republic-os/legislation/us/states/ca/20212022/ab-1776.md

---
type: "Bill"
title: "Resource conservation districts: California Prompt Payment Act."
description: "Existing law, the California Prompt Payment Act, generally provides that a state agency that acquires property or services pursuant to a contract with a business but fails to make payment to the person or business on the date required by the contract is subject to a late payment penalty, as specified. The act requires state agencies to pay applicable penalties, without requiring that the claimant submit an additional invoice for these amounts, whenever the state agency fails to submit a correct claim to the Controller by the required payment approval date and payment is not issued within 45 calendar days from the state agency receipt of an undisputed invoice. The act requires a state agency to pay, through the Controller, to the claimant a penalty at a rate of 10 percent above the United States Prime Rate on June 30 of the prior fiscal year if the claimant is a certified small business, a nonprofit organization, a nonprofit public benefit corporation, or a small business or nonprofit organization that provides services or equipment under the Medi-Cal program, as prescribed. The act requires, if the Director of Finance determines that a state agency or the Controller is unable to promptly pay an invoice as provided for by this chapter due to a major calamity, disaster, or criminal act, the late payment penalty provisions described above to be suspended, except as they apply to certain claimants, including a certified small business, a nonprofit organization, or a nonprofit public benefit corporation."
jurisdiction: "us/states/ca"
legislature: "California Legislature"
session: "20212022"
identifier: "AB 1776"
citation: "California AB 1776 (20212022)"
classification: ["bill"]
subjects: ["Resource conservation districts: California Prompt Payment Act."]
status: "enacted"
primary_sponsors: ["Gallagher"]
version_count: 5
action_count: 21
vote_count: 7
first_action: "2022-02-03"
last_action: "2022-09-22"
source: "openstates"
source_identifier: "ocd-bill/a8a4f08d-05f5-411f-a641-fe460ba3a1b1"
source_url: "http://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=202120220AB1776"
source_hash: "a19308bd9c7c3c3c2828a5da0d64be17c90a77b1a20b0e4173e6d0d87d2682d2"
vintage: "2026-07-01"
source_snapshot: "https://data.openstates.org/daily/2026-07-01/public.pgdump"
retrieved_at: "2026-07-06"
confidence: "reported"
tags: ["legislation", "bill", "us-ca"]
---

# California AB 1776 (20212022) — Resource conservation districts: California Prompt Payment Act.

Existing law, the California Prompt Payment Act, generally provides that a state agency that acquires property or services pursuant to a contract with a business but fails to make payment to the person or business on the date required by the contract is subject to a late payment penalty, as specified. The act requires state agencies to pay applicable penalties, without requiring that the claimant submit an additional invoice for these amounts, whenever the state agency fails to submit a correct claim to the Controller by the required payment approval date and payment is not issued within 45 calendar days from the state agency receipt of an undisputed invoice. The act requires a state agency to pay, through the Controller, to the claimant a penalty at a rate of 10 percent above the United States Prime Rate on June 30 of the prior fiscal year if the claimant is a certified small business, a nonprofit organization, a nonprofit public benefit corporation, or a small business or nonprofit organization that provides services or equipment under the Medi-Cal program, as prescribed. The act requires, if the Director of Finance determines that a state agency or the Controller is unable to promptly pay an invoice as provided for by this chapter due to a major calamity, disaster, or criminal act, the late payment penalty provisions described above to be suspended, except as they apply to certain claimants, including a certified small business, a nonprofit organization, or a nonprofit public benefit corporation.

## Version chain

The bill's text revisions, in order — the diff chain from filing to enrollment.

