A contractor bills $75,000 on a job. The contract requires 5% retention and the owner also back-charges $1,500 for a utility relocation. How much will the contractor receive on this billing?
Explanation
Retention = 5% of $75,000 = $3,750, leaving $71,250. Subtract the $1,500 back-charge: $71,250 - $1,500 = $69,750 (b). Civil Code §8811 caps private-works retention at 5% for contracts entered into on or after January 1, 2026. (a) $71,250 stops after the retention and forgets the back-charge. (c) $73,500 deducts only the back-charge and forgets the retention. (d) $66,000 is the answer under the superseded 10% retention: $75,000 - $7,500 - $1,500.
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