Wednesday, February 25, 2026, 11:30 a.m. (New York City time), 250 Broadway - 8th Floor - Hearing Room 2
Committee: Committee on Contracts
The Committee on Contracts, chaired by Council Member Lincoln Restler, held an oversight hearing on nonprofit and human services contract payments, hearing testimony from the Mayor's Office of Contract Services (MOCS) and the Mayor's Office of Nonprofit Services (MONS). Directors Kim Yu and Michael Cedillo reported progress including 88% on-time registration for FY26 human services contracts, the discretionary grant pilot, expanded returnable grant fund, 50% advances, a payment task force, and ContractStat tracking, while acknowledging a remaining $2.3 billion backlog. The committee also heard Introduction 441 (task force on underutilization of community-based vendors) and Introduction 452 (wage floor for human service workers), both sponsored by Council Member Althea Stevens, plus a resolution on food contract flexibility. Numerous nonprofit providers and umbrella organizations testified about delayed payments totaling millions of dollars and voiced support for Intro 452.
1:39 You oh quiet please keep it on d
1:39 welcome to New York City
5:48 hybrid hearing on a committee
5:50 on contracts please silent all
5:52 electronic devices at this
5:55 time also please do not
5:57 approach deas do you have any
5:58 questions please raise your
5:59 hand one of us decided
6:00 . At arms that came to assist
6:02 you thank you very much for
6:04 your kind cooperation cheer
6:05 we're ready to begin all right u
6:12 guys for joining us my name is
6:14 Lincoln ressler I have the
6:16 great privilege of chairing
6:17 the City Council's contracts
6:18 committee and I want to thank
6:21 so many neighbor so many
6:23 nonprofit leaders and civic
6:24 leaders for joining us today
6:26 we're joined by the inimitable
6:29 gayle Brewer on manhattan's
6:31 own and a number of other
6:32 colleagues I think will be
6:32 joining us from across the
6:34 street as this anti hate
6:37 hearing progressives
6:38 . Today we are holding an
6:39 oversight hearing on nonprofit
6:41 and human service contract
6:42 payments this is a topic that
6:44 has been the subject of a
6:45 great number of policy
6:48 pronouncements media reports
6:49 press conferences and rallies
6:51 but I have to say it feels
6:52 like groundhog day to me
6:53 . Because we're still waiting
6:55 for this dysfunctional system
6:57 to finally get fixed we all
6:58 know that the City of New York
7:01 could not function for one
7:03 single day without our
7:04 phenomenal nonprofit pride
7:06 providers.
7:06 And yet we too often treat
7:08 these essential partners
7:10 terribly the purpose of this
7:11 hearing is to level set
7:13 . About where we are today
7:14 when it comes to getting
7:15 contracts registered on time
7:17 and paying providers in real
7:18 time for the work they do as
7:21 the New chair of the contracts
7:23 committee I am focused on and
7:25 committed to partnering with
7:27 the mandana administration in
7:28 particular director yu and
7:29 director cedillo and I really
7:30 want to thank them for being
7:33 here today and nonprofit
7:33 leaders across our City to fix
7:36 our procurement system and our
7:37 fiscal systems once and for
7:38 all on a personal level I have
7:41 spent my career shifting
7:43 between government and the non
7:44 profit I've worked in City
7:45 administrations trying to help
7:47 fix this problem like being
7:48 involved in the nonprofit
7:49 resiliency committee back in
7:53 201620 17 and I've worked for
7:54 nonprofit partners that have
7:55 suffered the consequences of
7:56 failing to get paid I proudly
7:57 served on the board of the
7:58 human services council when I
7:59 led the New York City
8:00 employment and training
8:01 coalition which represents the
8:02 workforce development groups
8:03 across the City of New York I
8:05 worked at a beloved north
8:07 brooklyn settlement house that
8:08 supports neighbors from cradle
8:10 to old age I've served on the
8:11 boards of a number of
8:13 nonprofits from community
8:15 corporations specific
8:15 associations and have been
8:17 deeply enmeshed in many many
8:18 more nonprofit organizations
8:19 that I admire immensely I've
8:22 seen firsthand just how
8:23 debilitating it is for a
8:24 nonprofit to not be able t
