CA AB880

Expands the California Prompt Payment Act's definition of "grant" to include signed agreements between state agencies and nonprofit organizations, and removes the previous $500,000 contract limit for nonprofits to receive late payment penalties

Raises the threshold for state agencies to dispute invoices based on delivery discrepancies, requiring the discrepancy to exceed $250 or 5% of the invoice amount (whichever is less) before it constitutes "reasonable cause" for dispute

Requires state agencies administering grant programs to reimburse grantees for indirect costs at one of four rates chosen by the grantee: their federally negotiated rate, the federal de minimis rate, an existing state rate, or a proposed rate for those without an existing state rate

Applies the indirect cost reimbursement requirements to all state-administered grant programs regardless of whether funding comes from state, federal, or combined sources

Mandates that state agencies report late payment penalties paid to nonprofit organizations separately in their annual reports to the Director of General Services