The “retainage reform” bill, S. 365, has been signed into law by South Carolina Gov. Mark Sanford. Effective on June 1, retainage withheld on state construction projects in South Carolina may not exceed 3.5 percent. This applies to all projects awarded under South Carolina’s Consolidated Procurement Code.
The American Subcontractors Association of South Carolina says that subcontractors should know their rights and inform prime contractors of the new law, and understand that the law prohibits the withholding of more than 3.5 percent retainage by the prime contractor on all applicable projects.
On May 18, the South Carolina House Committee on Labor, Commerce and Industry passed the bill, and the South Carolina Senate passed the measure March 2.