Legislative Report

Legislative Update -- October 12, 2026

One of the important Member benefits of joining CSDVB is the opportunity to meet with your Senator and Assembly Members, and the DGS regulators to have your voices heard. Meetings will be scheduled either in the District Offices or through a scheduled meeting in their Capitol during CSDVB’s Lobby Day and Networking Conference scheduled for mid-March (Date TBA). This is a Conference that you won’t want to miss! Stay tuned for more information.

The 2025-26 legislative session adjourned on August 31st with little fanfare. The deadline to send legislation to the Governor’s desk was on August 31st and the deadline for the Governor to take action on the bills landing on his desk was September 30th. The Legislature will reconvene on January 4, 2027 for the 2027-2028 Session.

As noted last month, CSDVB was successful in stalling Senate Bill 1044 (Reyes) that would have increased the maximum contract value from 250k to $350k for SB/DVBEs in the service and IT industries and would have authorized the DGS Director to increase the maximum any time there is a change to the Consumer Price Index. This bill was held in the Assembly’s Appropriations Committee and is dead for the year!

While SB 1044 was moving through the process, CSDVB secured amendments that would exempt SB/DVBEs who contract in the goods and supplies industries and keep the maximum at $250k. However, we pushed for additional amendments that would reduce the maximum for goods and supplies from the current $250k back down to the 2009 level of $100k maximum.

Following the increase to the $250k level, contracting opportunities for these two industries who contract for food and office/paper supplies, were significantly reduced along with their ability to compete with the larger businesses. The loss of these contracts have been permanent since the max. was raised to $250k.

CSDVB provided amendments that would have removed our opposition and put this bill into a shape that would work for all Certified Small and Disabled Veteran Businesses and their employees. The proposed amendments would have made the contract max. $100k for goods, including supplies since their contracts are nearly always in the $60-70k range.

As reported last month, the $350k contract max. will work for some SB/DVBEs and Microbusinesses (MB) but will have terrible consequences for the those who contract with the state for goods and supplies (food, paper products, office supplies, computers, plumbing, electrical supplies, etc.). The bill, as amended in the Assembly EDGHI Committee would keep the existing $250k contract maximum for goods and have $350k as the contract max. for Services and IT.

Most importantly, we can expect the same legislation introduced again in 2027 but with a different bill number. CSDVB will work hard to make sure that any revisions to the contract maximum will work for all SB/DVBEs, Women-Owned, Minority, Disadvantaged and LGBTQ Business Enterprises.

Below are the bills that are of interest to CSDVB’s Members including micro, small and disabled veteran enterprise businesses:

AB 685 (Solache, D) Small Business Development Technical Assistance.
Introduced: 02/14/2025
Last Amended: 08/21/2026
Status: 09/30/2026 - Approved by the Governor. Chaptered by Secretary of State - Chapter 824, Statutes of 2026.
Summary: Existing law establishes the California Small Business Technical Assistance Program (SB-TAP) within the Office of Small Business Advocate (OSBA), under the direct authority of the Small Business Advocate, for the purpose of assisting 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.

This bill would revise certain eligibility criteria for the small business technical assistance center grant programs, as specified. The bill would create uniform eligibility requirements for applicants with funding from a nonstate source. The bill would also authorize multiple small business technical assistance centers to apply as a network with a single fiscal agent if their active contracts are under the same funding authority. The bill would also require the OSBA to establish standardized performance metrics, reporting requirements, and outcome measures applicable to all grant recipients participating in the SB-TAP and would require the OSBA to monitor grant recipients during the grant performance period to ensure their compliance with SB-TAP requirements, as provided. The bill would include findings and declarations by the Legislature relating to the administration of the CIP and would require the OSBA to report its findings and actions and aggregate program outcomes to the Legislature.

