AB 442 — Revises provisions relating to grants. (BDR 31-589)

Section 14 of this bill makes this bill effective on July 1, 2026, and section 13 of this bill excludes from the requirements of this bill grants which are executed, renewed or extended before July 1, 2026.

- *AB442_R1* – 3 – THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

As used in sections 2 to 11,9, inclusive, of this act, unless the context otherwise requires, the words and terms defined in sections 3 to 7, inclusive, of this act have the meanings ascribed to them in those sections.

(a) Used to enter into a relationship for which the principal purpose is to transfer anything of value from the state grant- making entity to the private nonprofit corporation to carry out a public purpose authorized by law and not to acquire real property or services for the direct benefit or use of the state grant-making entity;

(d) A loan guarantee;

ortee;(f) State funding that is required annually and is calculated based on a formula set in statute;

(f)or State(g) fundingProceeds thatfrom is required annually and is calculated based on a formulageneral setobligation inbond. statute.

“Payment” includes all processing and authorization required by law from the State Board of Examiners, the Director of the Office of Finance and the State Controller.

the Director Sec.

“Private nonprofit corporation” means an organization that has been granted tax-exempt status by the Internal- Revenue83rd ServiceSession pursuant(2025) to– the3 provisions– of section 501(c)(3) of the Internal Revenue Code, 26 U.S.C.

“Proper invoice” means a bill, a request for reimbursement, a written document or an electronic submission - *AB442_R1* – 4 – readable by the state grant-making entity that is provided by a private nonprofit corporation and which:

Part 200.200 or any other state or federal law or regulation.

“State grant-making entity” means an agency, bureau, board, commission, department, division, officer or employee of the Executive Department of the State Government thatof makesHigher aEducation grant.or any institution of the Nevada System ofm Higher Education.

TheSecs. term does not include the Nevada System of Higher Education or any institution of the Nevada System of Higher Education.

Sec.8 and 8.5.

8.(Deleted by amendment.) Sec.

The Legislature declares that it is the policy of this State to:

1.

Make a payment under a grant agreement within 30 calendar days after receipt of a proper invoice.

2.

Make an advance of a grant to a private nonprofit corporation to facilitate the expeditious carrying out of the grant.

Sec.

8.5.

1.

The State Board of Examiners shall adopt policies and procedures pursuant to NRS 353.040 for carrying out the provisions of sections 2 to 11, inclusive, of this act.

2.

The policies and procedures adopted pursuant to subsection 1 must include, without limitation:

(a) A requirement that a summary of the provisions of sections 2 to 11, inclusive, of this act is included in each grant agreement into which a state grant-making entity enters with a private nonprofit corporation;

(b) The criteria for determining the amount of an advance pursuant to section 11 of this act;

and (c) The requirements for the reporting of interest earned on an advance made pursuant to section 11 of this act.

Sec.

ExceptIf as otherwise provided in subsection 3, a state grant-making entity shalldoes benot liablemake fora interestpayment onfor anyan amount that is due and payable by law under a written grant agreement with a private nonprofit corporation atwithin a30 ratecalendar thatdays hasafter beenreceipt agreedof upona inproper invoice, the grantstate agreementgrant-making or,entity ifshall, aas ratesoon hasas notpracticable beenafter sothat agreed30-day upon,period, theprovide ratewritten equalnotice to the primeprivate ratenonprofit atcorporation the largest bank in this State, as determined by the Commissioner of Financial Institutions on January 1 or July 1, based on the datereason onfor which the writtendelay grantin agreementmaking was signed by the parties.payment.

InterestOn foror whichbefore aOctober 1 of each year, the state grant-makinggrant- making entity isshall liablesubmit pursuant to thisthe sectionDirector mustof accruethe beginningOffice onof Finance and the 31stDirector -of *AB442_R1*the –Legislative 5Counsel –Bureau calendarfor daytransmittal afterto the dateInterim onFinance whichCommittee a compilation of the statenotices grant-makingprovided entitypursuant receivesto asubsection proper1 invoice.during the immediately preSecs.

3.10 and 11.

