House Bill 1301 Summary

• Establishes maximum retainage of 10% of estimated work value on construction contracts, with reduction to 5% retainage after contractor completes 50% of work in substantial compliance with contract requirements.

• Requires owners to release retainage to contractors within 60 days after final completion, and requires contractors to release retainage to subcontractors per Mississippi Code Section 87-7-5.

• Imposes 1% monthly interest liability on any party withholding retainage amounts exceeding the 10% maximum or failing to comply with payment timing requirements.

• Allows contractors, subcontractors, and sub-subcontractors to sue for unpaid retainage plus accrued interest, with prevailing parties entitled to recover reasonable attorneys' fees, court costs, and expenses.

• Exempts residential homebuilding, residential improvements with 16 or fewer units, contracts of $10,000 or less, and contracts awarded by the State of Mississippi or its political subdivisions; effective for contracts entered into on or after July 1, 2024.