EXEMPT
(Reprinted with amendments adopted on April 18, 2025)
FIRST REPRINT A.B. 442
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ASSEMBLY BILL NO. 442–ASSEMBLYMEMBERS WATTS, NGUYEN,
MOSCA, BROWN-MAY; D’SILVA, GALLANT, O’NEILL AND ROTH
MARCH 17, 2025
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JOINT SPONSORS: SENATORS NGUYEN, FLORES; AND STONE
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Referred to Committee on Government Affairs
SUMMARY—Revises provisions relating to grants. (BDR 31-589)
FISCAL NOTE: Effect on Local Government: No.
Effect on the State: Yes.
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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.
AN ACT relating to state financial administration; declaring the
policy of this State to make payments to private nonprofit
corporations under a grant agreement within a certain
period of time and to make advance payments of grants to
such corporations; with certain exceptions, imposing
interest on amounts due under a written grant agreement
which are not timely paid after receipt of a proper invoice;
requiring state entities that make grants to take certain
actions upon the receipt of an invoice; authorizing the use
of media other than original paper documents to expedite
grant payments; revising provisions relating to advance
payments of grants to private nonprofit corporations; and
providing other matters properly relating thereto.
Legislative Counsel’s Digest:
With certain exceptions, this bill enacts requirements governing payments by 1
agencies of the Executive Department of the State Government to private nonprofit 2
corporations that receive grants from those agencies and are reimbursed by those 3
agencies for services or other performance under a grant agreement. Section 3 of 4
this bill defines the term “grant” to establish the types of financial assistance to 5
which these requirements apply. Section 8 of this bill declares that it is the policy 6
of this State to: (1) complete all processing and authorization required by law to 7
make a payment, as defined in section 4 of this bill, within 30 calendar days after 8
receipt of a proper invoice, as defined in section 6 of this bill; and (2) make an 9
advance of a grant to a private nonprofit corporation to facilitate the expeditious 10
carrying out of the grant. Section 8.5 of this bill requires the State Board of 11
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Examiners to adopt policies and procedures to carry out the provisions of this bill, 12
which are required under existing law to be published in the State Administrative 13
Manual. (NRS 232.004) Section 8.5 mandates that such policies and procedures 14
include a requirement that a summary of the provisions relating to prompt 15
payments and advance payments be included in each grant agreement with a private 16
nonprofit corporation. 17
Section 9 of this bill provides that, with certain exceptions, a state entity that 18
makes a grant to a private nonprofit corporation, which is defined in section 7 of 19
this bill as a “state grant-making entity,” is liable for interest on amounts which are 20
due and payable under a written grant agreement at the rate that has been agreed 21
upon in the grant agreement, or if no such rate has been agreed upon, by a specified 22
rate. Section 9 provides that, with certain exceptions, interest begins accruing on 23
the 31st calendar day after the date on which the state grant-making entity receives 24
a proper invoice and requires interest to be paid from the operating budget of the 25
state grant-making entity, not including money appropriated to fund a grant. 26
Section 9 also requires a state grant-making entity that does not make a payment 27
that is due and payable under a written grant agreement within 30 calendar days 28
after receipt of a proper invoice to: (1) provide written notice to the private 29
nonprofit corporation of the reason for the delay in making the payment; and (2) 30
make a written record of the delayed payment and submit an annual compilation of 31
such records to the Director of the Office of Finance. 32
Section 10 of this bill requires a state grant-making entity to mark an invoice 33
with the date on which the invoice was received and review the invoice as soon as 34
practicable to determine whether the invoice is a proper invoice. Section 10 35
authorizes a state grant-making entity to use media that produce tangible recordings 36
of information to expedite payment in lieu of requiring original paper documents. 37
Section 11 of this bill authorizes a private nonprofit corporation to submit to a 38
state grant-making entity a request for an advance of money from the grant that was 39
awarded to the private nonprofit corporation by the state grant-making entity. 40
Section 11 requires the private nonprofit corporation to: (1) submit an expenditure 41
plan with its request for an advance and any other information requested by the 42
state grant-making entity; and (2) agree to requirements relating to reporting 43
expenditures, returning unexpended money, depositing the advance and reporting 44
related interest. Section 11, with certain exceptions, authorizes the state grant-45
