§ 22-9-604 - Procedure. - Arkansas Statutes

22-9-604. Procedure.

(a) (1) In the case of a construction contract entered into between a public agency and a contractor who is required to furnish a performance bond, the contractor shall be entitled to payment of ninety-five percent (95%) of the earned progress payments when due, with the public agency retaining five percent (5%) to assure faithful performance of the contract.

(2) If the construction contract allows for phased work in which completion may occur on a partial occupancy, any retention proceeds withheld and retained under this section shall be partially released within thirty (30) days under the same conditions under this section in direct proportion to the value of the part of the capital improvement completed.

(b) All sums withheld by the public agency shall be paid to the contractor within thirty (30) days after the construction contract has been completed.

(c) In the event the construction contract requires the contractor to purchase and furnish materials or equipment that will be stored on the job site or in a bonded warehouse by the contractor and used in the job as required by the construction contract, no retainage will be withheld on that amount of the submitted progress payment pertaining to the cost of these stored materials or equipment.