California Prompt Payment Act: late payment penalties.

Assembly Member Connolly's modification to California's Prompt Payment Act shifts how the Department of Forestry and Fire Protection manages payment deadlines, replacing the annually declared fire season with a peak fire protection staffing period as the basis for extending payment approval dates.

Under the amended provisions, the Department may extend its payment approval deadline by 30 calendar days when invoices would incur late penalties during peak staffing periods, as determined by the Director of Forestry and Fire Protection. This extension excludes contracts with certified small businesses, nonprofit organizations, and nonprofit public benefit corporations. The bill also establishes conditions under which the Director of Finance may suspend late payment penalties during major calamities, disasters, or criminal acts, while maintaining protections for small businesses, nonprofits, and organizations providing Medi-Cal services.

The legislation maintains existing requirements that late payment penalties continue accruing when payment delays stem from the absence of an enacted state budget, except for nonprofit public benefit corporations. These corporations receive an explicit exemption from penalties during budget impasses, codifying their protected status during periods of fiscal uncertainty.