H 233

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1H.233
2 Introduced by Representatives Nugent of South Burlington, Brown of
3Richmond, Carris-Duncan of Whitingham, Cina of Burlington,
4Cole of Hartford, Hooper of Burlington, Krasnow of South
5Burlington, Lalley of Shelburne, Logan of Burlington, McGill
6of Bridport, Minier of South Burlington, Mrowicki of Putney,
7Olson of Starksboro, Pouech of Hinesburg, Priestley of
8Bradford, Rachelson of Burlington, Torre of Moretown, and
9Waszazak of Barre City
10 Referred to Committee on
11 Date:
12 Subject: Executive; grants; funding; prompt execution and payment
13 Statement of purpose of bill as introduced: This bill proposes to require the
14 Secretary of Administration to update Administrative Bulletin 5 to include a
15 process for nonprofits to use an indirect rate higher than the de minimis rate
16 and to require a State agency issuing a grant to promptly execute the grant and
17 to promptly pay expenses on the grant submitted by an organization.
18    An act relating to requirements for State-funded grants
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1 It is hereby enacted by the General Assembly of the State of Vermont:
2 Sec. 1. GRANT APPLICATIONS AND AGREEMENTS; INDIRECT
3RATES FOR NONPROFITS; BULLETIN 5
4    On or before July 1, 2025, the Secretary of Administration shall include in
5 Administrative Bulletin 5, Policy for Grant Issuance and Monitoring, a
6 uniform formula and approval process for use in all State-funded grants for
7 nonprofit corporations to use an indirect rate higher than the standard de
8 minimis rate, pursuant to 2 C.F.R. § 200.332(b)(4).
9 Sec. 2. PROMPT EXECUTION OF GRANT AGREEMENTS AND
10PROMPT PAYMENT OF GRANT FUNDS; REPORTING;
11BULLETIN UPDATE
12    (a) Execution of grant agreements.
13(1) A State agency shall execute a State-funded grant agreement with an
14 organization not later than 30 days after:
15(A) funds are appropriated in the budget to the agency for the
16 purposes of a grant agreement between the agency and organization; or
17(B) notice, either written or verbal, of an award of a State-funded
18 grant is provided by the granting agency to the organization.
19(2) If a granting agency is unable to execute a State-funded grant
20 agreement pursuant to the terms set forth in subdivision (1) of this subsection,
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1 the granting agency shall submit in writing an explanation to the Agency of
2 Administration as to why it was unable to meet its obligation.
3    (b) Prompt payment.
4(1) For all executed State-funded grant agreements, the granting agency
5 shall pay the grantee within 30 days after receipt of a valid written request for
6 payment from the grantee. A written request for payment from the grantee is
7 valid if it meets the requirements in the executed grant agreement between the
8 granting agency and grantee.
9(2) If a granting agency is unable to promptly pay the grantee of a State-
10 funded grant agreement pursuant to the terms set forth in subdivision (1) of this
11 subsection, the granting agency shall submit in writing an explanation to the
12 Agency of Administration as to why it was unable to meet its obligation.
13    (c) Reporting. The Agency of Administration shall:
14(1) create an online form on its website where grantees awarded State-
15 funded grants are able to provide notice that a granting agency did not timely:
16(A) execute a State-funded grant agreement pursuant to subdivision
17 (a)(1) of this section; or
18(B) pay the grantee upon receiving a valid written request for
19 payment pursuant to subdivision (b)(1) of this section; and
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1(2) create a publicly accessible database on its website that displays all
2 nonconfidential information submitted by grantees pursuant to subdivision (1)
3 of this subsection.
4    (d) Update bulletin. On or before July 1, 2025, the Secretary of
5 Administration shall update Administrative Bulletin 5, Policy for Grant
6 Issuance and Monitoring, with the language provided in this section.
7 Sec. 3. WORKING GROUP ON STATE GRANT PROCESSES
8    (a) Creation. There is created the Working Group on State Grant Processes
9 for the purpose of assessing the State’s current grant awarding procedures.
10    (b) Membership. The Working Group shall be composed of the following
11 members:
12(1) the Secretary of Administration or designee;
13(2) one representative of Common Good Vermont, selected by the
14 Director of Common Good Vermont;
15(3) two representatives, each of different nonprofit organizations,
16 selected by the Director of Common Good Vermont, who have received a
17 State-funded grant within 12 months of July 1, 2025;
18(4) one member of the Vermont House of Representatives, appointed by
19 the Speaker of the House;
20(5) one member of the Vermont Senate, appointed by the Senate
21 Committee on Committees; and
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1(6) one representative of the Department of Finance and Management,
2 appointed by the Governor.
3    (c) Meetings.
4(1) The Secretary of Administration or designee shall call the first
5 meeting of the Working Group to occur on or before September 1, 2025.
6(2) The Working Group shall select a chair from among its members at
7 the first meeting.
8(3) A majority of the membership shall constitute a quorum.
9(4) The Working Group shall meet not fewer than eight times.
10(5) The Chair may establish subcommittees to perform the work set
11 forth in this section.
12    (d) Powers and duties. The Working Group shall:
13(1) assess the State’s current grant and contracting funding levels and
14 determine whether the State should review cost of living or other inflationary
15 adjustments on a regular basis;
16(2) assess, due to delayed reimbursement from granting agencies, how
17 the need to obtain bridge loans and lines of credit have impacted nonprofits
18 and their ability to provide services to the State;
19(3) assess the grant and contracting processes of the Agency of Human
20 Services to identify best practices and areas needing improvement;
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1(4) determine how to increase the number of State-funded grants that do
2 not require reimbursement;
3(5) recommend solutions to improve reimbursement practices and
4 processes of State-funded grants;
5(6) identify system improvements that would simplify the State-funded
6 grant application and reporting processes;
7(7) examine ways to ensure consistency between State and federal
8 indirect rates, including:
9(A) reviewing the process for nonprofit organizations to qualify for
10 an indirect rate above the standard rate; and
11(B) honoring federal indirect rates;
12(8) analyze the impact of State-funded grants being executed more than
13 30 days after a notice of award is issued;
14(9) analyze the impact of agencies not paying grantees within 30 days
15 after receiving a written request for payment on a grant; and
16(10) consider related issues that arise during the course of the Working
17 Group’s duties as set forth in this section.
18    (e) Assistance. The Working Group shall have the administrative and
19 technical assistance of the Joint Fiscal Office and the administrative, legal, and
20 technical assistance of the Agency of Administration.
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1   (f) Reporting. The Working Group shall submit a written report to the
2 House Committee on Government Operations and Military Affairs and the
3 Senate Committee on Government Operations with its recommendations based
4 on the analysis conducted pursuant to this section on or before September 1,
5 2026.
6   (g) Compensation and reimbursement.
7(1) For attendance at meetings during adjournment of the General
8 Assembly, a legislative member of the Working Group serving in the
9 member’s capacity as a legislator shall be entitled to per diem compensation
10 and reimbursement of expenses pursuant to 2 V.S.A. § 23 for not more than
11 eight meetings.
12(2) Other members of the Working Group shall be entitled to per diem
13 compensation and reimbursement of expenses as permitted under 32 V.S.A.
14 § 1010 for not more than eight meetings.
15(3) Payments to members of the Working Group authorized under this
16 subsection shall be made from monies appropriated to the General Assembly.
17   (h) Expiration. The Working Group shall cease to exist on December 31,
18 2026.
19 Sec. 4. EFFECTIVE DATE
20   This act shall take effect on July 1, 2025.
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