AB 2173 – Payment Of Public Contracts

Assembly Bill 2173 eliminates the existing sunset date in Sections 7201 and 10261 of the Public Contract Code, which were set to expire automatically on January 1, 2023.  The Public Code authorizes a public entity in a contract to retain proceeds from any payment not to exceed 5% of the price.  A public entity may retain more than 5% on specific projects where the director of the applicable department has made, or the governing body of the public entity or designated official of the public entity has approved, a finding prior to the bid that the project is substantially complex and requires higher retention and the department or public entity includes both this finding and the actual retention amount in the bid documents.

(AB 2173 amends Sections 7201 and 10261 of the Public Contract Code.)