Miami Contractor Payment Schedules and Lien Rights

Florida's construction payment framework imposes specific statutory obligations on project owners, general contractors, and subcontractors operating within Miami and Miami-Dade County. Payment schedules, retainage caps, and lien rights are governed primarily by the Florida Construction Lien Law (Florida Statutes Chapter 713) and the Florida Prompt Payment Act (Florida Statutes §§ 255.071–255.078 for public contracts and §§ 715.12 for private), which together set enforceable timelines, notice requirements, and priority hierarchies that affect every party on a construction site. Understanding how these rules interact is essential for contractors, subcontractors, material suppliers, and property owners navigating Miami's active construction market.

• Definition and Scope
• Core Mechanics or Structure
• Causal Relationships or Drivers
• Classification Boundaries
• Tradeoffs and Tensions
• Common Misconceptions
• Checklist or Steps
• Reference Table or Matrix

Definition and Scope

A contractor payment schedule is a contractually and often statutorily defined sequence of disbursements tied to construction milestones, draw requests, or calendar intervals. In Florida, payment schedules on private residential projects are further constrained by disbursement requirements under Florida Statutes § 713.346, which governs how funds received by a contractor from an owner must be applied to subcontractors and suppliers before any profit margin is retained.

Lien rights are the legal mechanism by which unpaid contractors, subcontractors, sub-subcontractors, laborers, and material suppliers assert a security interest against the improved property. Florida's lien law creates a statutory lien — meaning it arises from statute, not from a recorded agreement — and attaches to real property from the moment labor or materials are first furnished under § 713.07.

Geographic and legal scope of this page: Coverage is limited to projects within the City of Miami and Miami-Dade County, Florida. Florida state law — primarily Chapter 713 and the Prompt Payment Acts — governs all private and public construction lien rights statewide. Miami-Dade County and the City of Miami do not enact separate lien statutes; local ordinances affect permitting and contractor licensing (see Miami-Dade County Contractor Rules) but do not alter state-level lien priority or notice deadlines. Projects located in Broward County, Palm Beach County, or other Florida jurisdictions fall outside this page's scope.

Core Mechanics or Structure

Payment Schedule Structure

Florida law does not mandate a single universal payment schedule format for private projects, but it does impose constraints. Under § 713.346, a contractor who receives payment from an owner must apply those funds to pay undisputed amounts owed to subcontractors within 30 days of receipt. Failure to do so constitutes misappropriation of construction funds — a potential criminal exposure under Florida Statutes § 713.345.

Retainage on private contracts is capped at 10% of each progress payment until the project reaches 50% completion, after which retainage may be reduced to 5% if the work is proceeding satisfactorily (§ 713.346(3)). On public projects, the Florida Prompt Payment Act caps retainage at 10% through 50% completion and mandates reduction thereafter (§ 255.078).

Lien Notice Requirements

The notice system is the procedural backbone of lien rights. Parties who do not have a direct contract with the property owner — subcontractors, sub-subcontractors, material suppliers — must serve a Notice to Owner (NTO) within 45 days of first furnishing labor or materials (§ 713.06(2)(a)). Missing this 45-day window eliminates lien rights for all work performed before the notice was served.

General contractors with a direct owner contract are not required to serve an NTO but must record a Claim of Lien within 90 days of last furnishing labor or materials, and must file a foreclosure action within 1 year of recording that claim (§ 713.08).

Owners may protect themselves by recording a Notice of Commencement before construction begins (§ 713.13), which establishes the project record and triggers the NTO requirement for all downstream parties. This notice must be posted at the jobsite and recorded with Miami-Dade County's official records.

For a full treatment of contract structures that underpin these payment mechanics, see Miami Contractor Contracts and Agreements and the broader Miami General Contractor Services reference.

Causal Relationships or Drivers

Payment schedule disputes in Miami construction projects frequently arise from 3 interdependent factors:

1. Draw-based disbursement mismatches — When a lender controls draw releases tied to inspection milestones, contractors may receive payment weeks after completing a phase, creating a downstream delay for subcontractors waiting on the 30-day pass-through clock.

2. Notice of Commencement gaps — Projects on which a Notice of Commencement was not recorded before work began create ambiguity about lien priority dates. Miami-Dade County building permits require a Notice of Commencement for projects exceeding $2,500 in value (Miami-Dade County Code § 10-33), but enforcement gaps in informal renovation markets remain.

3. Storm-driven construction surges — After major weather events, Miami's construction volume spikes, and subcontractor chains extend further than on standard projects. Extended chains mean more parties must serve timely NTOs, and administrative failures multiply. The relationship between storm response and payment complications is documented in contractor dispute patterns covered under Miami Contractor After-Storm Response.

Florida's payment trust fund doctrine (§ 713.345) treats construction funds as trust property, imposing a fiduciary-like duty on any contractor who receives owner payment. Misapplication — even to a contractor's own overhead — can constitute a first-degree misdemeanor or, for funds exceeding $1,000, a third-degree felony under Florida law.

Classification Boundaries

Miami construction projects fall into distinct categories for purposes of payment law:

Private Residential Projects (1–4 units): Governed by Chapter 713 lien law and the private Prompt Payment Act (§ 715.12). Owner-occupied homes carry the homestead exemption, but homestead status does not immunize the property from a valid lien — it only affects enforcement priority after judgment.

Private Commercial Projects: Also governed by Chapter 713, with no homestead complications. Retainage and payment timing are contractually negotiable subject to statutory floors.

