SPRINGFIELD — Today, legislators and advocates gathered to announce the filing of Senate Bill 74 and House Bill 1224, landmark legislation to reform Illinois’ retainage policies.

“This legislation is about fairness and modernizing our laws to support Illinois contractors,” said State Senator Willie Preston (D-Chicago), chief sponsor of Senate Bill 74. “Our small businesses and workforce deserve payment practices that reflect the realities of today’s economy.”

The bills aim to end the practice of withholding payments from contractors across the board and instead adopt federal standards that impose retainage only when specific project issues arise. The bills would only apply to state agencies and public universities, not local governments or private developments.

Advocates called on lawmakers to support the legislation and act swiftly to pass it during the current session. “We urge lawmakers to recognize the urgency of this reform. Retainage policies affect thousands of workers and businesses across the state. The time to act is now,” said Jaemie Neely, Executive Director of the Federation of Women Contractors.

Advocates emphasized the detrimental effects of the current policy on contractors and small businesses, noting how delayed payments disrupt cash flow, limit job growth and threaten livelihoods.

“Retainage reform is a critical step toward fostering a healthier business environment in Illinois. Contractors should not have to wait for money they’ve rightfully earned,” said Jacky Gomez, Executive Director of the Hispanic American Construction Industry Association.

By aligning Illinois’ policies with federal standards, the legislation aims to provide contractors with the financial flexibility they need to complete projects efficiently while ensuring accountability in construction practices.

“These bills send a strong message: Illinois values its contractors and workers. Reforming retainage is not just good policy—it’s essential for economic growth and fairness,” said Representative Will Davis, chief sponsor of House Bill 1224.

“Retainage reform is long overdue. This legislation — that applies to state agencies and public universities — not only supports contractors but also protects workers and promotes economic stability in our communities,” added Representative Diane Blair-Sherlock.

The members will work over the coming months to pass legislation that strengthens Illinois’ retainage policies.