An Act enhancing the effectiveness of nonprofits’ core mission work through full cost funding

SD 823 requires state-funded grants to nonprofits to cover indirect costs (like rent, utilities, and administrative expenses) at specific rates. It applies to nonprofits receiving state grants or mixed state/non-federal grants for service provision. If a nonprofit has a federal indirect cost rate (NICRA), it must be reimbursed at that same rate; if not, they get at least 15% of direct costs or can negotiate a new rate with the state. This directly affects 501(c)(3), (4), or (6) nonprofits relying on state grant funding. The bill aims to ensure nonprofits can fully cover operational costs without diverting mission-focused funds.