Terms of Payment
Codified Ordinances of Cleveland § 185.41
in effect§ 185.41 Terms of Payment
(a) The contractor shall be required to make current requests for payment in writing, not more than one (1) each month, and submit them to the director who executed the contract on behalf of the City (“director”) for approval. The request shall be dated the last working day of the month and be submitted to the director by the fifth day of the following month. The request for payment shall cover the materials in place complete, and the amount of work performed in accordance with the contract during the preceding payment period and the value thereof. At the discretion of the director, allowances may be made for nonperishable materials which are to be incorporated into the work, when delivered and properly stored upon the site. Upon approval of the contractor’s request for payment, the director will make estimates in writing, one (1) each payment period of the materials in place complete and the amount of work performed, all in accordance with the contract. Upon approval by the director, the contractor shall be paid as follows, except as otherwise provided in divisions (b) and (c) of this section:
(1) the amount of each such estimate less three percent (3%) which the City shall retain until satisfactory completion of fifty percent (50%) of the work of any separate phase of the contract or of all contract work, or of the estimated total contract amount of a public improvement by requirement contract, as applicable, as determined by the director, and less all prior payments;
(2) upon the director’s written certification of satisfactory completion as subdivision (a)(1) of this section provides, the amount of each such estimate less one and a half percent (1.5%) which the City shall retain until final acceptance of any separate phase of the contract or of all contract work, or of the estimated total contract amount of a public improvement contract, as applicable, as determined by the director, and less all prior payments; and
(3) upon the director’s written certification of final acceptance as subdivision (a)(2) of this section provides, the whole amount of money then due to the contractor, except such sums which have already been paid and except such sums as may have been expended by the City or may be due the City or properly deductible under the contract terms and less all prior payments.
(b) The director may, at any time, increase the retainage percentages set forth in division (a) of this section by not more than ten percent (10%) of the contract price or each separate phase’s price or the estimated contract amount of a public improvement by requirement contract, as applicable, to protect the City’s interests for incomplete, defective, delayed, or unsatisfactory work, or for costs or damages incurred by the City that are the contractor’s obligations under the contract; or charges the City may assess against the contractor under the contract including, but not limited to, liquidated damages.
(c) Contracts below five hundred thousand dollars ($500,000.00) are exempt from retainage requirements.
(d) The City will neither deposit retainage in an escrow account nor pay interest on such retainage.
(e) The payment of the moneys as provided in this section shall constitute a full and complete discharge of all the duties and obligations of the City under the contract.
Ord. No. 599-2025. Passed 5-19-25, eff. 5-22-25)
Source: City of Cleveland, Ohio, Codified Ordinances and City Charter (American Legal Publishing, codelibrary.amlegal.com)URL: https://codelibrary.amlegal.com/codes/cleveland/latest/cleveland_oh/0-0-0-6449Fetched: 11/1/2026