making entity to approve the advance if it makes specific determinations and 46
verifications. With certain exceptions, section 11 limits the amount of such an 47
advance to be: (1) if the source of funding for the grant is state money, the amount 48
requested by the private nonprofit corporation, but not to exceed 25 percent of the 49
amount of the grant award; or (2) if the source of the grant is federal money, the 50
minimum amount to cover the immediate cash requirements of the private nonprofit 51
corporation in carrying out the purpose of the grant. Section 11 prohibits a state 52
grant-making entity from making an advance if the entity does not have sufficient 53
budgetary authority or a sufficient cash balance to pay the advance. 54
Section 11 requires: (1) the state grant-making entity to provide written notice 55
of the approval of any advance to the Director of the Office of Finance; and (2) the 56
Director to submit an annual report to the Interim Finance Committee relating to 57
advance payments of which the Director was notified. 58
Section 14 of this bill makes this bill effective on July 1, 2026, and section 13 59
of this bill excludes from the requirements of this bill grants which are executed, 60
renewed or extended before July 1, 2026. 61
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THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN
SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Section 1. Chapter 353 of NRS is hereby amended by adding 1
thereto the provisions set forth as sections 2 to 11, inclusive, of this 2
act. 3
Sec. 2. As used in sections 2 to 11, inclusive, of this act, 4
unless the context otherwise requires, the words and terms defined 5
in sections 3 to 7, inclusive, of this act have the meanings ascribed 6
to them in those sections. 7
Sec. 3. 1. “Grant” means a legal instrument of financial 8
assistance between a state grant-making entity and a private 9
nonprofit corporation that is: 10
(a) Used to enter into a relationship for which the principal 11
purpose is to transfer anything of value from the state grant-12
making entity to the private nonprofit corporation to carry out a 13
public purpose authorized by law and not to acquire property or 14
services for the direct benefit or use of the state grant-making 15
entity; 16
(b) Used to provide for one or more payments in 17
reimbursement for services or other performance under the 18
agreement on a scheduled or other incremental basis; and 19
(c) Distinguished from a cooperative agreement in that it does 20
not provide for substantial involvement between the state grant-21
making entity and the private nonprofit corporation in carrying 22
out the activity contemplated by the award. 23
2. The term does not include an instrument that provides 24
only: 25
(a) Direct government cash assistance to a person; 26
(b) A subsidy; 27
(c) A loan; 28
(d) A loan guarantee; 29
(e) Insurance; or 30
(f) State funding that is required annually and is calculated 31
based on a formula set in statute. 32
Sec. 4. “Payment” includes all processing and authorization 33
required by law from the State Board of Examiners, the Director 34
of the Office of Finance and the State Controller. 35
Sec. 5. “Private nonprofit corporation” means an 36
organization that has been granted tax-exempt status by the 37
Internal Revenue Service pursuant to the provisions of section 38
501(c)(3) of the Internal Revenue Code, 26 U.S.C. § 501(c)(3). 39
Sec. 6. “Proper invoice” means a bill, a request for 40
reimbursement, a written document or an electronic submission 41
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readable by the state grant-making entity that is provided by a 1
private nonprofit corporation and which: 2
1. Requests an eligible amount that is due and payable by law 3
under a written grant agreement with the private nonprofit 4
corporation; and 5
2. Includes: 6
(a) Sufficient information to identify the grant agreement; and 7
(b) Any additional information or documentation required by 8
the grant agreement or for compliance with 2 C.F.R. Part 200. 9
Sec. 7. “State grant-making entity” means an agency, 10
bureau, board, commission, department, division, officer or 11
employee of the Executive Department of the State Government 12
that makes a grant. The term does not include the Nevada System 13
of Higher Education or any institution of the Nevada System of 14
Higher Education. 15
Sec. 8. The Legislature declares that it is the policy of this 16
State to: 17
1. Make a payment under a grant agreement within 30 18
calendar days after receipt of a proper invoice. 19
2. Make an advance of a grant to a private nonprofit 20
corporation to facilitate the expeditious carrying out of the grant. 21
Sec. 8.5. 1. The State Board of Examiners shall adopt 22
policies and procedures pursuant to NRS 353.040 for carrying out 23
the provisions of sections 2 to 11, inclusive, of this act. 24
2. The policies and procedures adopted pursuant to 25
subsection 1 must include, without limitation: 26
(a) A requirement that a summary of the provisions of sections 27
2 to 11, inclusive, of this act is included in each grant agreement 28
into which a state grant-making entity enters with a private 29
nonprofit corporation; 30