A(Deleted stateby grant-makingamendment.) entitySec. is not liable for interest pursuant to this section:

(a)11.3. Unless the private nonprofit corporation submits an invoice for the interest within 30 calendar days after receiving payment for the amount on which the interest accrued;

(b)Chapter If223 theof stateNRS grant-makingis entityhereby hasamended initiatedby legaladding proceedingsthereto toa disputenew thesection amount owed to theread privateas nonprofitfollows: corporation;

(c) Accruing more than 1 year after the 31st calendar day after the state grant-making entity receives a proper invoice;

(d) On an amount that represents unpaid interest;

(e) If the delay in payment is the result of technical problems relating to the operation of the electronic payment system of the state or federal grant-making entity, the closure of the office of the state grant-making entity on a day declared to be a legal holiday pursuant to NRS 236.015, extreme weather or another extraordinary event;

or (f) If the state grant-making entity does not have sufficient budgetary authority or a sufficient cash balance to process the payment.

4.

Interest for which a state grant-making entity is liable pursuant to this section:

(a) Must be paid from the operating budget of the state grant- making entity;

and (b) May not be paid from money appropriated to provide money for a grant.

5.

For the purposes of determining the due date of a payment and the date on which interest begins to accrue, an invoice is deemed to be received:

(a) For invoices that are mailed, when a proper invoice is received by the state grant-making entity, as of the date on which the state grant-making entity annotates the invoice with the date and time of receipt;

or (b) For invoices that are transmitted electronically, on the date on which the transmission is received by the state grant-making entity or, if the transmission is received after 5 p.m.

on that date, the next business day.

6.

If a state grant-making entity does not make a payment for an amount that is due and payable by law under a written grant agreement with a private nonprofit corporation within 30 calendar days after receipt of a proper invoice because of circumstances described in subsection 3, the state grant-making entity shall, as soon as practicable after that 30-day period:

- *AB442_R1* – 6 – (a) Provide written notice to the private nonprofit corporation of the reason for the delay in making the payment;

and (b) Make a written record of the delayed payment, including, without limitation:

(1) The date on which the state grant-making entity received a proper invoice for the payment;

(2) The reason for the delay by the state grant-making entity in making the payment;

and (3) If applicable, the date on which the payment was made.

7.

On or before October 1 of each year, the state grant- making entity shall submit to the Director of the Office of Finance a compilation of the records made by the state grant-making entity pursuant to paragraph (b) of subsection 6 during the immediately preceding fiscal year.

Sec.

10.

UponThe receiptOffice ofmay ancoordinate invoice,and acollaborate with state grant-making entityentities shall:to identify:

(a) MarkExisting thepolicies invoiceand withprocedures theutilized dateby onstate whichgrant- themaking invoiceentities wasto received;administer advanced payments of grants;

and- (b)83rd ReviewSession the(2025) invoice– as4 soon– asassociated practicablewith toadministration determineof whetheradvanced thepayments invoiceof isgrants; a proper invoice.

and (c) Methods for state grant-making entities to comply with 2 C.F.R.

Part 200 and any other federal regulations governing the administration of grants.

IfThe theDirector statemay grant-makingadopt entityregulations determinesto thatcarry out the invoice:provisions of this section.

(a) Is a proper invoice, the state grant-making entity shall submit the invoice for payment in the same manner as other claims against the State are paid.

(b) Is not a proper invoice, within 14 calendar days after making such a determination, the state grant-making entity shall notify the private nonprofit corporation of all defects that prevent the invoice from being determined to be a proper invoice.

A private nonprofit corporation that receives such a notification may submit a corrected invoice.

AAs stateused grant-makingin entitythis maysection, use“state mediagrant-making thatentity” producehas tangiblethe recordingsmeaning ofascribed information to expediteit the payment process in lieusection 7 of requiringthis originalact. paper documents.

4.

Failure by a state grant-making entity to comply with the procedural requirements of this section does not constitute a late payment.

11.11.5.

1.NRS 223.460 is hereby amended to read as follows:

A223.460 privateAs nonprofitused corporationin mayNRS submit223.460 to a223.498, stateinclusive, grant-makingand entity,section on11.3 aof formthis prescribedact, byunless the Directorcontext ofotherwise requires, the Officewords ofand Finance,terms adefined requestin forNRS an223.462 advanceto from223.470, theinclusive, granthave thatthe wasmeanings awardedascribed to thethem privatein nonprofitthose corporationsections. by the state grant-making entity.

Sec.

11.7.

NRS 223.486 is hereby amended to read as follows:

223.486 1.

