Talking Retainage with the Texas Construction Association

One issue unique to the construction industry is RETAINAGE. Retainage is a statutory payment structure that requires owners to withhold 10% of each payment until the construction project is complete. This can be months or even years after a subcontractor completes its work. Moreover, if the bank ends up foreclosing on a project, subcontractors likely lose their 10% retainage altogether.

THE BOTTOM LINE: Texas law requires subcontractors to finance 10% of every construction project with little to no security; and because of that risk, the Texas Construction Association continues to work to increase security for those funds – funds that belong to the subcontractor for labor and materials already supplied and installed in a building.

For more information about the Texas Construction Association go to www.texcon.org.