Governor Gavin Newsom has put an end to the controversial $6.2 million no-bid diaper contract that has drawn criticism for months. This decision came after persistent pressure from the media for him to cancel the taxpayer-funded deal with a nonprofit organization linked to his wife.
The California Health Care Access Information Agency shared details about the contract with Baby2Baby late on a Friday evening, shedding light on the state’s management of the program. The initiative, known as the “Golden State Start,” aims to provide support following delays in public records requests and heightened scrutiny.
This announcement followed Newsom’s statement that the contract underwent a “competitive bidding process.” However, this assertion was contradicted by state documentation that categorized the contract under “non-competitive bidding” in California’s records.
The nonprofit, which has its CEO on the board of a charity founded by Jennifer Siebel Newsom, secured a contract for supplying 400 free diapers to each newborn at participating California hospitals.
The department justified its choice of Baby2Baby, claiming input was gathered from 15 organizations before concluding that the nonprofit had the necessary distribution network and partnerships to effectively launch the program.
Nonetheless, an investigation discovered that traditional competitive bidding was never actually conducted. Instead, state lawmakers tucked a provision into the lengthy budget document, exempting the diaper initiative from competitive bidding regulations and public accountability.
What’s more, the state only issued requests for information, which clearly indicated that it was “not a solicitation” for a binding contract. Although multiple organizations responded, some claimed they were either not interviewed or felt overlooked.
Republican lawmakers are questioning the decision to channel the program through a nonprofit, suggesting that direct purchases by hospitals or government entities would be more efficient.
“Using intermediaries and nonprofits translates to extra administrative expenses,” noted state Senator Roger Niello.
The Newsom administration, despite facing repeated public records requests, delayed releasing the contract and chose to do so just before the weekend, prompting criticism regarding the timing and limited public attention.
“This lack of transparency muddles the situation, and the administration misleads us about the competitive process,” commented Kendra Arnold, executive director of the Accountability and Civic Trust Foundation.
Under the newly announced arrangement, over half of the $6.2 million (roughly $3.89 million) will go towards buying Golden State Start brand diapers.
Additional spending includes $750,000 for shipping, $610,000 for warehousing, and $35,000 for communication efforts. Labor costs were estimated at $917,000, divided among 12 employees, averaging just over $78,000 per worker. Ultimately, the state estimates the cost per diaper could be as high as 12.5 cents.