Public Projects (government-owned): Mechanics liens do not attach to public property. Instead, unpaid parties on public jobs pursue claims against the contractor's payment bond, which is mandatory for public contracts exceeding $200,000 under Florida Statutes § 255.05. The notice to contractor and bonding authority must be served within 90 days of last furnishing.

Federal Projects in Miami: Federal Davis-Bacon Act wage requirements apply to federally funded construction, and the Miller Act (40 U.S.C. §§ 3131–3134) governs payment bond claims on federal contracts exceeding $100,000 — a distinct framework from Florida state law.

For licensing prerequisites that interact with payment eligibility, see Miami Contractor License Requirements and Miami Contractor Insurance and Bonding.

Tradeoffs and Tensions

Retainage: Security vs. Cash Flow

Retainage protects owners from deficient or incomplete work by withholding a portion of earned payment until project closeout. For subcontractors on large commercial projects, retainage withheld at 10% across a multi-year project can represent hundreds of thousands of dollars of earned but unavailable capital. Florida's statutory cap limits the maximum retainage percentage but does not set a mandatory release timeline beyond project substantial completion.

Lien Waivers and Conditional Releases

Owners and lenders routinely require lien waivers as a condition of each progress payment. A conditional waiver (effective only upon actual receipt of funds) is the standard protective form; an unconditional waiver operates immediately upon execution regardless of whether payment clears. Florida does not prescribe mandatory lien waiver forms, unlike California, which requires statutory forms under California Civil Code § 8132. Miami contractors executing unconditional waivers before fund clearance forfeit lien rights with no statutory remedy.

Speed vs. Documentation

Fast-moving Miami renovation projects — particularly Miami Home Renovation Contractor Services and post-storm emergency repairs — create pressure to start work before paperwork is finalized. Every day of work performed before a Notice of Commencement is recorded and before downstream NTOs are served is a day of potential lien exposure or lien forfeiture, depending on which party is assessing risk.

Dispute resolution pathways for payment conflicts are documented under Miami Contractor Dispute Resolution.

Common Misconceptions

Misconception 1: A signed contract protects against lien claims by parties not on the contract.
Correction: Florida lien law extends rights to parties with no direct contract with the owner — any subcontractor or material supplier who files a timely NTO and records a valid Claim of Lien within 90 days of last furnishing can encumber the property regardless of what the owner-general contractor agreement states.

Misconception 2: Paying the general contractor in full eliminates all lien exposure.
Correction: Under § 713.06, an owner who pays the general contractor without receiving a Contractor's Final Payment Affidavit — which lists all unpaid subcontractors and suppliers — remains potentially liable for liens filed by those unpaid parties up to the amount of the final payment made.

Misconception 3: The homestead exemption blocks construction liens.
Correction: Florida's homestead protection under Article X, Section 4 of the Florida Constitution does not protect homestead property from liens for labor and materials furnished for improvements made with the owner's consent. The Florida Supreme Court has consistently held that construction liens survive homestead protection.

Misconception 4: Subcontractors have 90 days to serve a Notice to Owner.
Correction: The NTO deadline is 45 days from first furnishing — not 90 days. The 90-day figure applies to recording the Claim of Lien itself, a separate and later step. Conflating these two deadlines is among the most common errors leading to lien forfeiture.

Misconception 5: Unlicensed contractors retain full lien rights.
Correction: Florida courts have held that an unlicensed contractor who is required by statute to hold a license may be barred from enforcing a lien or contract claim. Proper licensing (see Hiring a Licensed Contractor in Miami) is a precondition for enforcing payment rights.

Checklist or Steps

Lien Rights Preservation — Sequential Actions by Party Type

Property Owner:
1. Record Notice of Commencement with Miami-Dade County Clerk before any work begins; post a certified copy at the jobsite.
2. Verify that the Notice of Commencement is publicly accessible via Miami-Dade County Official Records.
3. Collect Notices to Owner from all subcontractors and suppliers as they arrive; log each with the date of first furnishing listed.
4. Before each progress payment, request a partial lien waiver (conditional) from the contractor covering prior payment periods.
5. Before final payment, require the Contractor's Final Payment Affidavit (§ 713.06(3)(d)) listing all subcontractors and suppliers with their payment status.
6. Obtain conditional final lien waivers from all listed parties before releasing final payment.
7. Confirm no open Claims of Lien appear in Miami-Dade County records before closing out the project.

General Contractor:
1. Verify the owner has recorded a Notice of Commencement before mobilizing.
2. Collect NTOs from all first- and second-tier subcontractors within their 45-day window.
3. Apply owner payments to subcontractors within 30 days of receipt per § 713.346.
4. Record Claim of Lien within 90 days of last furnishing if payment is not received.
5. File a foreclosure action within 1 year of the Claim of Lien recording date to preserve enforcement rights.

Subcontractor / Supplier:
1. Identify the property owner and general contractor from the recorded Notice of Commencement on day 1 of furnishing.
2. Serve Notice to Owner on both the owner and the general contractor within 45 days of first furnishing.
3. Serve by certified mail or hand delivery; retain proof of service.
4. Record Claim of Lien within 90 days of last furnishing date.
5. For public jobs, serve notice on the payment bond surety within 90 days of last furnishing.

Further context on subcontractor structures and payment chains is available at Miami Subcontractor Relationships and the main Miami Contractor Services overview.

Reference Table or Matrix

Florida Construction Payment and Lien Deadlines — Miami-Dade Private Projects

References

• National Association of Home Builders (NAHB) — nahb.org
• U.S. Bureau of Labor Statistics, Occupational Outlook Handbook — bls.gov/ooh
• International Code Council (ICC) — iccsafe.org