The leaders of five New York nonprofit organizations on June 8 urged Gov. Hochul to sign into law legislation when it reaches her desk that would address issues with the state’s contracting system that have delayed payments due nonprofits. The State Legislature last week passed the legislation that originally had been proposed by State Sen. Shelley Mayer and Assemblywoman Amy Paulin, both of Westchester. Similar legislation passed unanimously last year but was ultimately vetoed by Hochul.
A description of the legislation explained that payment delays by New York state on contracts and work orders with nonprofits regularly last for months and, in some cases, more than a year. As a result, not-for-profits are often forced to draw on lines of credit and incur interest costs simply to meet payroll and maintain operations.
It was pointed out that a recent survey by the New York Council of Nonprofits found that 65% of respondents reported concern about funding basic operations in 2025, up from 62% for 2024.
It’s been pointed out that nonprofits are sometimes directed by the state to begin or continue providing services prior to full contract execution, often without clear timelines for invoicing or payment.
The new legislation would establish clearer payment timelines, improve transparency and accountability, expand access to bridge financing, and help prevent minor administrative issues from delaying payments to organizations delivering essential services.
Mayer said, “Our nonprofit organizations are on the front lines every day, providing critical services and support to individuals and families across New York. This legislation will help ensure that nonprofits receive funding in a timely manner by establishing clearer standards, greater accountability, and a more efficient contracting process.”
Paulin described nonprofits as “the backbone of our communities. They deliver essential services and help our most vulnerable residents.”
Kristin Brown, president of the New York Legal Services Coalition Board and CEO of Empire Justice Center said, “For years, providers have been forced to absorb the costs of the state’s inefficient contracting system — taking on debt, draining reserves, and diverting resources away from services while waiting to be paid for work already completed.”
Michelle Jackson, executive director of the Human Services Council said, “By voting to fix this broken system, the state legislature has finally recognized the resilience and worth of these essential professionals.”
According to Jacqueline Ebanks, president and CEO of Nonprofit New York, “At a time when nonprofits are facing growing demand and increasing financial pressure, these reforms will help ensure that organizations can continue providing the essential services New Yorkers rely on every day.”
Both Megan Allen, CEO of the New York Council of Nonprofits and Jan Fisher, executive director of Nonprofit Westchester, expressed thanks to the Legislature for passing the legislation and urged Hochul to sign it into law.
