The Joint Mayoral and Comptroller task force presented recommendations to improve contracting and get nonprofit service providers paid on time
New York City Comptroller Brad Lander and senior members of the New York City Mayor’s Office stood together to release the findings of “A Better Contract for New York: A Joint Task Force to Get Nonprofits Paid On Time.” Both offices announced five actionable steps to better manage and streamline the nonprofit contracting and procurement process while increasing accountability and transparency. The recommendations were the result of a joint task force first convened during the transition period to jump start solving long-standing issues in city governance that impact the delivery of services to New Yorkers.
“For too long, the City has relied on nonprofits to deliver essential services without holding up its end of the bargain,” said Mayor Eric Adams. “The failure to pay our nonprofits in a timely manner has not only hurt our nonprofit sector, which is predominantly made up of Black and Brown workers, but also the New Yorkers who rely on their services. The findings from this task force will guide needed reforms to our contracting and procurement rules, improving transparency and accountability throughout all stages of the process. I thank Comptroller Lander for his partnership, the members of this task force, and the human services providers who perform life-saving work for New Yorkers who need it most every day.”
“Our City’s nonprofit human service providers are lifelines for New Yorkers, providing essential services from feeding the elderly to mental health care, yet our City’s cumbersome contracting process has hindered many nonprofits’ abilities to deliver these critical services,” said Comptroller Brad Lander. “With input from dozens of organizations and agency stakeholders, Mayor Adams and I put our heads together to substantially improve the process for the organizations New Yorkers rely on. Our mission was to ensure timely payments to responsible contractors so that organizations can continue to serve New Yorkers, while maintaining appropriate oversight to prevent abuses. I look forward to working with Mayor Adams, his future appointment to the newly created Mayor’s Office of Nonprofits, and our city’s essential non-profit organizations to implement these overdue reforms.”
New York City contracts out many of its programs to nonprofits—from health and housing assistance, shelter operations to after school activities. Last year, the City procured $12 billion in human services, totalling 40% of procured goods and services. The nonprofit sector is a substantial part of the City’s economy, employing over 500,000 people, an overwhelming majority of whom are women and people of color.
Unfortunately, many of these partners wait months, and up to more than a year, to get paid for services they provide to New Yorkers. In FY22, over three-quarters of the City’s contracts with nonprofit organizations arrived at the Comptroller’s office for registration after the start date. Delays and flaws in the process of registering and paying contractors have left many nonprofits in a lurch, taking out loans to continue their essential operations while they wait for reimbursement from the City.
“The overwhelming majority of human services nonprofit organizations serve in the best interest of the New Yorkers who rely on them, yet face too many challenges when doing business with the City. These organizations demonstrated endless commitment at the height of the pandemic when their workers showed up to make sure that residents were fed, housed, and had their most fundamental needs met when we were in crisis. Now we need to be there for them. These substantial reforms are grounded in shared accountability, greater transparency, and renewed leadership and management structures — which will ultimately get nonprofits paid on time for the services that build the City a stronger future,” said Annie Levers, Assistant Comptroller for Policy.
“Nonprofits provide numerous valuable services to the City of New York and its residents. Ensuring that they are paid on time and fairly is essential to getting resources in place that our city needs. As a backbone organization, United Way of New York City works closely with partners across sectors to make actionable change and initiatives that benefit New Yorkers in need. It is important for us to advocate on behalf of our nonprofit partners so that we can continue to support them in their timely and effective delivery of services that our city and residents depend on,” said Amy Sananman, Senior Vice President and Chief Impact + Strategy Officer at United Way of New York City.
“Our City’s human services partners show up every day to deliver critical services to our communities, including our most vulnerable residents. Their unwavering commitment is essential to the vitality and health of our City taking on greater significance during the pandemic,” said Lisa Flores, Director of Mayor’s Office of Contract Services. “MOCS is proud to be leading procurement reforms established by the Task Force that recognize our important partnership and make it easier for nonprofit partners to do business with the City. A procurement system that is transparent, accountable and accessible is the cornerstone for realizing greater equity in New York City.”
