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<ns0:Id>20250SB__120598AMD</ns0:Id>
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<ns0:ActionText>INTRODUCED</ns0:ActionText>
<ns0:ActionDate>2026-02-19</ns0:ActionDate>
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<ns0:ActionText>AMENDED_SENATE</ns0:ActionText>
<ns0:ActionDate>2026-03-24</ns0:ActionDate>
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<ns0:SessionYear>2025</ns0:SessionYear>
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<ns0:AuthorText authorType="LEAD_AUTHOR">Introduced by Senator Valladares</ns0:AuthorText>
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<ns0:Legislator>
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<ns0:House>SENATE</ns0:House>
<ns0:Name>Valladares</ns0:Name>
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<ns0:Title> An act to add Section 7204 to the Public Contract Code, relating to public contracts. </ns0:Title>
<ns0:RelatingClause>public contracts</ns0:RelatingClause>
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<ns0:Subject>Public contracts: retention: architecture or engineering services.</ns0:Subject>
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<html:p>Existing law imposes various requirements regarding the formation, content, and enforcement of public works contracts. Existing law generally requires that retention proceeds withheld from payment by a public entity be released within 60 days after the date of completion of the work of improvement, except as specified in case of a dispute. Existing law limits the allowable amount of retention proceeds withheld in a contract between a public entity and the original contractor, a contract between the original contractor and a subcontractor, and a contract between subcontractors, as specified. Existing law defines “public entity” differently for these various purposes.</html:p>
<html:p>This bill would prohibit any retention of payment for all contracts, and amendments thereto, entered into on or after January 1, 2027, directly between a public entity and an individual or legal entity permitted by law to practice the profession of architecture or engineering. The bill would define terms for its purposes, including “public entity.”</html:p>
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<ns0:Preamble>The people of the State of California do enact as follows:</ns0:Preamble>
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<ns0:Num>SECTION 1.</ns0:Num>
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Section 7204 is added to the
<ns0:DocName>Public Contract Code</ns0:DocName>
, to read:
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<ns0:Num>7204.</ns0:Num>
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(a)
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For all contracts, and amendments thereto, entered into on or after January 1, 2027, directly between a public entity and a firm, any payments to the firm for services shall not be subject to retention.
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(b)
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For purposes of this section, the following definitions shall apply:
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(1)
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“Firm” means an individual, firm, partnership, corporation, association, or other legal entity permitted by law to practice the profession of architecture or engineering.
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(2)
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“Public entity” means the state, including every state agency, office, department, division, bureau, board, or commission, the California State University, the
University of California, a city, county, city and county, including charter cities and charter counties, district, special district, public authority, political subdivision, public corporation, or nonprofit transit corporation wholly owned by a public agency and formed to carry out the purposes of the public agency.
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