“This is life-changing work that we all agree is necessary to keep New York families safe, housed, and together,” the authors write. “Yet, year after year, the city becomes increasingly late in making contract payments.”
In a year of deep funding uncertainty, the new Mamdani administration must make one issue an immediate priority: fixing New York City’s chronic delays in paying nonprofit contractors.
For more than a decade, the city has been late paying the legal services providers it relies on to protect its most vulnerable residents. As a result, organizations like ours are forced to subsidize public services with private dollars, lines of credit, and reserves—jeopardizing our financial stability and our missions.
We’re talking about city contracts to represent tenants facing eviction in housing court through NYC’s landmark Right to Counsel program, families facing landlord harassment and dangerous living conditions that threaten the safety and health of their children, and immigrants who fled violence and are fighting for stability in the U.S.
This is life-changing work that we all agree is necessary to keep New York families safe, housed, and together. Yet, year after year, the city becomes increasingly late in making contract payments, forcing us to shoulder additional debt by taking out loans to make payroll and sustain operations, threatening our very existence.
We are nearly three months into 2026 and city contract payment delays have not improved. We can no longer afford to wait.
New York City currently owes Legal Services NYC nearly $30 million for Fiscal Year 2025 and FY2026—more than 20 percent of its annual budget. We have maxed out $15 million in lines of credit to cover payroll and paid over $600,000 in interest alone—money we will never recover. That $600,000 equals roughly 400 cases we could not take because we were forced to finance the city’s delays.
For smaller organizations like TakeRoot Justice, the total owed may be less, but the impact is just as severe. TakeRoot is currently owed $2 million from FY2024 through FY2026—about 20 percent of its annual budget. TakeRoot coordinates citywide coalitions of legal services providers and community-based organizations delivering frontline services under city contracts, and each of them is facing the same financial strain caused by the city’s chronic contracting and payment delays.
With so much on the line for so many New Yorkers, and amid lingering budget deficits and continued cuts to federal funding, it is critical that the city fix its contracting issues once and for all.
New York City’s contracting failures are hardly new, but every mayoral administration must work to fix them if the city is serious about tackling its affordable housing crisis and street homelessness, supporting immigrant communities, and preventing its most vulnerable residents from falling through the cracks.
The scale of the problem is undeniable. Last year, the New York City Comptroller reported that NYC had 7,000 unpaid invoices totaling more than $1 billion—about 4,000 of them, worth $861 million, owed to nonprofits alone.
That’s an astonishing amount to withhold from nonprofits contracted to perform live-saving work, and as the Comptroller points out, it ultimately punishes New Yorkers who are not able to access our services as a result.
We and other legal service providers have proposed clear solutions to the NYC Council Committee on Contracts at a hearing last month: increase contract processing staff; provide transparent, consistent budget instructions across agencies; offer realistic approval timelines; issue larger advances at the start of the fiscal year; and reimburse nonprofits for interest paid on loans taken out solely because of city delays.
These are practical, achievable reforms, but the city must start to act on them.
New York City and legal services providers share the same mission: to keep families housed, to protect immigrants, and to ensure equal access to justice for every New Yorker. We are proud partners in that work. But partnership requires reliability and accountability.
At a time of mounting need and fiscal strain, the city cannot continue to destabilize the very organizations carrying out its priorities. It is time to clear the backlog, implement structural reforms, and build a contracting system worthy of a city that calls itself a City for All.
Shervon M. Small is executive director of Legal Services NYC.
Keriann Pauls is interim executive director of TakeRoot Justice.