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City Charter Reform Could Help Nonprofits Get Paid On Time

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David Greenfield, a former NYC Council member now works as the CEO of the Metropolitan Council on Jewish Poverty. "We're really asking the Charter commission to resolve a decades-old problem,” he said. Photo Credit: Twitter

It can be hard enough to run a nonprofit organization, so it only makes matters worse when the New York city government doesn’t do its part. The city is supposed to help nonprofits by providing some funding, but nonprofits have oftentimes been left waiting as funds come in late. Now some nonprofits are trying to change that fact, according to The Daily News.

The effort is composed of over 100 nonprofits that all want a change in the city Charter. The Human Services Council leads the effort and has had enough of waiting around while its vital services to the city’s vulnerable couldn’t proceed as planned without the city’s funds. The organizations signed a letter that it sent to the 2019 Charter Revision Commission that attempts to create reforms which would help make sure that payments come in on time by using a “strict time frame.”

“For nonprofit human services organizations, delays in contract registration create administrative headaches but also have real financial costs,” the letter read. It went on to explain that “providers are not paid until the contract is registered so often they have to take out lines of credit or delay payments to third parties while waiting for payment.”

David Greenfield, a former NYC Council member now works as the CEO of the Metropolitan Council on Jewish Poverty. “We’re really asking the Charter commission to resolve a decades-old problem,” he said. Greenfield, who also represented Brooklyn in politics, added that this problem in particular “is becoming more serious because of the fact that the city is now contracting billions of more dollars out.”

The contracts add up to almost $6 billion, spanning over 1,000 nonprofits citywide, according to Greenfield.

“Many of the smaller nonprofits are actually struggling to stay open, and literally have to beg or borrow to pay the bill,” Greenfield said. “And for bigger nonprofits like us, we actually loan money to smaller nonprofits so they can stay in business.”

Greenfield said that hiring and retaining staff can become a challenge when there are uncertainties, especially financial uncertainties, like whether the city payments will come in on time.

“You don’t want to come work for an organization if you’re not sure whether or not you’re going to get paid,” Greenfield said.

The city comptroller is among the most prominent allies the nonprofits have in this effort to change the Charter.

“It’s an outrage and it must stop,” Stringer said. “The city has to start paying its bills within a reasonable time frame and create long-overdue transparency.”

A spokesman for the mayor, Jose Bayona, said New York is already trying to make things easier by putting the process online, through the Procurement and Sourcing Solutions Portal, or PASSPort.

“PASSPort is a technology solution that is designed to create visibility into the contracting process, enhance collaboration and facilitate timely contract registration,” he said.

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