8:26 oaccess the money it is owed t
8:26 othem by the City of New York
8:29 and have to take out costly
8:31 loans just to pay workers and
8:32 to keep the lights on every
8:33 year the City procures $15.6
8:38 billion in goods and services
8:39 from the human services sector
8:42 for context that is bigger
8:43 than the budgets of entire
8:44 states like south carolina or
8:45 rhode island these human
8:47 service contracts are for
8:49 essential services from
8:51 operating homeless shelters t
8:52 oproviding legal counsel t
8:53 otenants facing addiction t
8:54 oserving meals to seniors and
8:56 so much more New yorkers rely
8:57 on these services every single
9:00 moment of every single day 24
9:02 hours a day seven days a week
9:04 365 days a year yet for far
9:08 too long the City has failed
9:09 to reliably pay these
9:10 organizations on time and the
9:11 City is not just a little late
9:14 to many nonprofits get ghosted
9:15 for months and months and
9:17 months and April 2025 report
9:19 from controller bradley brad
9:21 lander found that the average
9:21 time it takes from a contract
9:23 start date until the first
9:24 payment is issued is 388 days
9:27 for I should say from the
9:28 first from the contract
9:29 started until the first
9:30 invoices is processed is is
9:33 388.
9:33 Even with 25% advance
9:35 payments upon budget approval
9:37 nonprofits are working for
9:38 over a year and waiting for an
9:40 additional dime of payment to
9:43 be received if a freelancer
9:44 didn't get paid for a year the
9:45 department of consumer and
9:46 worker protection which wrote
9:47 the book at that shady
9:48 employer as of last April 250
9:51 0contracts worth $4.6 billio
9:53 nhad already passed there start
9:54 dates without being registered
9:56 . And even when a contract is
9:58 registered agencies don't pay
10:00 the invoices this report from
10:02 comptroller lander back in of
10:04 last year found that there
10:05 were over 4000 unpaid invoices
10:08 worth over $861 million at the
10:12 time of the at the time the
10:13 report was issued.
10:15 In 20 24 the health
10:16 department and the homeless
10:18 over 40 days to process
10:23 invoice payments and had
10:24 hundreds of invoices pending
10:25 for over a hundred days we
10:26 hope to receive updates on
10:27 improved data today
10:29 . But the figure in this this
10:32 20 25 were alarming and
10:33 frankly damning
10:33 . When the City doesn't pay
10:34 its bills for months and years
10:37 on end nonprofits have to find
10:38 a way to pay their bills and
10:40 their workers to continue t
10:42 oprovide these essential
10:43 services in order to mak
10:45 epayroll and keep operating
10:46 they take out costly loans
10:48 many are forced to turn t
10:49 oprivate Banks that charge
10:51 hefty interest fees here's one
10:53 example liz knee legal
10:54 services of New York is paying
10:56 $80000 per month on a line of
10:58 credit for their 60 millio
10:59 ncontract with the City that's
11:00 almost a million dollars per
11:02 year if the City paid on time
11:03 those funds could instead be
11:04 we could fund six attorneys
11:06 that help an additional 400
11:08 tenants in the right t
11:09 ocounsel program in 20 23
11:12 shuttering
11:12 . Arms a 200 year old family
11:14 services organization was
11:15 forced to shut down entirely
11:16 in no small part due t
11:18 oseverely late City payments
11:20 these delays impact large
11:22 citywide organizations and and
11:24 small neighborhoods cbos they
11:26 impact multimillion dollar
11:27 contracts and $5000 City
11:29 council discretionary awards I
11:30 have heard from dozens of
11:32 nonprofit organizations since
11:33 becoming chair of the
11:34 contracts committee just
11:36 several weeks ago and the
11:37 overarching message it's clear
11:39 more nonprofits will close and
11:41 services will suffer if the
11:42 City doesn't solve this I
11:45 absolutely believe these kafka
11:46 esque bureaucratic delays can
11:48 be averted through strong
11:49 leadership at City Hall focus
11:51 management and City agencies
11:54 crisp transparent data and
11:56 meaningful accountability
11:56 across the board
11:57 . These delays are not about
11:59 dollars and cents these delays
12:01 are not just about dollars and
12:03 cents or paperwork they're
12:05 about essential services.
