Nonprofit funding battle continues over procurements issue

As the final leg of the New York City budget process gets underway, human services nonprofits are well positioned to win several important funding victories though falling short on a broader collective struggle to secure better contracting terms with the city.

The proposed $89 billion executive budget unveiled by Mayor Bill de Blasio on April 26 includes an additional $31 million to save the Close to Home program, $150 million more to battle homelessness, and a $30.5 million increase to child literacy programs. But the budget does not include a $200 million increase requested to help meet increased operating costs to human services contractors. Nonprofit leaders have signaled that they are not done fighting for it.

Such a funding boost would ideally follow the $300 million the mayor added last year to help nonprofits better cope with increasing costs and wages. Fully funding this $500 million plan remains a top unfulfilled budget demand, according to the Human Services Advancement Strategy Group.

“Key investments must be made on human services contracts as a whole so that providers can deliver quality services to our communities,” reads an April 30 statement from the coalition of approximately 2,000 organizations.

But that issue has to compete with other prominent issues in the budget process, including the New York City Housing Authority, the Metropolitan Transit Authority, and the ongoing feud between de Blasio and Governor Andrew Cuomo.

Funding gaps in the approved state budget also forced the city’s hand on several fronts including juvenile justice. A complete state withdrawal of funding for Close to Home came as the city races to implement Raise the Age legislation.

The latest executive budget includes $31 million for Close to Home, on top of $108 million added to place youthful offenders in more age-appropriate facilities as part of the effort to implement Raise the Age by Oct. 1 this year. De Blasio said at a press conference unveiling the budget that the city was on the hook for an extra $530 million after Cuomo signed his budget about a month ago.

The next day he said on WNYC’s The Brian Lehrer Show that a proposed $386 million spike in funding to counter homelessness would be the last funding increase needed on the issue.

“We believe based on the projections that we have that this is the last big expenditure on the way to restructuring the system and then starting to reduce costs,” he said.

That money would fund the transition away from housing the homeless in cluster site housing – essentially private apartments rented by the city on behalf of homeless families – by diverting them to hotels. This strategy is dependent on mega-contracts with nonprofits – some with less-than-proven track records.

His latest budget proposal also included more funding for other social services, including $30.5 million to promote universal literacy and $1.9 million to provide a mobile trauma response unit in every borough through the Cure Violence program.

The City Council will hold hearings on the executive budget before the budget’s final June 5th deadline. The new fiscal year then begins on July 1.  

As the calendar ticks forward, President Trump has become a powerful force wielded by nonprofits in their bids for more funding. A rally this week in front of City Hall brought together a coalition of groups opposed to proposed cuts to federal social programs such as SNAP. With the state budget finalized, the city must pick up any gap in funding created by Trump – who recently signaled states could implement work requirements for some benefits. Otherwise, the most vulnerable New Yorkers will ultimately pay, Wayne Ho, executive director of the Chinese-American Planning Council, said in a telephone interview.

“I think there is more pressure and urgency with everything going on at the federal level," he said.