PNY urges state and local government to ensure full, on-time payment and contracting with the nonprofit sector, without significant cuts to an already lean budget, to ensure the health and safety of New York’s most vulnerable residents.
In response to New York State’s looming budget deficit, various administrative agencies have notified nonprofits that new contracts are on hold and that payments for existing contracts will be delayed and even cut in some cases. Nonprofits play a crucial role in New York - employing over 1.3 million New Yorkers and providing essential services related to health, food assistance, daycare and after school programming. In response to the novel coronavirus, many nonprofit providers have had to adapt their services in order to serve their clients safely and more effectively.
Though payment delays have been felt more acutely during this crisis, they certainly are not new. As outlined in Comptroller Thomas DiNapoli’s June 2020 report, 50% of contracts in 2019 between nonprofits and the state were not processed until after the contract start date. Under normal circumstances, these delays create serious cash flow issues. In our present reality, delays, cuts and non-renewals mean that many nonprofits will have to reduce or stop providing services altogether, leaving the most vulnerable New Yorkers without essential services at a time of increased vulnerability. Worse still, some nonprofits may have to shut their doors permanently.
Philanthropy New York urges New York State and City government to ensure that budget shortfalls are not passed onto nonprofits that serve the most vulnerable New Yorkers. New York state’s budget deficit cannot be bridged with cuts to human services. Philanthropy New York asks the state to ensure the stability of the nonprofit sector during this crisis by:
- Honoring all existing contracts by paying them in full and on time;
- Allowing for greater flexibility in how nonprofits render services for new and existing contracts given the global pandemic and constantly shifting demands;
- Committing to improve the contracting system so it is fast, fair and flexible; and
- Ensuring that all future contracts are paid in full and on time
Philanthropy New York and its members are committed to supporting the work of our nonprofit partners and asks that government take action to ensure adequate and full funding for the nonprofit sector.
Approved by the Public Policy Committee June 25, 2020
Approved by the Executive Committee July 1, 2020
Actions Taken to Support PNY's Policy Position