Public Act 104-0168 Signed Into Law: A Victory for Prompt Payment and Small Business Growth
FWC is thrilled to announce that Governor J.B. Pritzker has signed HB1224/SB74 into law, now officially Public Act 104-0168. This critical legislation removes the default 10% retention requirement on state-funded construction contracts, giving state agencies the flexibility to issue full, timely payments upon satisfactory completion of work. The law marks a major step toward ensuring fair and prompt payment practices for all contractors, particularly small, diverse, and emerging businesses.
🔍 What the Law Does:
• Eliminates automatic 10/5% retainage on contracts with state agencies, replacing it with a case-by-case retention policy that reflects actual project risk.
• Supports full and on-time payments to contractors, reducing delays in cash flow that have historically burdened subcontractors and small firms.
• Encourages earlier closeouts, helping contractors wrap up projects efficiently and freeing up capital to pursue new opportunities.
• Fosters capacity building by easing financial strain, especially for M/W/DBEs and newer market entrants. This reform will enhance sustainability, equity, and competition in Illinois’ construction industry. FWC proudly backed this effort as part of our ongoing commitment to eliminate barriers that hinder growth for women-owned and minority-owned contractors.
Thank you to all of our coalition partners, legislative champions, and members who helped advocate for this critical change. Together, we’re building a better future for contractors in Illinois.
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