SB 781: Small business.
This bill aims to support small businesses in California by promoting their participation in local procurement opportunities. Local agencies can establish a small business utilization program to increase small businesses' involvement in local agency procurement opportunities. The program must establish a small business certification process, which includes a minimum goal of 25% procurement participation for small businesses to be certified. Local agencies can engage in activities to facilitate contract awards to small businesses, and they must submit information on their small business procurement participation to the Office of Small Business Advocate. The Office of Small Business Advocate will issue a data call to local agencies, requiring them to submit information on their progress toward meeting utilization goals. The Office of Small Business Advocate will prepare an annual report t…
| Aug. 29, 2025 | August 29 hearing: Held in committee and under submission. |
| Aug. 20, 2025 | August 20 set for first hearing. Placed on APPR. suspense file. |
| Aug. 20, 2025 | August 20 set for first hearing. Placed on APPR. suspense file. |
| Jul. 17, 2025 | From committee: Do pass and re-refer to Com. on APPR. with recommendation: To consent calendar. (Ayes 10. Noes 0.) (July 16). Re-referred to Com. on APPR. |
| Jul. 14, 2025 | Read second time and amended. Re-referred to Com. on L. GOV. |
| Amended IN Assembly July 14, 2025 |
| Amended IN Senate May 01, 2025 |
| Amended IN Senate March 26, 2025 |
| Introduced by Senator Reyes (Coauthors: Assembly Members |
February 21, 2025 |
LEGISLATIVE COUNSEL'S DIGEST
The people of the State of California do enact as follows:
SECTION 1.
Section 12098.3 of the Government Code is amended to read:12098.3.
(a) The Small Business Advocate shall be appointed by, and shall serve at the pleasure of, the Governor.(a)The California Small Business Technical Assistance Program is hereby created within the California Office of the Small Business Advocate.
(b)The program shall be under the direct authority of the Small Business Advocate.
(c)The purpose of the program is to assist small businesses through free or low-cost one-on-one consulting and low-cost training by entering into grant agreements with one or more small business technical assistance centers.
(d)In implementing the program, the office shall consult with local, regional, federal, and other state public and private entities that share a similar mission to support the needs of small businesses in California.
(e)An applicant pursuant to this article shall be a small business technical assistance center, including a regional or statewide network, operating as a group or as an individual center.
(1)A small business technical assistance center operating as a group consisting of centers organized under a coordinating administrative or fiscal entity shall apply by submitting a single consolidated application to the office.
(2)A small business technical assistance center operating as an individual center shall apply by submitting a single application for that center to the office.
(f)The office shall administer the program to provide grants to expand the capacity of small business development technical assistance centers in California, administered by and primarily funded by federal agencies, but shall also include other nonprofit small business technical assistance centers, that provide one-on-one confidential consulting and training to small businesses and entrepreneurs in this state. Except as modified by subdivision (l), an applicant shall be eligible to participate in the program if the office determines that the applicant meets all of the following criteria:
(1)At the time of applying for funds, the applicant has an active contract with a federal funding partner to administer a program in this state, or has received a letter of intent from a federal funding partner to administer a federal small business technical assistance center program in this state within the next fiscal year. Alternatively, if the applicant is not a federally contracted small business technical assistance center, the applicant shall document a private funding source with similar intent and meet the criteria defined in subdivision (s) of Section 12100.62.
(2)(A)The applicant provided a plan of action and commitment to fully draw down all of the federal funds available using local cash match and state funds not described in Section 12100.65 during the duration of the award period. Alternatively, if the applicant is not a federally contracted small business technical assistance center, the applicant shall present a plan of action for drawing down any match required by those private funding sources using local cash match outside of state funds not described in Section 12100.65 during the award period. The office may request that the applicant provide details relating to the source and amount of these nonstate local match funds.
(B)If the applicant is a new small business technical assistance center, the applicant has demonstrated the ability to fully draw down substantially all federal or private funds available to it.
(3)
The requested funding amount does not exceed the total federal award specified in the contract with the federal funding partner contract, or the private funding sources specified, but in any event is no less than twenty-five thousand dollars ($25,000).
(4)
The applicant seeks funding for one or more years, but no more than five years in duration.
(5)
The grant agreements authorized by this article are not subject to the model contract provisions developed pursuant to Chapter 14.27 (commencing with Section 67325) of Part 40 of Division 5 of Title 3 of the Education Code.
(6)
The applicant has a fiscal agent that is able to receive nonfederal funds.
