5%, it’s about Time
July 2014
Dear Senator:
As leaders of associations representing hundreds of small businesses and their workers in the
construction industry, we are proud to lend our support to S2120 an act that
provides for fair “retainage” payments and payment schedules on private construction projects
over 3 million dollars.
Retainage is unique to the construction industry. It allows the owner of a project to hold back
funds owed on a project as security until the successful completion of the project. In
Massachusetts, generally 10% is held back from every payment to a contractor from the start of a
project until long after a project is done.
We recognize the need to withhold a portion of funds to assure the successful completion of a
project and for the owners to have a fair system in place to close out a project and issue final
payment. However, the current practice of holding back 10% on large scale private
developments is simply too much – and it is held too long.
We were pleased that the Associated Subcontractors of Massachusetts and the Associated
General Contractors of Massachusetts worked collaboratively to craft language that responded to
genuine concerns and found a way to get earned money into the hands of small businesses and
their workers in a fair and timely manner.
S2120’s proposed 5% retainage amount is the same amount required on
public projects in Massachusetts. It works and it’s better for small businesses and the local
economy.
We support this bill because it helps small businesses. It gets money out of bank accounts and to
the small businesses and workers who have earned that money.
S2120 will make a difference to countless small businesses and their employees
in Massachusetts. We urge you to support this legislation.
Thank you for your consideration.
Sincerely,
Tom Theroux
Executive Director,
PHCC of MA
Thomas S. Gunning, Director
Industry & Government Affairs
Building Trade Employers Association
Hugh Kelleher, Executive Director
Plumbing, Heating & Cooling
Contractors of Greater Boston
Glenn Kingsbury
Executive Manager
National Electrical Contractors Association
Greater Boston
David Keaney
Stephen P. Affanato
Executive Vice President
New England Mechanical Contractors
Association/MSCA
Sue Mailman
Susan Coghlin Mailman
Coghlin Electrical Contractors
President, National Electrical Contractors
Association, Central Massachusetts
J. David Keaney
Manager
National Electrical Contractors Association
Western Massachusetts
Stephen Capone
Capone Iron Corporation
President, Steel Fabricators of New England
Jim Spiro
Jim Spiro
Executive Director
Northeast Flooring Contractors Association