N.Y. Gen. Bus. Law § 756-c

§ 756-c. Retention. By mutual agreement of the relevant parties an\nowner may retain no more than five per centum of the contract sum as\nretainage. A contractor or subcontractor may also retain no more than\nfive per centum for retainage and in no case shall retainage exceed the\nactual percentage retained by the owner. Retainage shall be released by\nthe owner to the contractor no later than thirty days after the final\napproval of the work under a construction contract. In the event that an\nowner fails to release retainage as required by this article, or the\ncontractor or subcontractor fails to release a proportionate amount of\nretainage to the relevant parties after receipt of retainage from the\nowner, the owner, contractor, or subcontractor, as the case may be,\nshall be subject to the payment of interest at the rate of one percent\nper month on the date retention was due and owing.\n