(g)The office shall issue a request for proposal for grants under the program, which may contain the following information:
(1)The eligibility requirements described in subdivision (e).
(2)The available funding range.
(3)Funding instruments.
(4)The local cash match requirement described in subdivision (f).
(5)Operational capacity.
(6)The duration of the program.
(7)The start date of the program.
(8)Narrative requirements.
(9)Reporting requirements.
(10)Required attachments.
(11)Submission requirements.
(12)Application evaluation criteria.
(13)An announcement of an awards timeline.
(h)(1)The office shall evaluate applications received based on the following factors:
(A)The proposed use of the requested funding, including the specificity, measurability, and ability of the applicant to document and achieve the goals and objectives identified in its application.
(B)The proposed management strategy of the applicant to achieve its goals and objectives identified in its application.
(C)The applicant’s ability to complement and leverage the work of other local, state, federal, nonprofit, or private business technical assistance resource providers.
(D)The applicant’s historical performance with federal funding partner contracts or private funding sources and the strength of its fiscal controls.
(2)The office shall prioritize funding for applications that best meet the factors listed in paragraph (1) and give preference to applications that propose new or enhanced services to underserved business groups, including women, minority, and veteran-owned businesses, and businesses in low-wealth, rural, and disaster-impacted communities included in a state or federal emergency declaration or proclamation.
(i)State funds provided pursuant to the program shall be used to expand consulting and training services through existing and new centers, including satellite offices. State funds provided pursuant to the program shall not supplant nonstate local cash match dollars included in a federal small business technical assistance center’s plan described in subparagraph (A) of paragraph (2) of subdivision (f) or in any nonfederal small business technical assistance center’s plan.
(j)Subject to appropriation of necessary funds by the Legislature, a supplemental grant program designated as the California Dream Fund Program shall be established by the office to provide microgrants as described in this subdivision. The microgrants shall be disbursed through California Small Business Technical Assistance Program grantees. California Small Business Technical Assistance Program applicants, as prescribed by the office, may also request state funds designated as the California Dream Fund Program moneys to provide microgrants up to ten thousand dollars ($10,000) to seed entrepreneurship and small business creation in underserved small business groups that are facing capital and opportunity gaps. These microgrants shall be made available to startup clients participating in intensive startup training and consulting with the center networks.
(k)For purposes of implementing the California Dream Fund Program, a person or entity shall not seek information that is unnecessary to determine eligibility, including whether the individual is undocumented. Information that may be collected from individuals participating in the California Dream Fund Program shall not constitute a record subject to disclosure under Division 10 (commencing with Section 7920.000) of Title 1.
(l)For grants made in fiscal years 2025–26 through 2027–28, inclusive, the requirements in subdivision (f) are modified as follows:
(1)
An applicant may use its 2023–24 federal fiscal year contract to meet the requirement described in paragraph (1) of subdivision (f) to have an active contract with a federal funding partner to administer a program in this state.
(2)
The requirement described in paragraph (2) of subdivision (f) shall be waived for applicants who meet all of the following criteria:
(A)
The applicant received an award pursuant to this chapter as a federal small business technical assistance center during the 2022–23, 2023–24, and 2024–25 funding rounds.
(B)
The office determines the applicant successfully implemented their awarded contracts in 2023 and 2024.
(C)The applicant’s federal contract was canceled or otherwise rescinded in the 2024–25 fiscal year. This subparagraph shall not apply if the office determines the contract was canceled due to compliance issues.
(3)
An applicant may use the total contract award amount in its 2023–24 federal fiscal year contract to meet the requirement described in paragraph (3) of subdivision (f) that the requested funding amount made in a grant pursuant to this chapter not exceed the total federal award specified in the contract with the federal funding partner contract.
SEC. 2.
Section 12100.63 of the Government Code, as amended by Section 26 of Chapter 20 of the Statutes of 2025, is amended to read:12100.63.
(a) The California Small Business Technical Assistance Program is hereby created within the California Office of the Small Business Advocate.(2)(A)The applicant provided a plan of action and commitment to fully draw down all of the federal funds available using local cash match and state funds not described in Section 12100.65 during the duration of the award period. Alternatively, if the applicant is not a federally contracted small business technical assistance center, the applicant shall present a plan of action for drawing down any match required by those private funding sources using local cash match outside of state funds not described in Section 12100.65 during the award period. The office may request that the applicant provide details relating to the source and amount of these nonstate local match funds.
(B)If the applicant is a new small business technical assistance center, the applicant has demonstrated the ability to fully draw down substantially all federal or private funds available to it.
(3)
(4)
(5)
(6)