Comptroller's Report Recommends Changes

DiNapoli recommends changes to expedite nonprofit contracts
Tuesday, March 30, 2010, 2:58pm EDT Modified: Tuesday, March 30, 2010, 4:00pm
The Business Review (Albany)

Nonprofits in New York state are being hit especially hard by the recession, as demand for their services is on the rise while fundraising is on the decline, according to a new report.

State Comptroller Thomas DiNapoli said 87 percent of nonprofit contracts valued at more than $50,000 each were not approved by the state prior to the work starting. An audit found that 5,260 contracts out of 6,033 contracts, worth $2.7 billion, took an average of 184 days for approval. New contracts were, on average, approved almost nine months after the contract start date.

DiNapoli said as of June 2009, New York has 31,000 active contracts with not-for-profits worth $14.6 billion.

The comptroller added other problems hurting nonprofits include a decline in charitable giving and a drop in endowments for philanthropic foundations by 29 percent between 2007 and 2008.
"You have a situation where obviously the social, economic and health needs have risen dramatically, especially during the time of recession and unemployment," said Doug Sauer, CEO of New York Council of Nonprofits Inc. "When a for-profit has more customers, they make more money. Nonprofits have more customers,more demand, but you have less resources to meet that."

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