AB 1039: State-funded assistance grants and contracts: advance payments.

The bill aims to modify state-funded assistance grants and contracts by advancing payments to recipient entities. Prioritization of disadvantaged communities will only be required for grants and contracts advertised before January 1, 2026. The requirement for advance payment structures and request processes will be eliminated, and agencies will instead consider best practices for advance payments. The federally insured account requirement will only apply to grants exceeding $10,000. A state agency can now advance payments to recipient entities for all grants and contracts advertised on or after January 1, 2026. The solicitation for grants and contracts must state the percentage of funds that may be distributed as an advance payment. State agencies will also be required to include this information in the grant information submitted to the California state library.