the work under the contract is completed, the owner shall reserve :

(1) 10 percent of the contract price of the work to the owner; or

(2) 10 percent of the value of the work, measured by the proportion that the work done bears to the work to be done, using the contract price or, if there is no contract price, using the reasonable value of the completed work.

(b) In this section, “owner” includes the owner’s agent, trustee, or receiver.

[Effective for original contracts entered into prior to 1/1/22]

(a) During the progress of work under an original contract for which a mechanic’s lien may be claimed and for 30 days after the work is completed, the owner shall retain:

(1) 10 percent of the contract price of the work to the owner; or

(2) 10 percent of the value of the work, measured by the proportion that the work done bears to the work to be done, using the contract price or, if there is no contract price, using the reasonable value of the completed work.

(b) In this section, “owner” includes the owner’s agent, trustee, or receiver.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

§ 53.102. Payment Secured By Reserved Funds

[Effective for original contracts entered into on or after 1/1/22]

The reserved funds secure the payment of artisans and mechanics who perform labor or service and the payment of other persons who furnish material, material and labor, or specially fabricated material for any contractor, subcontractor, agent, or receiver in the performance of the work.

[Effective for original contracts entered into prior to 1/1/22]

The retained funds secure the payment of artisans and mechanics who perform labor or service and the payment of other persons who furnish material, material and labor, or specially fabricated material for any contractor, subcontractor, agent, or receiver in the performance of the work.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

§ 53.103. Lien On Reserved Funds

[Effective for original contracts entered into on or after 1/1/22]

A claimant has a lien on the reserved funds if the claimant:

(1) sends the notices required by this chapter in the time and manner required; and

(2) except as allowed by Section 53.057(f), files an affidavit claiming a lien not later than the 30th day after the earliest of the date:

(A) the work is completed;

(B) the original contract is terminated; or

(C) the original contractor abandons performance under the original contract.

[Effective for original contracts entered into prior to 1/1/22]

A claimant has a lien on the retained funds if the claimant:

(1) sends the notices required by this chapter in the time and manner required; and

(2) except as allowed by Section 53.057(f), files an affidavit claiming a lien not later than the 30th day after the earliest of the date:

(A) the work is completed;

(B) the original contract is terminated; or

(C) the original contractor abandons performance under the original contract.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

§ 53.104. Preferences

[Effective for original contracts entered into on or after 1/1/22]

(a) Individual artisans and mechanics are entitled to a preference to the reserved funds and shall share proportionately to the extent of their claims for wages and fringe benefits earned.

(b) After payment of artisans and mechanics who are entitled to a preference under Subsection (a), other participating claimants share proportionately in the balance of the reserved funds.

[Effective for original contracts entered into prior to 1/1/22]

(a) Individual artisans and mechanics are entitled to a preference to the retained funds and shall share proportionately to the extent of their claims for wages and fringe benefits earned.

(b) After payment of artisans and mechanics who are entitled to a preference under Subsection (a), other participating claimants share proportionately in the balance of the retained funds.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

§ 53.105. Owner's Liability For Failure to Retain

[Effective for original contracts entered into on or after 1/1/22]

(a) If the owner fails or refuses to comply with this subchapter, the claimants complying with Subchapter C or this subchapter have a lien, at least to the extent of the amount that should have been reserved from the original contract under which they are claiming, against the improvements and all of its properties and against the lot or lots of land necessarily connected.

(b) The claimants share the lien proportionately in accordance with the preference provided by Section 53.104.

[Effective for original contracts entered into prior to 1/1/22]

(a) If the owner fails or refuses to comply with this subchapter, the claimants complying with Subchapter C or this subchapter have a lien, at least to the extent of the amount that should have been retained from the original contract under which they are claiming, against the house, building, structure, fixture, or improvement and all of its properties and against the lot or lots of land necessarily connected.

(b) The claimants share the lien proportionately in accordance with the preference provided by Section 53.104.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

Retainage Statute on Public Projects

§ 2252.031. Definitions

In this subchapter:

(1) “Governmental entity” means:

(A) the state, a county, or a municipality;

(B) a department, board, or agency of the state, a county, or a municipality;

(C) a school district or a subdivision of a school district; or

(D) any other governmental or quasi-governmental authority authorized by statute to make a public works contract.

(2) “Prime contractor” means a person or persons, firm, or corporation contracting with a governmental entity for a public work.

(3) “Public works” includes the construction, alteration, or repair of a public building or the construction or completion of a public work.

(4) “Public works contract payment” means a payment by a governmental entity for the value of labor, material, machinery, fixtures, tools, power, water, fuel, or lubricants used or consumed, ordered and delivered for use or consumption, or specially fabricated for use or consumption but not yet delivered, in the direct performance of a public works contract.

(5) “Retainage” means the percentage of a public works contract payment withheld by a governmental entity to secure performance of the contract.

