Albany, NY – Assemblywoman Amy Paulin (D–New Rochelle) and State Senator Shelley B. Mayer (D–Westchester) announced the passage of their bill, A.7616/S.7001, in both the New York State Assembly and Senate — an urgently needed victory for New York’s nonprofit sector and the millions of residents who rely on its services. The bill, which now awaits the Governor’s signature, reforms New York’s Prompt Contracting Law to ensure nonprofits are paid on time, treated fairly, and equipped to continue delivering essential safety net services across the state.

Nonprofits in New York provide critical services on behalf of the state — early childhood education, mental health counseling, housing for the homeless, substance use treatment, legal services, and more. Yet the current state contracting system has too often undermined their ability to operate, with chronic delays, inconsistent processes across agencies, and reimbursement lagging for months — sometimes over a year.

A recent survey found that 33% of nonprofits holding contracts with New York State were owed more than $58 million for services already delivered. When extrapolated statewide, the amount owed to nonprofits exceeds $650 million — money that has already been appropriated but not paid. These delays force nonprofits to drain their reserves, take out loans to meet payroll, and in some cases, scale back or shut down programs.

Assemblywoman Paulin and Senator Mayer’s bill introduces long-overdue reforms, which would:

• Improve consistency in contracting across all agencies.
• Streamline contract renewals and improve timeliness.
• Clarify when nonprofits can expect payment schedules and ensure interest on late payments.
• Ensure automatic contract advances so that nonprofits do not have to take on unsustainable debt to front costs for essential services.
• Recognize and reimburse the real cost of delivering services, including overhead.
• Ensure nonprofits are not being penalized for minor errors in vouchers.

“These nonprofits are doing the State’s work — feeding the hungry, housing the homeless, helping our most vulnerable residents — and we’ve been asking them to finance that work themselves while waiting for overdue payments,” said Assemblywoman Paulin. “It’s unsustainable and unacceptable. This bill provides the structure, fairness, and predictability that nonprofits need to stay afloat and serve the people who depend on them.”

The bill also ensures nonprofits aren’t penalized for minor administrative errors in vouchers and recognizes the real cost of delivering services, including overhead expenses.

State Senator Shelley B. Mayer said, “I am very pleased that my colleague, Assemblywoman Amy Paulin, and I have successfully passed this bill to support our not-for-profit organizations in both the Assembly and Senate this session. Our not-for-profit organizations provide essential support, resources, and services to all of our communities. However, for years, they have had to navigate complex contractual processes to receive timely and contractually required reimbursements from state grants. This creates tremendous fiscal and operational problems, ultimately limiting the quality and quantity of services they can offer to those in need. This bill finally addresses these problems by clarifying and streamlining the reimbursement process. Thank you to Nonprofit Westchester for their strong advocacy to find a legislative solution to this problem. Now I urge Governor Hochul to sign this legislation as soon as possible.”

Jan Fisher, Executive Director of Nonprofit Westchester, applauded the bill’s passage: “This legislation is not just about streamlining bureaucracy — it’s about ensuring the survival of New York’s nonprofit sector at a time when it's needed most. Nonprofits are being destabilized by state delays just when our communities are relying on us to provide critical safety net services and defend civil rights in an uncertain federal landscape. These reforms recognize that we are partners — not afterthoughts — in delivering life-saving services.”

As more nonprofits report difficulty recruiting and retaining staff due to financial instability, this legislation offers timely and targeted solutions that will help safeguard the continuity of essential services.

“With this bill, we’re not just supporting nonprofits,” said Paulin, “we’re supporting the families, children, seniors, and communities they serve.”