Florida retainage law: 5% public cap, 20-business-day release (2026)

By Oussama Chicha, EditorUpdated September 23, 2026Checked against primary sources · not yet reviewed by a licensed professionalFact-checked September 23, 2026

Quick answer

Florida public entities may withhold at most 5% of each progress payment (Fla. Stat. §§ 255.078, 218.735; § 255.078 exempts contracts of $200,000 or less) and pay the balance, less 150% of the cost to finish the punch list, within 20 business days after the list is made (§ 255.077). Private work has no cap; the balance with retainage is due within 14 days of substantial and punch-list completion (§ 715.12).

Private work

Florida · Private workVerified 2026-09-22

Retainage cap: No statutory percentage cap for private work. Fla. Stat. § 715.12(7)(a) permits an owner and contractor to 'agree to a provision that allows the owner to withhold a portion of each progress payment until substantial completion of the entire project', and § 715.12(7)(b) allows any obligor and obligee to agree to withholding until completion of the entire project. Section 715.12 applies only to written contracts to improve real property entered into after December 31, 1992 for which a construction lien is authorized under part I of chapter 713 (§ 715.12(2)).
Deadline: 14 days; The owner must pay the balance of the contract price, including the amounts withheld from progress payments, within 14 days after any of: (1) an architect or engineer certifies substantial completion under the contract and the contractor substantially completes the items on the owner's written punchlist; (2) issuance of a certificate of occupancy plus punchlist completion; or (3) the owner or its tenant takes possession plus punchlist completion. If the contract sets no time for the owner to deliver the punchlist, that period is 15 days from the certificate of substantial completion, the certificate of occupancy, or possession, whichever occurs first; if no punchlist is given in time, interest begins 14 days after that first event. For phased projects the subsection applies to each phase.
Statute: Fla. Stat. § 715.12 (Construction Contract Prompt Payment Law).

What the statute says

An owner and a contractor may agree to a provision that allows the owner to withhold a portion of each progress payment until substantial completion of the entire project. The owner shall pay the contractor the balance of the contract price, including the amounts withheld from the progress payments, within 14 days after any of the following events occur.

Fla. Stat. § 715.12 (Construction Contract Prompt Payment Law). · Archived copy of the official text, captured 2025-03-30

Public work

Florida · Public workVerified 2026-09-22

Retainage cap: 5%; For state and other public entities, Fla. Stat. § 255.078(1): 'With regard to any contract for construction services, a public entity may withhold from each progress payment made to the contractor an amount not exceeding 5 percent of the payment as retainage.' It does not apply to construction services paid for in whole or part with federal funds subject to contrary federal requirements (§ 255.078(5)), nor to construction services whose total contract cost is $200,000 or less (§ 255.078(6)); a 2020 note provides that the 2020 amendments to §§ 255.05 and 255.078 do not apply to contracts executed under chapter 337. Local governmental entities: Fla. Stat. § 218.735(8)(a) imposes the same 5 percent ceiling. The 20-business-day release rule is in Fla. Stat. § 255.077(4).
Deadline: 20 days; Punchlist-driven. The contract must provide for developing a list of incomplete items within 30 calendar days after substantial completion (up to 45 by contract for projects of $10 million or more). Within 20 business days after developing the list, and after receipt of a proper invoice or payment request, the entity must pay the remaining contract balance including retainage, less 150 percent of the estimated cost to complete the listed items; on completion of the list the contractor may request the rest. If the entity fails to develop the list on time, the contractor may bill for all remaining retainage and must be paid within 20 days (§ 255.077(9)) or 20 business days (§ 218.735(7)(j)).
Statute: Fla. Stat. § 255.078 (public construction retainage, 5% cap) and § 255.077(4) (project closeout, remaining retainage paid within 20 business days); Fla. Stat. § 218.735(7)-(8) for local governmental entities.

What the statute says

With regard to any contract for construction services, a public entity may withhold from each progress payment made to the contractor an amount not exceeding 5 percent of the payment as retainage.

Fla. Stat. § 255.078 (public construction retainage, 5% cap) and § 255.077(4) (project closeout, remaining retainage paid within 20 business days); Fla. Stat. § 218.735(7)-(8) for local governmental entities. · Archived copy of the official text, captured 2026-03-06

Who this applies to

Public entities. Section 255.078 limits retainage on any public entity's contract for construction services ^[1], and § 218.735 applies the same ceiling to local governmental entities ^[3]. The state-level cap does not reach construction services with a total contract cost of $200,000 or less ^[1], or work paid for in whole or in part with federal funds subject to contrary federal requirements, and its 2020 amendments do not apply to contracts executed under chapter 337 ^[1].

Private owners. Section 715.12, the Construction Contract Prompt Payment Law, governs written contracts to improve real property for which part I of chapter 713 authorizes a construction lien, if entered into after December 31, 1992 ^[4]. It reaches down the chain too: any obligor and obligee may agree to withholding until completion of the entire project ^[4].

What the rule says

Florida caps the public side and puts the private side on a clock. A public entity may withhold up to 5% ^[1] of each progress payment, and it may choose to do less (a lower rate, a rate cut in steps under a schedule in the contract, or release of some or all retainage at any point), though none of that is required ^[1]. A private owner may hold back whatever portion of each progress payment the contract allows until substantial completion of the entire project, but once the triggering events have happened, the whole balance, retainage included, is due within 14 days ^[4].

How to comply

Public contracts: the punch-list sequence

The contract has to provide for a list of incomplete items, developed within 30 calendar days ^[2] after substantial completion; on projects of $10 million ^[2] or more the contract may allow up to 45 calendar days ^[2].
Within 20 business days ^[2] after the list is developed, and once a proper invoice or payment request is in, the entity pays the rest of the contract balance, retainage included, less 150% ^[2] of the estimated cost to complete the listed items.
When the listed items are complete, the contractor may request the amount still held.
If the entity does not develop the list in time, the contractor may bill for all remaining retainage. Payment is then due within 20 days under § 255.077(9) ^[2], or within 20 business days under § 218.735(7)(j) ^[3] when the entity is a local government.

Retainage released to the contractor that is attributable to a subcontractor's or supplier's work has to be passed on to them in a timely way ^[1].

Private contracts: the payout clock

The 14 days ^[4] run from any one of these events:

an architect or engineer certifies substantial completion under the contract, and the contractor substantially completes the items on the owner's written punch list;
a certificate of occupancy issues, and the punch-list items are completed;
the owner or its tenant takes possession, and the punch-list items are completed.

If the contract gives no deadline for the owner's punch list, the owner has 15 days ^[4] from the certificate of substantial completion, the certificate of occupancy or possession, whichever occurs first; with no punch list delivered in time, interest begins 14 days ^[4] after that first event. On a phased project the rule applies to each phase.

Retainage kept past the deadline accrues interest at the § 55.03 rate plus 12% a year ^[4], from the date payment was due until it is received, or at the contract rate if that is higher. The right to that interest cannot be waived before payment is due ^[4]. The contractor may also substitute Treasury or Florida securities, or insured certificates of deposit, for cash retainage ^[4].

What changed recently

Section 255.078 carries a history of ch. 2005-230, ch. 2020-173 and ch. 2023-134 ^[1], and § 255.077, which governs closeout and the punch list, lists the same three session laws ^[2].

Retainage calculator: the pay-application math behind a Florida progress payment.
Retainage laws by state: the state index.