12:06 And they're about hard
12:07 working professionals New York
12:08 er's in need the nonprofit
12:10 sector in New York City
12:10 employs over 600000 people
12:13 that's more than the entire
12:14 populations of atlanta or
12:17 milwaukee or baltimore
12:17 . The nonprofit sector is a
12:18 vital component of our local
12:20 economy and according to the
12:21 human services council 70% of
12:24 the workers are women 75% are
12:25 people of color if the City
12:26 didn't pay our sanitation
12:28 workers or our teachers on
12:29 time they'd stop working it
12:30 would be a full blown
12:31 emergency that would get
12:33 immediate attention and
12:34 notably we do not see the same
12:36 scale of delays on City
12:39 payments to for profit vendors d
12:42 to treat our nonprofit
12:43 partners with the respect they
12:46 deserve.
12:46 This problem isn't New and
12:47 unfortunately it doesn't
12:48 appear to be getting much
12:49 better the controllers office
12:50 found that from 22019 2 20 24
12:53 the time it took to pay
12:55 nonprofits actually increased
12:56 by 16% the City Council passed
12:59 legislation in 20 23 local law
13:02 hundred 69 sponsored by my
13:03 friend and colleague off the s g
13:06 timelines for the contracting
13:07 process but unfortunately the
13:08 end result was a proposal for
13:11 up to a 510 day procurement
13:12 process to get contracts
13:14 registered with broad
13:14 exemptions baked in we need
13:17 action now
13:18 . We need to clear the backlog
13:20 initiative focused not only on
13:22 contract registration but also
13:23 on invoice payment we need a
13:25 public dashboard with real
13:26 time monitoring and tracking
13:27 of data so that we can
13:30 determine where contracts and
13:31 invoices are getting held up
13:32 and what agencies need more
13:33 staffing and support t
13:35 odeliver we should restart the
13:36 nonprofit resiliency committee
13:38 to ensure the administration
13:39 nonprofits and the council are
13:41 prioritizing tangible swift
13:42 progress and we should expand
13:44 the returnable grant fund so
13:46 that all nonprofits can
13:47 readily access loans avert
13:48 interest payments and avoid
13:50 insolvency we need leadership
13:51 at City Hall to hold agencies.
13:53 Accountable when they fail
13:53 to make payments on time I am
13:56 genuinely optimistic as we
13:57 enter this New mayoral
13:59 administration
13:59 . And a New City Council term
14:01 that we finally have the
14:03 support and momentum needed t
14:04 oaddress these problems.
