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Q&A
Nonprofit contracting and payment delays
0:44:51
ยท
5 min
Council Member Diana Ayala raises concerns about nonprofit contracting and payment delays. Commissioner Molly Wasow Park acknowledges the challenges and outlines DSS's efforts to address these issues.
- DSS relies heavily on nonprofit partners for service delivery
- Payment delays are due to various factors, including invoice processing, budget modifications, and subcontractor approvals
- DSS is working closely with providers to expedite payments on an emergency basis
- The department is also addressing structural issues to improve the process going forward
- There's no single report or summary of all contracting and payment delays due to the complexity of the issues
Diana Ayala
0:44:51
Yeah.
0:44:51
It's really scary, but it's heartbreaking.
0:44:53
I mean, at a time when we're facing the largest number of unhoused individuals and shelter, food insecurity continues to climb.
0:45:02
Like this is a really big deal.
0:45:05
And I think that we all need to be paying attention to what's happening in our Absolutely.
0:45:10
Nonprofit organizations provide community based human services on behalf of the city to most vulnerable residents.
0:45:18
This is especially true for HRA and DHS.
0:45:21
DHS contract budget totals 3,700,000,000.0, which is over 85% of the agency's budget, largely related to shelter services.
0:45:29
HRA's contract budget is 9 point 922,800,000.0 and includes programs such as domestic violence shelters, workforce development programs for cash assistance clients, and food pantries.
0:45:42
Many nonprofits are struggling because city contracts do not keep up with the actual cost of providing services and payments are often delayed.
0:45:49
In October of twenty twenty four, MOX launched a payback, backlog initiative focusing on clearing outstanding payments from fiscal twenty three to '25.
0:45:59
How is DSS working with MOX to ensure that providers are receiving their outstanding payments and what is DSS doing to expedite the contracting and payment timeline for these nonprofits?
Molly Wasow Park
0:46:09
Thank you for that.
0:46:11
Let me start by saying we can't do the work that we do without our not for profit partners and we understand absolutely that the not for profits can't do their work if they don't get paid.
0:46:22
We are in a challenging place right now.
0:46:24
It has been a difficult process on those payments but it's something that we are very, very focused on.
0:46:32
I will say it's a very complicated and nuanced issue.
0:46:37
When a provider's the provider's experience of I am not getting paid actually translates back to a number of different challenges on the city side of things.
0:46:47
It may mean that there's an invoice, we have received an invoice and we haven't processed the invoice.
0:46:53
It could also mean that there's a budget modification that needs to be done.
0:46:56
It could mean that there is a subcontractor approval that needs to get done.
0:47:01
There's a variety of other issues.
0:47:03
So what we are doing is really looking holistically at all of that and trying expedite payments on an emergency basis, but we're working very closely with providers.
0:47:16
DHS in particular is meeting one on one with every single provider that we have, but we're also looking at structural issues so that we can make this better going forward.
Diana Ayala
0:47:27
Does DSS have an accounting of all nonprofit contracting and payment delays?
Molly Wasow Park
0:47:32
Because as I say, the issue of not getting paid is actually reflection of so many different issues.
0:47:40
It's not possible to create a single report or summary that says here's everything that's at issue or here's the total dollar value at issue because in there could be new needs that aren't yet they're very real to the provider but they haven't yet been approved through the process so they wouldn't show up on any report.
0:48:02
We're looking holistically but no I can't put a single figure on it.
Diana Ayala
0:48:07
I'm just trying to figure out where the immediacy is in trying to resolve these issues because the truth is that a lot of these nonprofits are already working with bare bones and they're not able to make payroll, know, and that's that's also very concerning because we're we're talking about primarily black and brown individuals that are working in our social service agencies and we want to be able to ensure that they're paying rent and that they're able to purchase food and take care of their families.
0:48:42
So how do we you know I'm just trying to figure out I get I get that you know I mean these things are unpredictable and that for a variety of reasons, these contracts can be delayed, but the but the fact that they're already seriously underfunded and then on top of that they have a delay and many of them don't have the cash flow on hand, which I'm sure council member Brewer is gonna get to you in a little about.
Molly Wasow Park
0:49:04
We are absolutely approaching this with urgency and as I say it's really a two track effort so that we are What do we need to do to get cash into people's hands today and working very closely with the not for profits in very regular communication so that we don't want to get anybody to the point where they can't make payroll so that we're addressing issues in a real time basis working hand in glove with the providers, but then also trying to tackle all of these more systemic issues so that next year we are in a better place.
Diana Ayala
0:49:39
Yeah.
0:49:40
Yeah, I mean we need a better system.
0:49:46
Do you know what average delays and number of days is that providers are seeking in the contract registration and payment process?