Committee on Contracts

Wednesday, February 25, 2026, 11:30 a.m. (New York City time), 250 Broadway - 8th Floor - Hearing Room 2

Committee: Committee on Contracts

Video of the meeting

On the agenda

Documents

Summary

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.

Transcript

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