CA AB1039

Requires state agencies to advance payments to nonprofit organizations and federally recognized California tribes for all grants and contracts advertised on or after January 1, 2026, rather than making such payments optional

Limits the prioritization requirement for recipient entities serving disadvantaged, low-income, and under-resourced communities to grants and contracts advertised before January 1, 2026

Requires grant and contract solicitations to state the percentage of funds that may be distributed as an advance payment, with this information also submitted to the California State Library's grant registry

Eliminates the requirement to stipulate advance payment structures in grant agreements and instead directs agencies to consider utilizing best practices from the Strategic Growth Council's Community Assistance for Climate Equity (CACE) program

Limits the federally insured account requirement for advance payment deposits to grants and contracts exceeding $10,000