Committee hears wide-ranging testimony in support of A4692, a bill to streamline state contracting with nonprofits

The Assembly committee held an extended, discussion-only hearing on A4692, a bill sponsored by Assemblywoman Yvonne Lopez that seeks to reform how the state contracts with nonprofit organizations. Dozens of nonprofit leaders, trade groups and community organizations testified in support, describing repeated administrative burdens, delayed payments and funding shortfalls that they said undermine service delivery.

What the bill would do: Witnesses described several key provisions in A4692 as drafted: require a central repository for frequently filed documents; provide a de minimis indirect cost rate of 15 percent for grants and contracts; require periodic inflation adjustments (CPI indexing) for awards; and create incentives for timely payments and options for advanced or up-front payments in some programs.

Voices at the hearing: Linda Zippo, president and CEO of the New Jersey Center for Nonprofits, said the state’s nonprofit sector is large and economically significant and summarized survey data showing common contract problems. “Contracts not covering the cost of services was a problem,” she told the committee, citing a recent rapid-response survey in which roughly four in five respondents reported inadequate contract coverage for service costs.

Laura Festeroff Chad, managing director at Isles in Trenton, described operational cash-flow impacts and told the committee her organization was carrying “just under a million dollars of expenses that we’ve incurred that have not been reimbursed at this point in time,” including $530,000 outstanding over 30 days and another $460,000 not yet eligible for submission because contracts were not finalized.

Marissa Davis, vice president of the New Jersey YMCA State Alliance, described duplicative reporting across multiple grant portals and a concrete example where a contract’s accounting entries produced a $500 overage that state staff later said would be reclaimed—an unpredictable outcome for local branches that must manage tight budgets.

Other witnesses included Sharon Levine of The Arc of New Jersey, Rosie Grant of Patterson Education Fund, Rosalina Melendez of La Casa Don Pedro, Chris Tramiel representing NJBIA, Raquel Romans Henry of Salvation and Social Justice, and several dozen additional organizations who filed slips in favor and provided oral testimony during the hearing.

Common themes and clarifications: Testimony repeatedly emphasized four operational pain points: (1) late payments that force nonprofits to use lines of credit and pay interest; (2) a patchwork of portals and duplicative document uploads across agencies; (3) stagnant contract values that have not kept pace with inflation; and (4) restricted indirect-cost allowances that do not cover real administrative overhead. Several speakers asked the committee to require award documents be issued within 30 days of the award announcement and to make advance payments automatic where the statute permits.

Committee discussion: Committee members expressed appreciation for the testimony and described personal experience with nonprofit operations and red tape; the chair thanked witnesses and indicated the committee would continue consideration. A4692 was taken up as a “discussion only” item and was not voted on during the session.

Ending: The chair closed the hearing after several hours of testimony and remarks and adjourned the committee. The bill remains in committee for further action.

Votes at a glance: A4692 — discussion only (no committee vote recorded).