West Sacramento, Calif. — Rural Community Assistance Corporation (RCAC) urges the California State Senate to approve Sen. Tom Umberg’s Senate Bill 1069 (SB 1069). This bill harmonizes California’s Government Code with federal guidelines that require nonprofits with government grants to receive indirect cost reimbursement, thus ensuring a more efficient and equitable partnership with the state for essential services. RCAC and Self-Help Enterprises sponsored SB 1069 and led efforts to pass the bill through the legislature.

During an unprecedented health crisis, nonprofit organizations faced sweeping challenges. When COVID-19 struck, nonprofit staff provided vital resources and support to the most affected and least served. As state and local governments cut back on social spending, nonprofits stepped up to provide food, healthcare access and housing assistance to Californians in need.

Nonprofits play a key role in providing services to the most vulnerable, yet the state fails to compensate them adequately for their total costs.  Unlike the federal government, California does not offer uniform reimbursement rates for indirect costs that nonprofits incur. Therefore, nonprofits that partner directly with the state must subsidize expenses, such as accounting, technology infrastructure, construction and utilities, supplies and related costs. This inconsistency hinders nonprofits’ ability to protect public health and advance statewide legislative priorities that meet the needs of disadvantaged Californians.

In April, SB 1069 passed the Senate Governmental Organization Committee with unanimous support, and it is currently in the Senate Appropriations Committee Suspense File. Bills that require significant funding are referred to suspense to await a biannual hearing where the committee decides which bills in the file move on to debate. RCAC urges Senate Appropriations Chairman Anthony Portantino to remove the bill from suspense and place it back onto the Senate floor for a vote. While the Bipartisan Infrastructure Law provides much-needed relief to our communities, the California State Senate must pass SB 1069 to ensure that nonprofits remain viable and able to serve our most vulnerable residents.

Founded in 1978, RCAC provides training, technical and financial resources and advocacy so rural communities can achieve their goals and visions. RCAC serves rural communities in 13 western states and western Pacific islands. Services are available to communities with populations of fewer than 50,000, other nonprofit groups, Tribal organizations, farmworkers, colonias and other specific populations. RCAC staff provides direct services in program areas including affordable housing, environmental services, economic development and lending. To learn more about RCAC, visit http://www.rcac.org

Media contact:

Ari Neumann, director
Community & Environmental Services
(916) 588-0112 (cell)