‘Competitive in Nature’? Records Raise New Questions About Newsom’s $6.2 Million California Diaper Deal

Newly released records suggest California’s contract with a nonprofit to distribute free diapers involved a noncompetitive bidding process, drawing concerns about favoritism.

The $6.2 million contract has come under scrutiny in part because of the nonprofit Baby2Baby’s connection with Gov. Gavin Newsom’s wife Jennifer Siebel Newsom. One of Baby2Baby’s co-CEOs, Kelly Sawyer Patricof, serves on the board of the California First Partners Project, which was founded by California’s first lady.

“The purpose of the competitive bidding process is to eliminate access to government contracts based on personal relationships, campaign contributions, or conflicts of interest, and get the best deal for the taxpayers,” Kendra Arnold, executive director of the watchdog Foundation for Accountability and Civic Trust, told the Daily Signal. “When it doesn’t go through the regular competitive bidding process, one of the things you look at is whether there was any favoritism.”

The watchdog asked California’s State Auditor Grant Parks to determine whether California followed proper procedures, why the administration used a noncompetitive contracting process, and whether the state met its public-transparency obligations. The complaint notes that $12.5 million was approved for the overall diaper program known as Golden State Start.

CBS News reported it took California 66 days to release documents on the contract, first announced in May. Neither the watchdog group nor news outlets established outright that the relationship influenced the state’s contract award to Baby2Baby.

“When there is a delay in the release of documents, it affects citizens’ trust,” Arnold said.

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FACT asked the auditor’s office to examine concerns of favoritism, transparency, and potential waste, citing the administration’s initial description of the process as competitive and the use of a legal noncompetitive procurement exemption.

The 356 pages of records obtained and reviewed by CBS News do not establish illegal conduct, as state lawmakers added exemptions into the state budget that made it legal for the administration to skip the usual process of competitive bidding and state contract review.

Arnold stressed that even if the contract award is legal, it should be scrutinized for potential waste.

“When the legislature passed these exemptions, it made it easier to award contracts based on possible conflicts of interest. The lack of oversight is reason for even more scrutiny,” Arnold said.

California Auditor’s Office spokeswoman Dana Simas told the Daily Signal that her office “is unable to provide comment on matters that are not part of a publicly released audit report.”

In a May post on X, Newsom’s press office said, “The First Partner’s non-profit has no connection to this effort.” In a previous post, the governor’s press office asserted: “Baby2Baby was chosen through a rigorous COMPETITIVE procurement process. It is a national nonprofit, based in California, with strong experience in delivering diapers for families in need and in the last 15 years they have distributed over 300 million diapers to families in need across the country.”

California’s official contract database, however, identifies the $6.2 million agreement as “Non-Competitively Bid,” CBS News reported.

Newsom’s press office did not respond to the Daily Signal for this story by publication time. But in a July 18 statement to CBS, Newsom’s office said calling the contract noncompetitive was “an inaccurate representation.”

“The process was still competitive, receiving 15 applicants who were judged on multiple factors including diaper cost, cost for implementation, existing infrastructure for manufacturing/distributing, and other significant considerations,” the statement from the governor’s office said. “The governor was referring to the process being competitive in nature, which remains accurate.”

Arnold said the “competitive in nature” language is designed to mislead.

“That language is frustrating for groups like ours that seek more transparency,” Arnold said. “It’s used with the intent to hide and mislead the public.”

However, CBS reported that the state did not follow a conventional bidding process, stating that a request for information was “Not a Solicitation.”

According to CBS News, state officials and potential vendors warned that the policy of giving every newborn 400 diapers in limited sizes could lead to waste and that other entities offered more sizes. The records show the state had identified another nonprofit, SupplyBank.org, as offering more diapers and more sizes.

Nevertheless, the final contract required families to receive 400 diapers at hospital discharge: 200 newborn-size and 200 size 1 diapers. The contract also required California branding on the diapers, though state records said a simpler design could reduce costs, according to CBS News.

CBS News also reported that Baby2Baby declined to identify its diaper manufacturer, located in Mexico, during the selection process.

More than two dozen similar contract exemptions appear in California’s 2026 budget, involving more than $1 billion in appropriations with no competitive bidding, CBS News previously reported. Those exemptions include a $253 million opioid-response fund, grants supporting a suicide and crisis lifeline, and a $12.9 million prison reentry program.

In 2022, Baby2Baby had a $1 million car seat contract with the state. In 2023, the organization had a $1.5 million contract for diaper distribution in Los Angeles.

The Baby2Baby organization did not respond to the Daily Signal for this story by publication time.