14:05 I have been really impressed
14:07 by kim you and michael cedillo
14:09 and I appreciate that mocks
14:12 and mons and their teams have
14:13 been working hard to address
14:15 these issues I hope that
14:16 senior staff at City Hall
14:17 makes this a priority there
14:19 are a number of positive
14:21 initiatives in the works
14:23 piloting a grant initiative
14:24 for counsel discretionary
14:25 funding a New quarterly
14:26 payment model for and mc j
14:29 contractors expanding the
14:30 returnable grant program 50%
14:32 advances on contracts taking
14:33 effect later this year
14:35 standing up contracts that
14:36 internally and much more I
14:39 firmly believe the New rigor
14:41 and competence across the
14:42 street at City Hall will help
14:43 us make make major strides
14:45 strides in cleaning up this
14:45 mess
14:46 . We are also hearing two
14:48 bills and one resolution today
14:50 . Introduction 40441 sponsored
14:53 by Council Member would
14:55 establish a task force t
14:56 oexamine the underutilization
14:58 of of community based vendors
15:00 and City contracting since the
15:01 late payment crisis often hits
15:04 small local organizations the
15:05 hardest introduction 4 52 also
15:07 sponsored by council members
15:08 who has an amazing knack of
15:11 time for timing um what wage
15:13 floor for human service
15:14 workers whose wages have
15:16 lagged behind comparable City
15:18 positions for decades City
15:19 contracts provide far too
15:20 little compensation t
15:23 ononprofit staff I've been a
15:23 stalwart supporter of the just
15:24 pay campaign for years and we
15:27 need to evaluate and explore
15:29 every potential creative
15:31 solution that will increase
15:32 wages for nonprofit workers
15:34 Council Member brings deep
15:37 expertise about the nonprofit
15:38 sector to this work the human
15:40 services sector could not hope
15:42 for a more effective or
15:43 frankly a more tenacious
15:45 champion than Althea and
15:47 resolution 1 83 sponsored by
15:48 three sponsored by council
15:49 member for riaz calls on the
15:50 state to pass legislation t
15:52 oallow more flexibility on food
15:54 contracts before we begin I
15:55 want to recognize the
15:57 contracts committee staff who
15:58 I have just been incredibly
16:00 impressed by for their hard
16:01 work and preparing for today's
16:03 hearing senior counsel alex
16:04 poling off committee counsel
16:06 djuhari frazier who we have
16:07 stolen from the gaps committee l
16:09 hangs out with gail there too
16:12 policy analyst alexi blanc
16:14 financial analyst analyst owen
16:15 cutoff ski and I would
16:15 especially like to thank my
16:17 brilliant and I really want t
16:19 ounderscore the word brilliant
16:19 chief of staff molly haley
16:21 . With that I will turn it
16:21 over to Council Member if
16:22 she'd like to make remarks
16:25 about her bills does she need
16:26 you need time she does have
16:27 food in her two seconds I can
16:30 fill time I again really want
16:32 to thank kim and michael for
16:33 being here with us today we're
16:34 really excited about their
16:35 testimony and it's great t
16:36 osee so many nonprofit leaders
16:37 from across the City joining
16:38 us and I want to thank council
16:40 member one the former chair of
16:41 this committee who did a great
16:43 job leading it for joining us
16:45 on zoom with that I will pass
16:47 it over to council members
16:48 this you know I can talk.
16:51 I okay good good morning how
16:53 are you to see so many people
16:56 in here I'm happy to see you
16:57 guys are still with us today
16:59 I'm proud to advance to people f
17:04 legislation that speaks
17:05 directly to quote equality
17:07 fairness and accountability on
17:09 how New York City does
17:10 business
17:11 . Intro 441 established the
17:12 task work to examine the
17:13 disparities in City
17:15 contracting brought to long
17:16 long black and brown women
17:18 businesses have faith
17:20 sto take a harder look at the
17:26 data identify where in
17:28 inequalities are and persist
17:30 and develop concentrated
17:31 recommendations to ensure our
17:33 contracting processes is
17:34 transparent inclusive and fair
17:35 intro 402 a man amends the
17:38 administrative code to
17:40 establish a wage requirement
17:41 for City contracted human
17:42 service workers those workers
17:44 provide essential care and
17:45 support to our to the most
17:47 vulnerable New York er's yet
17:49 they are often underpaid and
17:52 undervalued this bill bill is
17:54 about dignity economic justice
17:56 and recognizing that equality
17:59 serves services require
18:00 stability fairness and compass
18:01 and a compensated workforce
18:03 . Today these bills move as
18:04 closer to a City that truly