CA SB61

Limits retention payments on private construction contracts to no more than 5% of each payment, with total retention not exceeding 5% of the contract price, effective for contracts entered into on or after January 1, 2026

Requires subcontractor retention percentages to match or be lower than the percentage specified in the owner-direct contractor agreement

Exempts contractors from the 5% cap if they provided written notice requiring a performance and payment bond before bidding and the subcontractor failed to furnish such bond from an admitted surety insurer

Exempts residential projects that are not mixed-use and do not exceed four stories from the retention payment limitations

Awards reasonable attorney's fees to the prevailing party in any legal action to enforce these retention payment provisions