The proposed bill aims to enhance economic development by prohibiting grants to nonprofit organizations that have highly compensated officers or employees. Specifically, it establishes that any nonprofit organization compensating an officer or employee more than 125 percent of the governor's salary within a 12-month period will be ineligible for grants under any economic or workforce development programs overseen by the commissioner for the current and following fiscal years. The bill also mandates that this salary limit be adjusted annually based on changes to the governor's salary and the Consumer Price Index.

Additionally, the bill defines "compensation" to include not only salary but also bonuses, stock options, employee benefits, and contributions to retirement plans. However, it clarifies that this prohibition does not apply to performance grants administered under a specific section of the law. This legislation seeks to ensure that public funds are allocated to organizations that maintain reasonable compensation practices.