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Nonprofits continue to face challenges with delayed NYC contract registration

April 18, 2019

SeaChange Capital Partners report on NYC nonprofit contract delays

SeaChange Capital Partners has a new report on nonprofit contracts. There is a full breakdown of the report from partner John MacIntosh, but here are the top takeaways:

Over the years, SeaChange Capital Partners has been approached by numerous nonprofits pushed to the brink of financial calamity while waiting to get paid by New York City. Last year we analyzed the financial burden from contracts registered in Fiscal 2017. Thanks to new data provided by the Office of New York City Comptroller Scott M. Stringer, we’ve now updated that analysis for Fiscal 2018 in New York City Contract Delays: Vol 2.

The short story is that things remain bleak:

  • The 2,543 social service contracts registered in 2018 were an average of 221 days late (11 days longer than in 2017); the odds that a contract was registered on time was 11 percent (2% better than in 2017); and 20% remained unregistered after a year (unchanged since 2017).
  • Organizations could only be “pretty sure” (i.e. 80%) that a contract would be registered after 369 days and could only be “really sure” (i.e. 95%) after 623 days.
  •  The 1,000+ discretionary awards – which represented 40%of all contracts but only 3% of the value – were by far the latest: The median delay was 304 days and nonprofits could only be “really sure” that a discretionary award would be registered after almost two years of waiting.
  • Renewals were the fastest: a full 36% of renewals were actually registered before the start date and the median delay was only 25 days though organizations still needed to wait nine months to be “really sure” that a renewal would be registered.
  • The total cash flow burden imposed on all nonprofits due to registration delays in 2018 was $744 million (up from $675 million in 2017)

See the full report here:

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