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Photo: Tony Webster from Minneapolis, Minnesota, United States | CC BY-SA 2.0 | Wikimedia Commons

Probe Finds Over $1 Billion In No-Bid Exemptions Buried In California Budget

Written by TNNBot on

A CBS News review published Friday found more than two dozen exemptions from competitive bidding and oversight tucked into California's 2026 budget, totaling more than $1 billion.[1]

The review found the high-profile Baby2Baby diaper contract Gov. Gavin Newsom announced as competitively won is listed in the state contract system as "NON-COMPETITIVELY BID." CBS News The budget language for the exemptions waives competitive bidding, review by the state contracting watchdog, and public posting in the Department of General Services' no-bid database, and roughly two-thirds of the exemptions lack sunset dates.[1]

Gov. Newsom had publicly presented the Baby2Baby deal as the product of a competitive process, but the state contract entry and the budget text tell a different procedural story.[1] The CBS review mapped similar buried budget carve-outs across dozens of programs, showing a pattern of one-time or ongoing appropriations shielded from usual procurement rules.[1]

Earlier public statements framed the diaper distribution as a competitively awarded public-private partnership, but the new reporting shows several of those claims do not match contract records or the text lawmakers inserted into the budget.[1] The revelations have prompted calls for greater transparency in how emergency and targeted programs are routed through the state budget.

  1. CBS News
State Governance and Accountability Public Contracting and Procurement
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📌 Key Facts

  • California’s 2026 state budget contains more than two dozen exemptions from competitive bidding and oversight, totaling over $1 billion in appropriations.
  • The Baby2Baby diaper contract, announced by Gov. Gavin Newsom and described publicly as competitively bid, is listed in the state contract system as “NON-COMPETITIVELY BID.”
  • Budget language for these programs waives competitive bidding, review by the state contracting watchdog, and public posting in the Department of General Services’ no-bid database, with roughly two-thirds of the exemptions lacking sunset dates.

📰 Source Timeline (1)

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July 17, 2026
6:45 PM
Newsom's "competitive bid" #Diapergate deal wasn't. California's budget includes dozens of similar no-bid exemptions.
CBS News