SB 1246: California Prompt Payment Act: nonprofit organizations.

The California Prompt Payment Act requires a state agency that awards a grant or that acquires property or services pursuant to a contract to make timely payments pursuant to the grant or contract. The act requires, to avoid late payment penalties, a state agency to make payment within 45 days of the receipt of an undisputed invoice, as prescribed. The act provides an exception from those penalty provisions if the grant or contract was awarded to a nonprofit organization in an amount less than $500,000. The act defines the term grant to mean a signed final agreement between any state agency and a local government agency or organization authorized to accept grant funding for victim services or prevention programs administered by any state agency or restoration activities performed by a resource conservation district.

This bill would delete the definition of the term grant from the act and would delete the $500,000 exception described above. The bill would provide that only specified late payment penalties apply to a signed final agreement for a grant as described in the above-paragraph or a grant by any state agency to a nonprofit organization.