(b) The criteria for determining the amount of an advance 31
pursuant to section 11 of this act; and 32
(c) The requirements for the reporting of interest earned on an 33
advance made pursuant to section 11 of this act. 34
Sec. 9. 1. Except as otherwise provided in subsection 3, a 35
state grant-making entity shall be liable for interest on any 36
amount that is due and payable by law under a written grant 37
agreement with a private nonprofit corporation at a rate that has 38
been agreed upon in the grant agreement or, if a rate has not been 39
so agreed upon, the rate equal to the prime rate at the largest bank 40
in this State, as determined by the Commissioner of Financial 41
Institutions on January 1 or July 1, based on the date on which 42
the written grant agreement was signed by the parties. 43
2. Interest for which a state grant-making entity is liable 44
pursuant to this section must accrue beginning on the 31st 45
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calendar day after the date on which the state grant-making entity 1
receives a proper invoice. 2
3. A state grant-making entity is not liable for interest 3
pursuant to this section: 4
(a) Unless the private nonprofit corporation submits an invoice 5
for the interest within 30 calendar days after receiving payment 6
for the amount on which the interest accrued; 7
(b) If the state grant-making entity has initiated legal 8
proceedings to dispute the amount owed to the private nonprofit 9
corporation; 10
(c) Accruing more than 1 year after the 31st calendar day after 11
the state grant-making entity receives a proper invoice; 12
(d) On an amount that represents unpaid interest; 13
(e) If the delay in payment is the result of technical problems 14
relating to the operation of the electronic payment system of the 15
state or federal grant-making entity, the closure of the office of the 16
state grant-making entity on a day declared to be a legal holiday 17
pursuant to NRS 236.015, extreme weather or another 18
extraordinary event; or 19
(f) If the state grant-making entity does not have sufficient 20
budgetary authority or a sufficient cash balance to process the 21
payment. 22
4. Interest for which a state grant-making entity is liable 23
pursuant to this section: 24
(a) Must be paid from the operating budget of the state grant-25
making entity; and 26
(b) May not be paid from money appropriated to provide 27
money for a grant. 28
5. For the purposes of determining the due date of a payment 29
and the date on which interest begins to accrue, an invoice is 30
deemed to be received: 31
(a) For invoices that are mailed, when a proper invoice is 32
received by the state grant-making entity, as of the date on which 33
the state grant-making entity annotates the invoice with the date 34
and time of receipt; or 35
(b) For invoices that are transmitted electronically, on the date 36
on which the transmission is received by the state grant-making 37
entity or, if the transmission is received after 5 p.m. on that date, 38
the next business day. 39
6. If a state grant-making entity does not make a payment for 40
an amount that is due and payable by law under a written grant 41
agreement with a private nonprofit corporation within 30 calendar 42
days after receipt of a proper invoice because of circumstances 43
described in subsection 3, the state grant-making entity shall, as 44
soon as practicable after that 30-day period: 45
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(a) Provide written notice to the private nonprofit corporation 1
of the reason for the delay in making the payment; and 2
(b) Make a written record of the delayed payment, including, 3
without limitation: 4
(1) The date on which the state grant-making entity 5
received a proper invoice for the payment; 6
(2) The reason for the delay by the state grant-making 7
entity in making the payment; and 8
(3) If applicable, the date on which the payment was made. 9
7. On or before October 1 of each year, the state grant-10
making entity shall submit to the Director of the Office of Finance 11
a compilation of the records made by the state grant-making entity 12
pursuant to paragraph (b) of subsection 6 during the immediately 13
preceding fiscal year. 14
Sec. 10. 1. Upon receipt of an invoice, a state grant-making 15
entity shall: 16
(a) Mark the invoice with the date on which the invoice was 17
received; and 18
(b) Review the invoice as soon as practicable to determine 19
whether the invoice is a proper invoice. 20
2. If the state grant-making entity determines that the 21
invoice: 22
(a) Is a proper invoice, the state grant-making entity shall 23
submit the invoice for payment in the same manner as other 24
claims against the State are paid. 25
(b) Is not a proper invoice, within 14 calendar days after 26
making such a determination, the state grant-making entity shall 27
notify the private nonprofit corporation of all defects that prevent 28
the invoice from being determined to be a proper invoice. A private 29
nonprofit corporation that receives such a notification may submit 30
a corrected invoice. 31
3. A state grant-making entity may use media that produce 32
tangible recordings of information to expedite the payment process 33
in lieu of requiring original paper documents. 34
