Time to Dump Retainage
February 2005This month I want to talk about the elimination of retainage. Currently, subcontractors have to wait anywhere from three months to a year after substantial completion before they receive their money. I consider this to be unregulated banking, and it should not be tolerated in our industry.
Many of our projects require a performance bond, so why do we need retainage? This sounds and smells like double-dipping into the subs' money by the owner or general contractor, who pay no interest on the use of the subs' money.
What a deal!
The subs do approximately 85 percent of the work on a project-that's a tidy amount to finance interest-free. It is worth noting that many of the federal government projects are not requiring retainage, so why is the private sector not following suit? It's not going to get better until we, the subs, make it better. If you would like to make things better, call me or the headquarters office of the Association of the Wall and Ceiling Industry at 703.534.8300.
On another front, I want to remind everyone that they can save $250 by registering before March 1 for AWCI's Expo: Construction Directions 2005. It is going to be a great show in Tampa, Fla., March 29-April 2.
For members who can't make it, AWCI's Academy, Feb. 11-12 in St. Louis, Mo., might be an alternative. It is an opportunity-particularly for younger management people-to upgrade your skills. We've been running the Academy for a few years, and it has been a great success.
Also worth noting on the education front are two upcoming education seminars on the application of exterior insulation and finish systems, one in New Orleans and the other in Chicago, where EIFS applicators complete their certification.