The Director shall, in consultation with the 358.020, develop and may periodically revise a State Plan for Maximizing Federal Assistance, which must identify:

(a) Methods for expanding opportunities for obtaining federal assistance, including, without limitation, expanding opportunities for obtaining matching funds for federal assistance through the Nevada Grant Matching Program created by NRS 223.490;

(b) Methods for streamlining process, regulatory, structural and other barriers to the acquisition of federal assistance that exist at each level of federal, state or local government;

(c) Methods for the effective administration of grants, including, without limitation, the administration of advanced payments of grants to private nonprofit corporations and best practices relating to indirect cost allocation;

(d) Opportunities for:

(1) Reducing administrative costs associated with obtaining federa(2) Coordination between state agencies, local agencies, tribal governments and nonprofit organizations to avoid duplication and achieve common goals;

(e) Specific tasks which must be performed to improve the administration of grants and maximize the amount of federal assistance received by this State and a schedule for implementing any such tasks;

- 83rd Session (2025) – 5 – maximizing federal assistance and improving the administration of grants;

and (g) Best practices for considering whether to respond to a grant opportunity, including, without limitation, the monetary and programmatic cost of implementing a grant.

The privateDirector nonprofitshall corporationpost must include with the formState submittedPlan pursuantfor toMaximizing subsectionFederal 1Assistance aon plan for expenditure of the advanceInternet whichwebsite must,maintained withoutby limitation:the Office.

- *AB442_R1* – 7 – (a) Align with the eligible activities and expenditures under the grant;

(b) Provide the justification for the advance;

and (c) Describe the financial management policies that the private nonprofit corporation has established to monitor expenditure of the advance.

3.

As a condition to receipt of an advance pursuant to this section, a private nonprofit corporation must agree to:

(a) Transmit a report on the expenditure of the advance in the manner required by the state grant-making entity, which includes, without limitation, a summary of the work completed and proof of expenditures.

(b) Return to the state grant-making entity any money from the advance that was not expended within the timeline for expenditure of the advance or for the eligible activities specified in the grant agreement between the private nonprofit corporation and state grant-making entity or receive a reduced amount for the immediately succeeding payment under the grant in an amount equivalent to the unexpended amount of the advance.

(c) Deposit the advance in a federally insured account that provides the ability to track the interest earned on money in the account and any withdrawal from the account.

The account must be opened in the name of the private nonprofit corporation and not in the name of any director or officer of the private nonprofit corporation.

(d) Report any interest earned on the advance deposited in an account described in paragraph (c) in accordance with the policies and procedures adopted pursuant to section 8.5 of this act.

If the source of funding for the grant is money from the Federal Government, the private nonprofit corporation must return any such interest payments to the state grant-making entity.

4.

The private nonprofit corporation must submit any additional information requested by the state grant-making entity, including, without limitation, any information that is necessary for the state grant-making entity to perform effectively risk assessment and monitoring of recipients of subgrants from the grant.

5.

An advance pursuant to this section:

(a) Unless prohibited by federal law or contractual agreement:

(1) May be approved by the state grant-making entity if the state grant-making entity:

(I) Determines that the private nonprofit corporation has demonstrated sufficient justification for the advance and does not pose any undue risk to the state grant-making entity;

- *AB442_R1* – 8 – (II) Determines that providing an advance does not create an unreasonable administrative burden on or financial risk to the state grant-making entity;

and (III) If applicable, has verified compliance by any recipients of subgrants from the grant with the grant agreement and applicable law.

(2) Is limited to:

(I) If the source of funding for the grant is money from the State Government, the amount requested by the private nonprofit corporation, but not to exceed 25 percent of the amount of the grant award;

or (II) If the source of funding for the grant is money from the Federal Government, the minimum amount to cover the immediate cash requirements of the private nonprofit corporation in carrying out the purpose of the grant in accordance with 2 C.F.R.

Part 200.

(b) May not be approved by the state grant-making entity if the state grant-making entity does not have sufficient budgetary authority or a sufficient cash balance to pay the advance.

6.

A state grant-making entity that approves an advance pursuant to subsection 5 shall provide written notice of the advance to the Director of the Office of Finance.

7.

The requirements and penalties set forth in the grant agreement apply to the use of the advance.

8.

On or before October 1 of each year, the Director of the Office of Finance shall submit a report to the Interim Finance Committee concerning the advances for which the Director was provided notice pursuant to subsection 6 during the immediately preceding fiscal year.

H~~~~~ 25 - *AB442_R1*83rd Session (2025)