Ohio caps retainage at five percent on private construction projects exceeding one million dollars

Original title: Limit retainage in certain private construction projects

Last action · November 5, 2025: Referred to Small BusinessSponsors: Ty Mathews and 5 others

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What This Bill Would Do

Private construction contracts and subcontracts valued over one million dollars entered into on or after the effective date are prohibited from withholding greater than five per cent of the expected contract value. This restriction applies to non-public projects and overrides contrary provisions in existing construction law.

Why it matters

The measure limits the percentage of contract funds that private project owners and contractors can hold back during construction, affecting cash flow for contractors, subcontractors, and material suppliers on large projects.

Who It Would Affect

Groups the bill's text would affect if enacted, as described in the record. Being affected is not a position for or against it.

Directly affected

Contractors and subcontractors

Construction contracts and subcontracts over one million dollars are restricted from including retainage terms exceeding five per cent.

Directly affected

Private project owners

Owners of private projects with an expected value greater than one million dollars are prohibited from withholding retainage in amounts greater than five per cent.

Directly affected

Material suppliers

Suppliers furnishing materials under contracts subject to the new section face altered conditions regarding the withholding of contract funds.

Key Facts

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Frequently Asked Questions

What private construction projects are affected by this bill?

The bill applies to private construction projects—meaning non-public projects—with an expected value greater than one million dollars under a contract entered into on or after the effective date.

Does this bill apply if there is a dispute over the quality of work?

No. The bill specifies that nothing requires the payment of if there is a good faith claim directly related to the work, labor, or materials furnished by the contractor, subcontractor, or supplier.

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Where This Stands

Currently in committee. The next step in the legislative lifecycle is Floor Vote.

Procedural history

2 actions

Nov 5, 2025HouseCommittee
Referred to Small Business
Nov 4, 2025HouseIntroduced
Introduced

Version history

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