Saturday, April 24, 2021



$120 million in added funding over two years brings indirect rate investment to $94 million annually

 Mayor Bill de Blasio and Speaker Johnson today announced increased funding for nonprofits and human service providers for indirect costs. ​This funding will provide financial stability for ​hundreds of nonprofit human service providers as they ​continue to partner with the City on a recovery for all of us.


The Indirect Cost Rate (ICR) Funding Initiative​ launched in 2019 and grew out of a partnership between the Mayor, City Council and sector leaders ​through the Nonprofit Resiliency Committee. Today's announcement of $120 million over two years will bring the total investment for indirect cost rates to $94 million annually. This investment fully funds current Accepted Indirect Cost Rates. The City is proud to have partnered with the sector to become a national leader in recognizing the significance of indirect costs in the delivery of human services. This additional funding builds on steps ​and reforms this Administration has taken​ in collaboration with the sector to support resiliency in the human services sector, ​including advance payments on contracts, more timely contract registration, and streamlining business practices.  ​This funding also comes at a time when human service organizations are being called upon to reach more deeply into communities to help New Yorkers in need in light of COVID-19.


“Nonprofits serving our most vulnerable residents are critical partners in our recovery,” said Mayor Bill de Blasio. “Indirect cost funding will help keep doors open, support workers and help bring our city back. I thank Speaker Johnson and the City Council for their partnership.”


“Nonprofits fill the vacuum to provide critical services for New Yorkers, playing a crucial role in our social safety net that has become even more important as we battle COVID-19. Despite that, they haven't always received the funding they need. The Council has long advocated to pay these non-profits their fair share, including in 2019 when we created the Indirect Cost Rate Funding Initiative with this Administration. We also asked for increased funding in our budget response this year, which is exactly what we are getting. The fact that this is baselined makes this welcome news even better. I thank the de Blasio Administration for being our partner in this effort, and my Council colleagues for always fighting for our nonprofits," said Council Speaker Corey Johnson.


“Our City’s mission and commitment to support New Yorkers in need would not be possible without our absolutely vital human services providers and non-profit partners,” said Deputy Mayor for Health and Human Services Melanie Hartzog. “For years, they’ve been on the frontlines, doing the hard work on the ground every day, as part of our shared push for a more progressive, inclusive, and supportive New York – and this past year, they went above and beyond, to do more for our vulnerable neighbors than any of us could have imagined. With this announcement, we’re focused on investing in these vital partners to increase sustainability for the sector, ensuring they can keep providing that helping hand that so many in our city rely on.”


The funding is applicable to health and human contracts across all City agencies, including the Department of Education, with limited exceptions, and accommodates providers and all levels of sophistication. It covers a portion of provider costs that are not directly attributed to service delivery, but are necessary for operations like accounting, human resources, rent, general operations, and other eligible costs.


The City’s investments to date in the nonprofit sector have totaled over $700 million annually and have supported wage increases for employees, including a minimum wage of $15 per hour and a 9 percent increase in wages, and parity for early childcare workers, funding for indirect rates, rate enhancements for several critical programs such as homeless shelters, Beacon youth centers, and case management for senior centers.


These actions build on the Administration’s launch of the Non-Profit Resiliency Committee (NRC) in September 2016, which represented a substantial change in the City’s approach to working with nonprofit service providers, resulting in a fuller and more collaborative partnership.

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