New York City spends $8 billion a year on social services like homeless shelters, addiction programs and senior centers \u2014 billions more than it spends on its police department.<\/p>\n
The Department of Social Services, for example, cuts sizable checks each year: nearly $660 million to the Institute for Community Living and about $600 million to RiseBoro Community Partnership, for post-shelter affordable housing.<\/p>\n
The Department of Health and Mental Hygiene has funneled more than $1.2 billion to Public Health Solutions.<\/p>\n
The Department of Homeless Services just ballooned its deal <\/a>with the Hotel Association of New York to a staggering $1.9 billion over the next three years.<\/p>\n So what are we getting for all that money?<\/p>\n We have no idea.<\/p>\n Under the current system, NYC doesn\u2019t pay the nonprofit contractors that provide these services for results.<\/p>\n It pays them for expenses: rent, salaries, office supplies and so on.<\/p>\n As long as the paperwork checks out, the check gets cut.<\/p>\n It doesn\u2019t matter if the shelter helped keep someone off the street.<\/p>\n It doesn\u2019t matter if the addiction program got anyone clean.<\/p>\n It doesn\u2019t matter if the job training led to a job.<\/p>\n Get selected as the service provider, spend the money, do the work, file the forms, get paid.<\/p>\n Instead of asking \u201chow can we stop drug addiction?\u201d the city asks, \u201chow many social workers are working?\u201d<\/p>\n No penalty for failure is built into this system.<\/p>\n A nonprofit can burn through its entire contract, produce minimal results for the community and still be made whole by the taxpayer.<\/p>\n That\u2019s not a bug \u2014 it\u2019s how the system operates.<\/p>\n And it means there\u2019s zero structural incentive for any contractor to do anything more than comply with the paperwork.<\/p>\n Worse yet, because the city is paying for expenses rather than outcomes, it must verify every single expense.<\/p>\n That means extensive oversight, mountains of paperwork and a contracting system so slow that it often takes multiple years simply to begin work.<\/p>\n The mayor\u2019s own Office of Contract Services acknowledged back in 2019 that this system has no built-in mechanism to hold providers accountable for results.<\/p>\n Six years later, little has changed.<\/p>\n Here\u2019s what that looks like in practice: Last year, more than 90% of human-services contracts were registered late.<\/p>\n Some nonprofits waited over 200 days after starting work to receive their first payment.<\/p>\n At the Department of Housing Preservation and Development, the average wait was 765 days \u2014 that\u2019s over two years without payment.<\/p>\n City Hall has proposed some solutions, including an improved dashboard to track the delays, more bureaucratic staffing and a mechanism to enable partial payments.<\/p>\n These aren\u2019t terrible ideas, but they\u2019re patches on a broken system.<\/p>\n There\u2019s a proven alternative.<\/p>\n It\u2019s called performance-based contracting, and New York City already uses it \u2014 for charter schools.<\/p>\n Charters get public money based on their enrollment, and renewals are tied to student outcomes.<\/p>\n Deliver results, keep your funding; don\u2019t deliver, lose your charter.<\/p>\n \t\t\t\t\t\t\tGet opinions and commentary from our columnists\t\t\t\t\t\t<\/p>\n \n\t\t\t\t\t\t\tSubscribe to our daily Post Opinion newsletter!\t\t\t\t\t\t<\/p>\n \t\t\t\t\t\tThanks for signing up!\n\t\t\t\t<\/p>\n It\u2019s simple, and it works: City charter-school kids consistently outscore their peers<\/a> on state tests.<\/p>\n That model should apply to nonprofits across the board.<\/p>\n Give them enough upfront funding to get started, then tie the rest to real results \u2014 people housed, people employed, people in recovery.<\/p>\n Did it work? Get paid.<\/p>\n Didn\u2019t work? Don\u2019t.<\/p>\n This approach does something the current system never could: It removes the need for overbearing administrative oversight while giving contractors a reason to perform.<\/p>\n Right now the city spends enormous resources verifying that money was spent correctly without real needs being met.<\/p>\n Under a performance model, it would spend those resources verifying that people were actually helped \u2014 a better use of everyone\u2019s time.<\/p>\n Other states have already figured this out: Illinois and Kansas have both used performance-based models for human-services contracting, with real results.<\/p>\n The Mayor\u2019s Office of Contract Services took a step in the right direction this year when the Department of Correction<\/a> introduced the Challenge-Based Procurement model to award contracts for education and other inmate assistance programs.<\/p>\n While funding is not yet directly tied to results, the new approach shifts the focus away from bureaucratic process \u2014 and that\u2019s meaningful progress.<\/p>\n Yes, measuring social-service outcomes is harder than measuring test scores, and some of the people these programs serve face challenges no contractor can fully fix.<\/p>\n A badly designed metric could end up punishing organizations doing hard work in hard circumstances.<\/p>\n