Assembly Bill 2322 (Hart and Bennett) – Public Contracts: Nonprofit Organizations Support

On behalf of the undersigned organizations, we write to express our strong support for your Assembly Bill 2322, which will support the state’s equity and access goals by reducing the effort and expense associated with very small state contracts and grants to nonprofits, including when they are administered by a third party. We are thrilled that you have picked up the mantle of similar legislation (AB 860) that advanced through the Assembly and through the Senate Government Organization committee unanimously last year.

The size of state grants and contracts vary significantly. Opportunities currently listed on the state’s grants portal – grants.ca.gov – include grants as large as $22 million and as small as $320. Using the same application, qualifications, and reporting processes for both large and small grants and contracts is unnecessary and expensive. 

VaccinateAll58 – an outreach program from the California Department of Public Health – offers an example of a step in the right direction. The agency made dozens of outreach grants of $5,000 or less to both small and large nonprofits, utilizing a simplified application. The final report was likewise simplified, requiring no more than 1,100 words in narrative, and requiring no receipts to be submitted to justify expenses. While not appropriate for large grants and contracts, this process was efficient, and appropriate for small contracts, and resulted in a more equity-oriented pool of grant recipients. 

AB 2322 will save the state money because: 

• Simplifying the paperwork for small, one-time grants will save substantial administrative time without significant loss of accountability. 
• Simpler processes will save third-party grant administrators significant time, lowering the cost to the state for contracts with those parties. 
• Reporting will be less burdensome and time-consuming for the state and nonprofits, reducing delay associated with routine requirements to include receipts for small expenditures associated with small grants. 

AB 2322 strengthens the state’s partnership with nonprofits and thus increases positive outcomes and service to Californians by: 

• Making small grants and contracts more feasible for nonprofits to manage through lower administrative burden. 
• Creating more access for a broader pool of community-based organizations to receive and utilize state grants and contracts to reach hard-to-reach populations. 

This bill is part of the California Nonprofit Equity Initiative that our organizations, along with more than 500 other nonprofit and community leaders, are supporting to level the playing field for nonprofits. Improving how state government contracts with nonprofits is a question of equity for our most vulnerable communities and for the nonprofits that serve them. Nonprofits are a powerful force for equity. 

Aligned with the Governor’s “California for All” vision, AB 2322 responds to the impact the pandemic has had on our communities, the need to address inequity and inequality in access to state resources, and the imperative to support strong and varied community-based organizations to address increased need. Passing AB 2322 and the rest of the California Nonprofit Equity Initiative will strengthen the essential partnership between the state and nonprofits and our mutual efforts to deliver the highest quality services to the people of California.

AB 2322 brilliantly illustrates how to build equity into the grants and contracting processes. Thank you for being part of the collaborative effort to pursue meaningful improvements aimed at improving the state’s relationship with its nonprofit partners.

We strongly support AB 2322 and thank you for championing this legislation.

Sincerely, 

The California Coalition on Government Contracting