Office of Nonprofit Empowerment., the official text

An act to add and repeal Section 12818 of the Government Code, relating to state government.

LEGISLATIVE COUNSEL'S DIGEST

Existing law contains numerous provisions authorizing state agencies to award grants or contracts to nonprofit organizations to carry out various services and programs. Existing law authorizes a state agency that administers a grant program or contract to advance funds to a private nonprofit organization to which it has awarded a grant or contract, subject to certain limitations and requirements, as specified.
This bill would create the Office of Nonprofit Empowerment with the primary responsibility of overseeing and coordinating state policy in support of California’s nonprofit organizations. The bill would specify various duties and functions of the office, including providing guidance, resources, and technical assistance to nonprofit organizations on procurement and grantmaking laws, regulations, and best practices. The bill would also require the office to develop and administer training and materials to state entities on advance payment and other strategies to reduce hurdles for nonprofit organizations to access state funding and implement state projects, as specified. The bill would authorize the office to update the State Administrative Manual and State Contracting Manual, as specified. The bill would establish the office within the state government, would place the office under the control of a director who would be appointed by the Governor, and would require the director to hire staff to assist in the fulfillment of its duties and responsibilities. The bill would also require the office to post on its internet website, on or before July 1, 2028, ways to improve how nonprofits and the state partner, as specified. The bill would repeal these provisions on January 1, 2037. The bill would include related legislative findings and declarations.

The people of the State of California do enact as follows:

SECTION 1.
The Legislature finds and declares both of the following:
(a) Nonprofit organizations are critical to the well-being of California’s communities, providing essential services and programs in the areas of education, health care, social services, the arts, natural resources, the environment, public safety, and more.
(b) The creation of a centralized voice for nonprofits in state government is necessary to foster collaboration and partnership between the two sectors, to improve access to resources and technical assistance for nonprofits for the ultimate benefit of program recipients, and to ensure more equity and fairness in service delivery and payment for those services.

SEC. 2.
Section 12818 is added to the Government Code, to read:
12818.
(a) Upon appropriation of the Legislature, the Office of Nonprofit Empowerment is hereby established within the state government, with the primary responsibility of overseeing and coordinating state-level policies and strategies that support California’s nonprofit organizations.
(b) A director of the Office of Nonprofit Empowerment shall be appointed by, and serve at the pleasure of, the Governor. The director shall be responsible for managing the affairs of the office and shall perform all duties, exercise all powers and jurisdiction, and assume and discharge all responsibilities necessary to carry out the purposes of this section.
(c) For the purposes of this section:
(1) “Director” means the Director of the Office of Nonprofit Empowerment.
(2) “Nonprofit organization” means an organization that qualifies as an exempt organization under Section 501(c)(3) of the Internal Revenue Code or under Section 23701d of the Revenue and Taxation Code.
(3) “Office” means the Office of Nonprofit Empowerment.
(4) “State entity” means an entity within the executive branch that is under the direct authority of the Governor, including, but not limited to, all departments, boards, bureaus, commissions, councils, and agencies.
(d) The duties and functions of the office shall include all of the following:
(1) Serve as the principal advocate and centralized point of contact in the state for nonprofit organizations and foster partnerships and collaboration between nonprofit organizations and state entities.
(2) Provide guidance, resources, and technical assistance to nonprofit organizations on procurement and grantmaking laws, regulations, and best practices.
(3) Conduct research and make policy recommendations on innovative best practices to promote greater accountability, efficiency, equity, and fairness in procurement and grantmaking processes and requirements, with a focus on reducing barriers for small grants, small nonprofits, and nonprofits working with disadvantaged, low-income, and underresourced communities.
(4) Develop and administer training and materials to state entities on advance payment as provided in Section 11019.3 and any other federal, state, or local law, and other strategies to reduce hurdles for nonprofit organizations to accessing state funding and implementing state projects while maintaining accountability to taxpayers.
(5) Strengthen coordination and alignment across state entities that have regular touchpoints with nonprofit organizations, especially during declared emergencies.
(6) Assist nonprofit organizations in identifying and applying for available state grants, funding opportunities, and technical assistance.
(7) Advocate to ensure that the nonprofit sector is properly represented in state policymaking, including by representing the views and interests of nonprofit organizations before other state entities whose policies and activities may impact nonprofit institutions.
(8) In implementing paragraphs (1) to (7), inclusive, regularly consult with nonprofit organizations and experts to ensure efforts are informed by the needs of nonprofit organizations.
(e) The director shall hire staff to assist in the fulfillment of the duties and responsibilities of the office.
(f) The office may create, update, or publish, in consultation with the appropriate control agency, policies, standards, and procedures for state entities in the State Administrative Manual or State Contracting Manual.
(g) The office may, subject to available resources and consistent with applicable laws and regulations, contract and consult with nonprofit organizations, external entities, and vendors to develop training, curricula, and other resources as determined appropriate by the office.
(h) On or before July 1, 2028, the office shall post on its internet website opportunities to improve the ways nonprofits and the state partner together while maintaining accountability to Californians and public resources. After the initial posting, the office shall review and update the information on the internet website regularly to ensure the contents remain current and reflective of evolving best practices. This internet website shall include, but not be limited to, policy recommendations, potential statutory and regulatory changes, and promising administrative best practices related to all of the following:
(1) Efforts to further encourage and expand use of advance payments.
(2) Mechanisms to reflect and compensate nonprofits for the true cost of doing business in contracts and grant programs.
(3) Reforms to ensure equitable, fair, and prompt payment to nonprofit institutions.
(4) Opportunities for greater consistency in grantmaking processes, application, and reporting across state entities.
(5) Other strategies to reduce complexity and barriers for nonprofits to enter into and implement contracts and grants with the State of California, with a focus on small grant programs, small nonprofits, and nonprofit institutions serving historically marginalized communities.
(6) Facilitate communication and coordination with nonprofit organizations during emergencies.
(i) This section shall remain in effect only until January 1, 2037, and as of that date is repealed.