Senator Seyarto's proposal to modify California's Small Business Procurement and Contract Act would raise the maximum value of state contracts that can be awarded to certified small businesses through streamlined procedures from $250,000 to $350,000.

The legislation maintains existing requirements for state agencies and the California State University to obtain price quotations from at least two certified small businesses, microbusinesses, or disabled veteran business enterprises when awarding contracts valued between $5,000 and the maximum threshold. These contracts can be awarded without following standard competitive bidding procedures that apply to larger contracts. For purchases under $5,000, agencies must still obtain two price quotes if a single source may not offer a fair and reasonable price.

Beginning January 1, 2026, the Director of General Services would conduct biennial reviews of the maximum contract value and could adjust it based on changes in the California Consumer Price Index. This automatic review mechanism would allow the threshold to adapt to economic conditions without requiring new legislation. The bill applies these changes equally to both state agencies and the California State University system's contracting procedures.