“Our city’s non-profits provide essential human services to thousands of New Yorkers—from afterschool programs, violence interrupters, to housing the homeless, and their contracts should be paid on time through a transparent process. The Bureau of Contracts Administration welcomes these recommendations and we look forward to working with our agency partners to streamline the registration process for nonprofits while ensuring accountability and oversight. These recommendations will go a long way towards a system that not only greatly benefit the non-profits, but also all those who rely on their services day-in and day-out,” said Charlette Hamamgian, Deputy Comptroller for Contracts and Procurement.
The primary recommendations for reforms included:
- Accountability and Transparency: Create new systems that both hold city stakeholders accountable for timely procurement and contracting and increase transparency to nonprofit providers and the public, including creating Contract-stat– a public data dashboard similar to Compstat.
- Streamline and Modernize: Reduce inefficiencies and delays in the procurement and contracting process with improved and expanded adoption of the PASSPort digital procurement system across agencies.
- Fairness and Equality: Lower the burden incurred by smaller, primarily BIPOC-led nonprofits when contracting with the City, including increasing the Returnable Grant Fund and rewriting the standard human services contract to acknowledge cost escalations, like cost of living adjustments, that would increase the original cost of these vital services contracts without the need for amendments.
- Leadership and Management Practices: Establish leadership and management practices at the highest levels of city government, including the new Mayor’s Office of Nonprofits, with input from nonprofit organizations.
- Capacity Building: Strengthen the capacity of nonprofit organization’s administrative and contracting capabilities through training and technical assistance to support nonprofits
The Mayor and Comptroller are jointly responsible for procurement and contract administration, each playing a defined role to protect public funds and award contracts fairly. Both offices have committed to ensure nonprofit contractors are paid on time, in full, on a predictable schedule, while preserving appropriate oversight to prevent abuses – and requires continued coordination between Mayoral agencies and the Comptroller’s Bureau of Contract Administration.
“We are proud to be part of this joint task force, which includes the Mayor’s office and the Comptroller’s office and introduces a new spirit of collaboration. This partnership builds on and enhances the work of the City Department for the Aging and its network of providers, which ultimately benefits all New Yorkers. Even in the darkest days of the pandemic, our network of providers never stopped serving older New Yorkers and delivering critical services. Providing our partners with a more efficient approach to contract registration and expedited reimbursement of invoices will help them better fulfill their mission and the goals of the City’s Community Care Plan for older adults,” said Commissioner Lorraine Cortés-Vázquez, Department for the Aging.
“The mission of the NYC Department of Youth and Community Development (DYCD) is to invest in a network of community-based organizations to operate a continuum of afterschool, community center, youth workforce, runaway and homeless youth, and anti-poverty programs that provide opportunities for New Yorkers and communities to flourish. Critical partners in achieving that mission are DYCD’s network of nonprofit providers—they are essential community institutions and one of New York City’s greatest assets. During the pandemic, we witnessed again the strength and commitment of the City’s community-based organizations in serving New Yorkers. DYCD is dedicated to improving the contracting process, and we look forward to working with our Administration colleagues, Comptroller’s Office, City Council, and the provider community in advancing the recommendations of the Action Memo,” said Anthony Ng, DYCD Acting Chief of Staff and Task Force member.
“In New York City, human service nonprofits sustain and support vulnerable New Yorkers. Government supports this work through the procurement system. UJA-Federation of New York stands with Mayor Adams and Comptroller Lander in recognizing that New York City’s procurement system is in high need of restructuring and improvement. This important report, created with a broad group of stakeholders, and issued less than 45 days into Mayor and Comptroller’s administrations, speaks to the commitment of the Mayor and Comptroller to reform procurement and their priority on the partnership, both between their offices and with New York’s nonprofit community,” said Louisa Chafee, Senior Vice President, Public Policy & External Relations, UJA-Federation of New York.
“VOA-Greater New York is proud to provide housing, health and wealth-building services that help to end homelessness in NYC. We believe that a vibrant nonprofit sector, unencumbered by systemic financial risk, can be a powerful force for transformative change in NYC. We are grateful to Mayor Eric Adams and Comptroller Brad Lander for convening this task force. The recommendations in this report serve as a roadmap to ensuring that the City’s procurement and contracting process enhances the quality of services we provide to our neighbors in need, and I look forward to working with them both on implementing these reforms,” said Myung Lee, CEO of VOA-Greater New York.
