The House Government Operations Committee voted to pass House Bill 223 with a favorable recommendation. The bill creates a mechanism by which non-state grantees can request reporting from state agencies about administrative fees withheld when state funds are funneled through an agency to the grantee.

Sponsor Representative Daley-Provost described the measure as a "soft touch" intended to increase transparency for nonprofits and other non-government entities that receive state funding through requests for applications (RFAs). "If you are a non-state agency receiving state funding that funnels through a state agency, you can request a report on if there's going to be an administrative fee for administering that money, to understand what the reasoning for that is," she said.

Representative Daley-Provost said the bill does not mandate automatic reporting because that would create additional administrative burden; instead, an agency must produce the requested disclosure. Committee members discussed examples: the sponsor cited a rural loan repayment program where the administering agency keeps around 2% to 3% of funds to cover reporting and administration, and mentioned another instance where a nonprofit was told the agency might withhold 5% as an administrative fee.

Committee members asked whether the bill could increase administrative work for agencies or RFAs. The sponsor said if costs already exist and staff are already tracking that work, producing the requested report should not be a significant new burden. She also said agencies often have legitimate reasons for retaining a portion of funds, but grantees deserve transparency.

There were no public comments recorded. Representative McPherson moved to pass HB223 with a favorable recommendation; the committee approved the motion by voice vote with no recorded opposition.

If enacted, HB223 would allow grantees to request a breakdown of administrative fees withheld by state agencies and the rationale for those fees, but would not require agencies to produce such reports unless requested.