Two acts, one structure
Kansas has two parallel "fairness" statutes:
| Private projects | Public projects | |
|---|---|---|
| Act | Kansas Fairness in Private Construction Contract Act | Kansas Fairness in Public Construction Contract Act |
| Statutes | K.S.A. 16-1801 to 16-1807 | K.S.A. 16-1901 and following |
| Owner | A person with an ownership interest in real property | A public entity: the state, cities, counties, school districts, state universities, special districts and similar |
| Key exclusion | Owner must be a property owner (tenant contracts may fall outside, see below) | Roads, highways and bridges are excluded from "construction" |
Both acts say their rights and duties cannot be waived by contract, so contract language that tries to extend payment deadlines or raise retainage beyond the statute is generally unenforceable.
Payment deadlines
| Step | Deadline | Late-payment interest |
|---|---|---|
| Owner pays contractor | 30 days after receiving a timely, properly completed, undisputed request | 18% per year on the undisputed amount |
| Public owner, extenuating circumstances | Up to 45 days | 18% per year |
| Architect or engineer forwards request (public act) | 7 business days | — |
| Contractor pays subcontractor | 7 business days after receiving payment from the owner | 18% per year, starting the 8th business day |
| Subcontractor pays sub-subcontractor | 7 business days after receiving payment | 18% per year |
The trigger words matter: deadlines run only on timely, properly completed, undisputed requests. Submitting complete, correctly formatted pay applications on schedule is the best way to put these protections to work.
Retainage rules
- Default cap: 5% of the contract or subcontract value.
- Absolute cap: 10%, allowed only when the owner or contractor determines a higher rate is needed to ensure performance.
- Release: all remaining retainage on undisputed amounts is due within 30 days after substantial completion. Retainage on work still in progress can be held until 30 days after that work is finished.
- Early release to a subcontractor is possible when the owner, contractor and architect or engineer agree that the subcontractor's work is complete and satisfactory.
- Alternate security: a contractor or subcontractor may request alternate security in place of retainage before work begins, and the party holding retainage chooses which type to accept. Performance and payment bonds do not count as alternate security.
- Interest: unpaid retainage due under the act bears 18% annual interest.
The tenant exception
The private act applies to contracts with an owner. A Kansas appellate decision, as reported by Levelset, held that work contracted by a tenant was not covered because the tenant was not the owner. That matters for tenant finish: if your contract is with the tenant, not the landlord, you may not have the statute's protections. Review payment terms, security and lien rights carefully on tenant-finish work.
Why estimators care
Payment terms are a real cost:
- Carrying cost of retainage. On a long project, 5% to 10% of your contract is held until substantial completion. Price the financing cost, especially for subcontractors with thin margins.
- Cash-flow risk. Owners who routinely dispute pay applications can delay payment beyond 30 days without triggering interest. Factor owner history into your markup.
- Contract review. Check pay-application formats, approval steps and retainage percentages against the statute before bidding.
These items belong in the commercial-terms section of our Kansas bid checklist. For public work, see bidding public projects in Kansas.
This guide summarizes Kansas statutes for estimating and bidding. It is not legal advice. Read the current statute text and consult a Kansas construction attorney for specific disputes.
Frequently asked questions
How long does an owner have to pay a contractor in Kansas?
Under both the private and public fairness acts, an owner must pay within 30 days after receiving a timely, properly completed, undisputed request for payment. The public act allows up to 45 days when extenuating circumstances prevent approval within 30 days.
How fast must a Kansas contractor pay subcontractors?
Within seven business days of receiving payment from the owner, for amounts covered by a timely, properly completed, undisputed request from the subcontractor. The same rule flows down to lower-tier subcontractors.
What is the maximum retainage in Kansas?
Retainage is limited to 5% of the contract or subcontract value, and can be raised only when a higher rate is needed to ensure performance, but never above 10%.
When must retainage be released in Kansas?
Within 30 days after substantial completion of the project. Retainage tied to work still being performed can be held until 30 days after that work is finished.
Does the Kansas prompt pay law apply to road projects?
The public act's definition of construction excludes the design, construction, alteration, renovation, repair or maintenance of a road, highway or bridge, so those projects follow their own contract terms.
Sources and further reading
- Kansas Revisor of Statutes, K.S.A. 16-1803 (private construction payments)
- Kansas Revisor of Statutes, K.S.A. 16-1804 (private construction retainage)
- Kansas Revisor of Statutes, K.S.A. 16-1802 (private act definitions)
- Kansas Revisor of Statutes, K.S.A. 16-1902 (public act definitions)
- Kansas Revisor of Statutes, K.S.A. 16-1903 (public construction payments)
- Kansas Revisor of Statutes, K.S.A. 16-1904 (public construction retainage)
- Levelset, In Kansas, construction work for a tenant isn't covered by prompt payment law
This guide is general information for estimating and bidding, not tax or legal advice. Confirm requirements with the agency or jurisdiction that governs your project.