The New York City Mayor’s Office of Nonprofit Services recently convened a meeting with City Hall leadership, department commissioners, and nonprofit leaders to discuss progress in ensuring timely payments to nonprofits contracted with the government. Historically, the city faced significant delays in “registering,” or paying, these contracted organizations, resulting in a backlog exceeding $11 billion. These nonprofits deliver essential programs on the city’s behalf, such as providing social services to families in need.
As the beginning of the year, the office has utilized a new performance tracking tool, contractstat, and conducted surveys to assess nonprofit experiences working with the city. Results shared with city officials demonstrate that these efforts have contributed to a ample reduction in the unpaid contract backlog – from over $11 billion in 2022 to under $3 billion currently.
Mayor’s Office of Nonprofit Services Executive Director Michael Sedillo discussed this improvement with City & State. This interview has been edited for length and clarity.
How has the city’s nonprofit contract payment backlog changed since 2022?
We’ve focused on five key indicators, developed in partnership with chief nonprofit officers in every city agency, to measure our performance in paying nonprofit providers on time. These indicators focus on contract backlog, invoice cycle time, budget modification cycle time, and provider sentiment. A contract is considered backlogged when it hasn’t been registered despite services having already begun. Unregistered contracts cannot be paid, and historically, this has been a primary driver of payment delays.
When this administration began, the backlog of retroactive and unregistered contracts exceeded $11 billion. I’m pleased to report that, thanks to the dedicated work of city agency staff, that number has been reduced by 81%. Specifically, since we began tracking this regularly from the Mayor’s Office of Nonprofit Services earlier this year, the backlog has decreased by 52%.
How does ContractStat help the office monitor contract registration performance, and what is the benefit?
ContractStat is a performance management tool designed to focus agency leadership and chief nonprofit officers on key indicators related to timely payments. We’ve been reporting these metrics monthly to our non-city agency partners since February. More broadly, it fosters alignment across our bureaucracy. With hundreds of thousands of employees, it allows the administration to prioritize this issue and clearly communicate accountability to city agency staff. Having dedicated chief nonprofit officers is crucial for achieving this alignment.
So far, what has the Quarterly Provider Sentiment Survey shown the office? How has this details been used?
We launched the provider sentiment survey this year, shortly after I started in January, to gather direct feedback from our partners. While quantitative data is critically important,qualitative data is equally valuable. We need to be responsive to our customers – our nonprofit providers – and ensure a positive experience. The anonymous survey allows providers to share their experiences with city agency staff and helps us identify areas for improvement.
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