Many contractors that do work on behalf of the city are waiting months to get paid as city agencies struggle to submit registration documents on time, according to a report.
The Annual Contracts Summary Report, which analyzes trends in procurement, said there is a longstanding and growing problem of the slow submission rate by city agencies. The percentage of contracts registered late grew from 52% in FY21 and FY22 to 66% in FY23, and to 77% for the first half of FY24. These delays cause vendors to wait longer for payment and particularly hurt nonprofits, human service providers, and minority and women-owned business enterprises (M/WBEs).
According to the report issued by the city Comptroller's office, the city entered into 12,820 new procurement and revenue contracts in FY 2023, valued at $38.22 billion.
“We expect our vendors to provide services on time, so we should pay them on time,” said Comptroller Brad Lander. “It’s especially egregious that our non-profit human service providers – who provide meals to home-bound seniors, shelter for homeless New Yorkers, child care for our kids, and so much more – and our minority and women-owned businesses (M/WBEs) wait so many months, many of them even more than a year, just to get paid for services they provided long ago. Speeding up the contracting process is necessary to help New Yorkers benefit from efficient and effective City services.”
For the first half of FY24, human services agencies delayed the registration of contracts containing over 95% of the total contract value for nonprofit organization and human service providers, a significant increase from prior years. Agencies submitted many of these contracts for registration extremely late. In FY23, more than 27% (1,218) of the contracts with non-profit vendors were registered six months to one year late and 31% (1,388 contracts) more than a year late, due to late submissions by agencies.
For years, the city’s procurement process caused considerable registration delays that hinder the ability of many of its vendors to get paid on time. City Hall originally committed to launch ContractStat, a performance management and transparent reporting system by June 2023, but has yet to launch it.
