Who this applies to
Section 38:2248 of the Louisiana Revised Statutes governs contracts for the construction, alteration or repair of public works let by the state, its agencies, boards and subdivisions, or any other public entity [1]. Two exclusions shape it: the provisions cannot be waived, and they do not apply to the Department of Transportation and Development [1].
The statute speaks to public works only. Private construction is not addressed by it, so this page covers public work alone; the terms of a private job come from its contract, with a lawyer for anything the contract leaves open.
What the rule says
The limit depends on the size of the project:
- Projects under $500,000 [1]: the public entity may withhold no more than 10% [1] of the contract price.
- Projects of $500,000 or more [1]: the ceiling is 5% [1] of the contract price.
The measure is the contract price, not each payment [1]. The withholding may last until 45 days [1] after formal acceptance of the work is recorded, or after notice of default by the contractor or a subcontractor.
A second limit sits alongside the percentage. Under § 38:2248(B)(1), the public entity may not withhold more than the value of the punch list [1]. Punch-list items that have been completed are paid when the 45-day [1] lien period expires.
How to comply
- Place the project in its band. Read the contract price against the $500,000 [1] line, then compare the retainage clause with 10% [1] or 5% [1] of that price.
- Track recordation. The 45 days [1] run from the recordation of formal acceptance, not from the date the work was finished. The related sections are § 38:2241.1 on substantial completion and § 38:2242(B) on the 45-day period [1].
- Price the punch list. Once a punch list exists, the amount withheld is capped at its value [1].
- Contract language. A clause that purports to waive these limits does not change them, because § 38:2248 cannot be waived [1].
- DOTD work. A Department of Transportation and Development contract is outside this section [1].
This page lays out the statute's terms; it does not settle how they apply to a given contract. That is for the section itself, linked in the Sources below, the contract and a lawyer.
What changed recently
The section traces back to Acts 1954, No. 583, and was last amended by Acts 2020, No. 92 and Acts 2022, No. 756 [1].
Related
- Retainage calculator: turn a percentage of the contract price into a dollar holdback.
- Retainage laws by state: Louisiana's public works rule beside other states.