AB 2116 (Schiavo, D) Commercial financing.
Current Text: 09/30/2026 - Chaptered
Introduced: 02/18/2026
Last Amended: 08/13/2026
Status: 09/30/2026 - Approved by the Governor. Chaptered by Secretary of State - Chapter 823, Statutes of 2026.
Summary: The California Financing Law (CFL) provides for the licensure and regulation of finance lenders and brokers by the Commissioner of Financial Protection and Innovation, including by regulating the provision of commercial loans, as defined. A willful violation of the CFL is a crime, except as specified. This bill would, beginning January 1, 2028, generally provide for the regulation under the CFL of commercial financing, which the bill would define to mean an accounts receivable purchase transaction, including factoring, asset-based lending transaction, commercial loan, commercial open-end credit plan, or lease financing, intended by the recipient for use primarily for a purpose other than a personal, family, or household purpose, as specified. Beginning July 1, 2028, the bill would prohibit a person from engaging in the business of a commercial financing provider, as defined, or a commercial financing broker, as defined, without obtaining a license from the commissioner, except as specified. The bill would impose various duties on commercial financing providers and commercial financing brokers.

SB 781 (Reyes, D) Small business.
Current Text: 07/14/2025 - Amended
Introduced: 02/21/2025
Last Amended: 07/14/2025
Status: 08/14/2026 - Failed Deadline pursuant to Rule 61(b)(14). (Last location was APPR. SUSPENSE FILE on 8/20/2025)
Location: 08/14/2026 - Assembly DEAD
Summary: Current law requires the Office of Small Business Advocate to, among other duties, collaborate with the Office of Small Business and Disabled Veteran Business Enterprise Services in their activities under the Small Business Procurement and Contract Act, including promoting small business certification.
This bill would require the advocate to also collaborate with local agencies on the development and implementation of local strategies to increase small business participation in local procurement opportunities. This bill would authorize a local agency, as defined, to establish a Small Business Utilization Program (SBUP) to increase small businesses’ participation in local agency procurement opportunities.
This bill would require an SBUP, to facilitate the participation of small businesses in the provision of goods, information technology, and services to the local agency, to establish a small business certification process. The bill would authorize a local agency that establishes an SBUP to engage in specified activities to facilitate contract awards to small businesses.

SB 1240 (McNerney, D) Office of Nonprofit Empowerment.
Current Text: 09/27/2026 - Vetoed
Introduced: 02/19/2026
Last Amended: 08/20/2026
Status: 09/27/2026 - Vetoed by the Governor. In Senate. Consideration of Governor's veto pending.
Location: 09/27/2026 - Senate VETOED
Summary: This bill would have created the Office of Nonprofit Empowerment within the Government Operations Agency with the primary responsibility of overseeing and coordinating state-level policies and strategies that support 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, in consultation with the appropriate control agency, for state entities on advance payment and other strategies to reduce hurdles for nonprofit organizations to access state funding and implement state projects, as specified.

SB 1044 (Reyes, D) Public contracts: Small Business Procurement and Contract Act.
Current Text: 06/24/2026 - Amended
Introduced: 02/11/2026
Last Amended: 06/24/2026
Status: 08/14/2026 - Failed Deadline pursuant to Rule 61(b)(14). (Last location was APPR. SUSPENSE FILE on 8/5/2026)
Location: 08/14/2026 - Assembly DEAD
Summary: The Small Business Procurement and Contract Act permits a state agency or the California State University to award a contract for goods, services, or information technology with an estimated value between $5,000 and $250,000 to a certified small business, including a microbusiness and a disabled veteran business enterprise, without complying with specified competitive bidding requirements. This bill would increase the maximum estimated value of a contract for services or information technology awarded pursuant to the act from $250,000 to $350,000.

AB 2272 (Caloza, D) State contracting: subcontractors: prompt payment.
Current Text: 08/27/2026 - Chaptered
Introduced: 02/19/2026
Last Amended: 04/16/2026
Status: 08/27/2026 - Approved by the Governor. Chaptered by Secretary of State - Chapter 139, Statutes of 2026.
Location: 08/27/2026 - Assembly CHAPTERED
Summary: The California Prompt Payment Act requires a state agency that acquires property or services pursuant to a contract with a business to make payment to the person or business on the date required by the contract and as specified, or be subject to a late payment penalty. Existing law requires state agencies to encourage claimants to promptly pay their subcontractors and suppliers, especially those that are small businesses. This bill would authorize a subcontractor or supplier performing work under a state contract to request payment status information from the awarding state agency regarding invoices submitted by the prime contractor, and would require a prime contractor to provide confirmation to the awarding agency, upon the agency’s request, regarding payments made to subcontractors.

Contact

Coalition of Small &
Disabled Veteran Businesses
P.O. Box 2576
Fresno CA 93745

Email

Phone

info@csdvb.online

(279) 284-4170

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