(6) “Warranty period” means the period of time specified in a contract during which certain terms applicable to the warranting of work performed under the contract are in effect.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

§ 2252.032. Retainage

(a) A governmental entity shall:

(1) include in each public works contract a provision that establishes the circumstances under which:

(A) the public works project that is the subject of the contract is considered substantially complete; and

(B) the governmental entity may release all or a portion of the retainage for:

(i) substantially completed portions of the project; or

(ii) fully completed and accepted portions of the project;

(2) maintain an accurate record of accounting for:

(A) the retainage withheld on periodic contract payments; and

(B) the retainage released to the prime contractor for a public works contract ; and

(3) for a public works contract described by Subsection (c), pay any remaining retainage described by Subdivision (2)(A) and the interest earned on the retainage to the prime contractor on completion of the work required to be performed under the contract.

(b) Except as provided by Subsection (i):

(1) if the total value of a public works contract is less than $5 million, a governmental entity may not withhold retainage in an amount that exceeds 10 percent of the contract price and the rate of retainage may not exceed 10 percent for any item in a bid schedule or schedule of values for the project, including materials and equipment delivered on site to be installed;

(2) if the total value of a public works contract is $5 million or more, a governmental entity may not withhold retainage in an amount that exceeds five percent of the contract price and the rate of retainage may not exceed five percent for any item in a bid schedule or schedule of values for the project, including materials and equipment delivered on site to be installed; and

(3) if a public works contract relates to the construction or maintenance of a dam, as that term is defined by Section 423.0045, regardless of the total value of the contract, a governmental entity may not withhold retainage in an amount that exceeds 10 percent of the contract price and the rate of retainage may not exceed 10 percent for any item in a bid schedule or schedule of values for the project, including materials and equipment delivered on site to be installed.

(c) For a competitively awarded contract with a value of $10 million or more, and for a contract that was awarded using a method other than competitive bidding, a governmental entity and prime contractor may agree to deposit in an interest-bearing account the retainage withheld on periodic contract payments.

(d) If, for the purpose of fulfilling an obligation of a prime contractor under a public works contract, the prime contractor enters into a subcontract:

(1) the prime contractor may not withhold from a subcontractor a greater percentage of retainage than the percentage that may be withheld from the prime contractor by the governmental entity under the contract; and

(2) a subcontractor who enters into a contract with another subcontractor to provide labor or materials under the contract may not withhold from that subcontractor a greater percentage of retainage than the percentage that may be withheld from the subcontractor as determined under Subdivision (1).

(e) A governmental entity may not withhold retainage:

(1) after completion of the work required to be performed under the contract by the prime contractor, including during the warranty period; or

(2) for the purpose of requiring the prime contractor, after completion of the work required to be performed under the contract, to perform work on manufactured goods or systems that were:

(A) specified by the designer of record; and

(B) properly installed by the contractor.

(f) On application to a governmental entity for final payment and release of retainage, the governmental entity may withhold retainage if there is a bona fide dispute between the governmental entity and the prime contractor and the reason for the dispute is that labor, services, or materials provided by the prime contractor, or by a person under the direction or control of the prime contractor, failed to comply with the express terms of the contract or if the surety on any outstanding surety bond executed for the contract does not agree to the release of retainage. The governmental entity must provide to the prime contractor written notice of the basis on which the governmental entity is withholding retainage under this subsection. If there is no bona fide dispute between the governmental entity and the prime contractor and neither party is in default under the contract, the prime contractor is entitled to:

(1) cure any noncompliant labor, services, or materials; or

(2) offer the governmental entity a reasonable amount of money as compensation for any noncompliant labor, services, or materials that cannot be promptly cured.

(g) A governmental entity is not required to accept a prime contractor’s offer of compensation under Subsection (f)(2).

(h) Subsection (f) may not be construed to limit either the governmental entity’s or prime contractor’s right to pursue any remedy available under the express terms of the public works contract or other applicable law.

(i) For purposes of this subsection, a project is considered formally approved if the project is the subject of a resolution approving an application for financial assistance adopted by the Texas Water Development Board before September 1, 2019, for any part of the project’s financing. Subsection (b) of this section does not apply to a governmental entity that receives financial assistance under Section 15.432 or 15.472, Water Code, for a project that is formally approved by the Texas Water Development Board or to a governmental entity that is a wholesale water supplier that supplies water to customers in 10 or more counties and is governed by Chapter 49, Water Code. A governmental entity described by this subsection shall deposit in an interest-bearing account the retainage withheld under a public works contract that provides for retainage that exceeds five percent of the periodic contract payments.

(j) This section may not be construed as affecting a governmental entity’s ability to retain certain amounts due under a contract as required by Chapter 2258.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

§ 2252.033. Exemptions

This subchapter does not apply to:

(1) a public works contract executed before August 31, 1981;

(2) a public works contract in which the total contract price estimate at the time of execution of the contract is less than $400,000; or

(3) a public works contract made by the Texas Department of Transportation under Chapter 223, Transportation Code.

Summary
Texas Retainage FAQs
Article Name
Texas Retainage FAQs
Description
Summary of Texas Retainage requirements and laws for Texas construction projects including free forms, FAQs, resources and more.
Author
Publisher Name
Levelset
Publisher Logo

Trusted by Thousands of Texas Contractors Like You
For Help With Retainage