4. Failure by a state grant-making entity to comply with the 35
procedural requirements of this section does not constitute a late 36
payment. 37
Sec. 11. 1. A private nonprofit corporation may submit to a 38
state grant-making entity, on a form prescribed by the Director of 39
the Office of Finance, a request for an advance from the grant 40
that was awarded to the private nonprofit corporation by the state 41
grant-making entity. 42
2. The private nonprofit corporation must include with the 43
form submitted pursuant to subsection 1 a plan for expenditure of 44
the advance which must, without limitation: 45
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(a) Align with the eligible activities and expenditures under the 1
grant; 2
(b) Provide the justification for the advance; and 3
(c) Describe the financial management policies that the private 4
nonprofit corporation has established to monitor expenditure of 5
the advance. 6
3. As a condition to receipt of an advance pursuant to this 7
section, a private nonprofit corporation must agree to: 8
(a) Transmit a report on the expenditure of the advance in the 9
manner required by the state grant-making entity, which includes, 10
without limitation, a summary of the work completed and proof of 11
expenditures. 12
(b) Return to the state grant-making entity any money from the 13
advance that was not expended within the timeline for expenditure 14
of the advance or for the eligible activities specified in the grant 15
agreement between the private nonprofit corporation and state 16
grant-making entity or receive a reduced amount for the 17
immediately succeeding payment under the grant in an amount 18
equivalent to the unexpended amount of the advance. 19
(c) Deposit the advance in a federally insured account that 20
provides the ability to track the interest earned on money in the 21
account and any withdrawal from the account. The account must 22
be opened in the name of the private nonprofit corporation and 23
not in the name of any director or officer of the private nonprofit 24
corporation. 25
(d) Report any interest earned on the advance deposited in an 26
account described in paragraph (c) in accordance with the policies 27
and procedures adopted pursuant to section 8.5 of this act. If the 28
source of funding for the grant is money from the Federal 29
Government, the private nonprofit corporation must return any 30
such interest payments to the state grant-making entity. 31
4. The private nonprofit corporation must submit any 32
additional information requested by the state grant-making entity, 33
including, without limitation, any information that is necessary for 34
the state grant-making entity to perform effectively risk assessment 35
and monitoring of recipients of subgrants from the grant. 36
5. An advance pursuant to this section: 37
(a) Unless prohibited by federal law or contractual agreement: 38
(1) May be approved by the state grant-making entity if the 39
state grant-making entity: 40
(I) Determines that the private nonprofit corporation 41
has demonstrated sufficient justification for the advance and does 42
not pose any undue risk to the state grant-making entity; 43
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(II) Determines that providing an advance does not 1
create an unreasonable administrative burden on or financial risk 2
to the state grant-making entity; and 3
(III) If applicable, has verified compliance by any 4
recipients of subgrants from the grant with the grant agreement 5
and applicable law. 6
(2) Is limited to: 7
(I) If the source of funding for the grant is money from 8
the State Government, the amount requested by the private 9
nonprofit corporation, but not to exceed 25 percent of the amount 10
of the grant award; or 11
(II) If the source of funding for the grant is money from 12
the Federal Government, the minimum amount to cover the 13
immediate cash requirements of the private nonprofit corporation 14
in carrying out the purpose of the grant in accordance with 2 15
C.F.R. Part 200. 16
(b) May not be approved by the state grant-making entity if the 17
state grant-making entity does not have sufficient budgetary 18
authority or a sufficient cash balance to pay the advance. 19
6. A state grant-making entity that approves an advance 20
pursuant to subsection 5 shall provide written notice of the 21
advance to the Director of the Office of Finance. 22
7. The requirements and penalties set forth in the grant 23
agreement apply to the use of the advance. 24
8. On or before October 1 of each year, the Director of the 25
Office of Finance shall submit a report to the Interim Finance 26
Committee concerning the advances for which the Director was 27
provided notice pursuant to subsection 6 during the immediately 28
preceding fiscal year. 29
Sec. 12. The provisions of NRS 218D.380 do not apply to any 30
provision of this act which adds or revises a requirement to submit a 31
report to the Legislature. 32
Sec. 13. The provisions of this act apply only to a grant, as 33
defined in section 3 of this act, which is executed, renewed or 34
extended on or after July 1, 2026. 35
Sec. 14. This act becomes effective on July 1, 2026. 36
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