1. **02/03/22 - Introduced** (filed) — [source](https://leginfo.legislature.ca.gov/faces/billPdf.xhtml?bill_id=202120220AB1776&version=20210AB177699INT)
2. **03/24/22 - Amended Assembly** (committee substitute) — [source](https://leginfo.legislature.ca.gov/faces/billPdf.xhtml?bill_id=202120220AB1776&version=20210AB177698AMD)
3. **09/22/22 - Chaptered** (committee substitute) — [source](https://leginfo.legislature.ca.gov/faces/billPdf.xhtml?bill_id=202120220AB1776&version=20210AB177696CHP)
4. **AB1776** (committee substitute) — [source](http://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=202120220AB1776)
5. **08/19/22 - Enrolled** (enrolled) — [source](https://leginfo.legislature.ca.gov/faces/billPdf.xhtml?bill_id=202120220AB1776&version=20210AB177697ENR)

## Votes

- AB 1776 Gallagher Assembly Third Reading — **76–0** (pass) · lower
- 3rd Reading AB1776 Gallagher et al. By Nielsen — **38–0** (pass) · upper
- Do pass, but first be re-referred to the Committee on [Appropriations] with the recommendation: To Consent Calendar — **13–0** (pass) · upper
- Placed on suspense file — **7–0** (pass) · upper
- Do pass — **7–0** (pass) · upper
- Do pass. — **16–0** (pass) · lower
- Do pass as amended and be re-referred to the Committee on [Appropriations] — **7–0** (pass) · lower

## Sponsors

- Gallagher — primary (person)
- Nielsen — coauthor (person)

## Timeline

The legislative action history — every referral, reading, and vote.

- **2022-02-03** Read first time. To print. `reading-1`
- **2022-02-04** From printer. May be heard in committee March 6.
- **2022-02-10** Referred to Com. on A. & A.R. `referral-committee`
- **2022-03-23** From committee: Amend, and do pass as amended and re-refer to Com. on APPR. (Ayes 7. Noes 0.) (March 23). `amendment-introduction, amendment-passage, committee-passage, referral-committee`
- **2022-03-24** Read second time and amended. `amendment-passage, reading-1, reading-2`
- **2022-03-28** Re-referred to Com. on APPR. `referral-committee`
- **2022-04-27** In committee: Set, first hearing. Referred to suspense file. `referral-committee`
- **2022-05-19** From committee: Do pass. (Ayes 16. Noes 0.) (May 19). `committee-passage, committee-passage-favorable`
- **2022-05-19** Read second time. Ordered to third reading. `reading-1, reading-2`
- **2022-05-25** Read third time. Passed. Ordered to the Senate. (Ayes 76. Noes 0. Page 4961.) `passage, reading-1, reading-3`
- **2022-05-26** In Senate. Read first time. To Com. on RLS. for assignment. `reading-1`
- **2022-06-01** Referred to Com. on G.O. `referral-committee`
- **2022-06-29** From committee: Do pass and re-refer to Com. on APPR with recommendation: To Consent Calendar. (Ayes 13. Noes 0.) (June 28). Re-referred to Com. on APPR. `committee-passage, committee-passage-favorable, referral-committee`
- **2022-08-02** In committee: Referred to suspense file. `referral-committee`
- **2022-08-11** From committee: Do pass. (Ayes 7. Noes 0.) (August 11). `committee-passage, committee-passage-favorable`
- **2022-08-11** Read second time. Ordered to third reading. `reading-1, reading-2`
- **2022-08-18** Read third time. Passed. Ordered to the Assembly. (Ayes 38. Noes 0. Page 4907.). `passage, reading-1, reading-3`
- **2022-08-18** In Assembly. Ordered to Engrossing and Enrolling. `committee-passage`
- **2022-08-23** Enrolled and presented to the Governor at 3 p.m.
- **2022-09-22** Approved by the Governor. `executive-signature`
- **2022-09-22** Chaptered by Secretary of State - Chapter 455, Statutes of 2022. `became-law`

## Source

OpenStates / OpenCivicData bulk snapshot [2026-07-01](https://data.openstates.org/daily/2026-07-01/public.pgdump); origin `ocd-bill/a8a4f08d-05f5-411f-a641-fe460ba3a1b1`. Confidence: reported (aggregated from official California legislature records).