Gambling with taxpayer dollars: Colorado bill could allow nonprofits to get paid before work is done

By Cory Gaines | Colorado Accountability Project

Gambling taxpayer money to bolster our nonprofit ecosystem.

When you hire someone to do something for you, do you give them an advance? I’ve done it both ways: cash on delivery only and an upfront payment for, say, the materials.

The bill linked at bottom makes some noteworthy changes to the way our state interacts with multiple nonprofits it pays to do its work. There are multiple directions you could go in with your speculation, but I think it’s reasonable to conclude overall that the bill bolsters the connection between our government and nonprofits, that it enriches the tightly-interconnected ecosystem of NGO’s and nonprofits in Colorado.**

Under current law, prior to this bill, if a state awards a grant to a nonprofit for something, the nonprofit doesn’t get its money until the work is done. This would be the equivalent of cash on delivery for you and I.

With HB26-1274, state agencies can, under certain conditions, advance money to the nonprofits. It can give some or all of the funding to them without any actual work done.

Screenshot 1 attached is from the bill’s fiscal note. I highlighted the conditions for an advance in red.

Continuing with my analogy about hiring someone to do something for you, a natural question arises. A question hinted at by the part in blue in the picture. “Low risk” does not equal “NO risk”.

Assuming we cross all T’s and dot all I’s and work with due care and diligence, giving a nonprofit an advance on something, and they fold or skip town, what then? I have the sneaking feeling that we taxpayers merely get to eat the loss. I didn’t see anything in the bill about the state agency issuing the advance losing the money advanced out of their budget.

I don’t know that I have an issue with the idea behind this bill. As I said at the start, I’ve given advances on work I wanted done in the past. I did my due diligence in those cases and don’t regret it.

There is a huge difference here that my analogy glosses over, however. When I gamble, I gamble with my money, not someone else’s.

Rolling the dice using someone else’s money, particularly that of faceless millions, is worlds apart from using your own. I’d be a lot more supportive here if the state agencies that did the advancing took the risk; nothing makes you cautious like having skin in the game.

At my last check of this bill, it had cleared the legislature at the last minute and was headed to the governor’s desk where I have the intuition that he’ll sign.

**See “Related” below for another connection involving this bill.

https://leg.colorado.gov/bills/hb26-1274

Related:

One of the sponsors on this bill is Rep Lorena Garcia, a legislator who just so happens to run a nonprofit pulling down scads of government grant money.

Surprise, surprise.

More about her nonprofit and its state connections in an older op ed below.

https://completecolorado.com/2025/07/02/tax-dollars-colorado-non-profit-lorena-garcia/

READ THE FULL COMMENTARY AT COLORADO ACCOUNTABILITY PROJECT

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