{"data":{"id":"us-md/md.-code-state-finance-and-procurement-13-225","jurisdiction":"us-md","citation":"Md. Code, State Finance and Procurement § 13–225","heading":"","body":"(a) (1) In this section the following words have the meanings indicated.\n(2) “Payment security” has the meaning stated in § 17-101 of this article.\n(3) “Performance security” has the meaning stated in § 17-101 of this article.\n(b) (1) If a contractor has furnished 100% payment security and 100% performance security in accordance with Title 17, Subtitle 1 of this article under a State procurement contract for construction, the percentage specified in the contract for retainage may not exceed 5% of the total amount.\n(2) In addition to retainage, a primary procurement unit and the Maryland Transportation Authority may withhold from payments otherwise due a contractor any amount that the unit reasonably believes necessary to protect the State’s interest.\n(3) Retainage withheld by a primary procurement unit and the Maryland Transportation Authority may be deposited in an interest-bearing escrow account in accordance with § 15-108 of this article.\n(c) (1) A contractor may not retain a percentage of payments due a subcontractor that exceeds the percentage of payments retained by the primary procurement unit or the Maryland Transportation Authority.\n(2) Paragraph (1) of this subsection may not be construed to prohibit a contractor from withholding any amount in addition to retainage if the contractor determines that a subcontractor’s performance under the subcontract provides reasonable grounds for withholding the additional amount.\n(d) (1) A subcontractor may not retain a percentage of payments due a lower tier subcontractor that exceeds the percentage of payments retained from the subcontractor.\n(2) Paragraph (1) of this subsection may not be construed to prohibit a subcontractor from withholding any amount in addition to retainage if the subcontractor determines that a lower tier subcontractor’s performance under the subcontract provides reasonable grounds for withholding the additional amount.\n(e) If retainage has been placed in escrow under § 15-108 of this article, each payment of retainage shall include a pro rata portion of interest earned.\n(f) This section may not be construed to limit the application of the provisions of Title 17, Subtitle 1 of this article.","path":["Article - State Finance and Procurement"],"source_url":"https://mgaleg.maryland.gov/mgawebsite/Laws/StatuteText?article=gsf\u0026section=13-225","current_through":"2026-01-01","vintage":"","retrieved_at":"2026-09-14T20:00:48Z","sha256":"682d7ce0d24b9aa4ec0cf33cb2b20f5425178d1fac2df9de6c5862aeb4f01025","source_id":"us-md","stale":false,"prev":"us-md/md.-code-state-finance-and-procurement-13-224","next":"us-md/md.-code-state-finance-and-procurement-13-226"},"notice":"GroundRules: Original legal text. Not legal advice."}