The Nonprofit Services Preservation Amendment Act of 2025 aims to enhance the Nonprofit Fair Compensation Act of 2020 by ensuring that nonprofit organizations partnering with the District government receive fair compensation for both direct and indirect costs associated with delivering essential services. The bill increases the minimum indirect cost rate from 10% to 15%, aligning it with the federal rate established in October 2024. It also mandates clearer contract language, improved transparency, and annual training for agency staff on compliance with these requirements. Additionally, the legislation introduces a nonprofit relief grant program to assist organizations in covering funding gaps and indirect costs.

Key amendments include the clarification that funding for indirect costs is supplementary to direct service funding, the establishment of a plain language indirect cost compensation clause in all nonprofit contracts, and the requirement for the Mayor and the Office of Contracting and Procurement to provide guidance on indirect cost calculations and negotiations. The bill also outlines a phased implementation timeline based on the value of grants and contracts, ensuring that nonprofits are adequately supported in their operations and can continue to provide vital services to the community without financial strain.