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A 10741

Relates to contracts between state agencies and not-for-profit organizations

2025 Regular Session Introduced by Michael Cashman and 11 co-sponsors

Aims to accelerate and standardize state contracts with not-for-profit organizations, including interim service start with written directives and a revolving loan fund to support N

SUBSTITUTED BY S9761
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Bill Summary · A 10741

Summary of Bill A. 10741 (2025-2026) – New York

Purpose and intent

The bill authorizes and regularizes contracts between New York state agencies and not-for-profit organizations (NPOs). It clarifies definitions, streamlines contract execution and approval timelines, facilitates interim service provision under written directives, strengthens access to a short-term revolving loan fund for NPOs, and enhances advisory oversight and reporting.

Key provisions

  • Definitions and directives (Sections 1 & 2)

    • Redefines “Renewal contract” to include continuations of existing contracts and new contracts for the same or similar services, with services deemed similar if they are comparable to prior contracted work.
    • Defines “Written directive” as a state agency directive allowing an NPO to begin or continue services during contract negotiations, including:
    • A schedule for invoicing and payment dates.
    • A disclosure that payment depends on appropriations, contract/renewal execution, and comptroller/AG approval.
    • Instructions to access the not-for-profit short-term revolving loan fund (see below).

  • Contract execution timelines and AG/Comptroller review (Section 2)

    • Agencies have up to 150 days after the latest applicable appropriation date to execute contracts with NPOs.
    • After execution, contracts go to the Attorney General for a 15-day review; if approved, they proceed to the Comptroller for a 15-day approval/file process.
    • If an agency issues a written directive to begin services before full execution, it must outline payment and invoicing schedules.

  • Not-for-profit revolving loan fund and loan terms (Section 3)

    • The State Comptroller may provide interest-free loans from the not-for-profit short-term revolving loan fund to NPOs receiving a written directive.
    • Loans require a reasonable repayment agreement satisfactory to the Comptroller, may be prorated over the contract term, but cannot exceed one year.
    • Loan amount cannot exceed half of the subject contract’s first-quarter payment (as currently drafted phrasing suggests; the bill uses bracketed language for a potential numeric limit).
    • Recipients of such loans are ineligible for certain advance payments and related provisions.
    • Agencies must supply instructions on accessing the loan fund to every NPO that receives a directive, contract, or renewal contract; information must be publicly posted by the Comptroller and the New York State Nonprofit Unit.

  • Advisory committee (Section 4)

    • Establishes a 16-member Not-for-Profit Contracting Advisory Committee (NFP Advisory Committee) with:
    • 8 appointed members ( Governor-appointed, including not-for-profit representatives; additional appointments via Senate/Assembly recommendations).
    • 8 ex officio members from key state offices (Budget, Law, Comptroller, Education).
    • Duties include: quarterly meetings, advising on loan fund implementation, evaluating standard contract language usage, reviewing statewide financial system improvements, and annual reporting with recommendations.
    • Annual, public-facing reporting due by December 1.

  • Contracting and payment standards (Section 5)

    • Updates to sections of existing law regarding audit triggers, payment timing, and defect/impropriety inspection windows.
    • Clarifies timelines for agencies to notify contractors of defects or issues and how such defects affect payment timelines (with specific protections for small businesses).

Who is affected

  • State agencies that contract with NPOs for services.
  • Not-for-profit organizations receiving directives, contracts, or renewal contracts, including those utilizing the revolving loan fund.
  • The state's not-for-profit sector through the advisory committee and enhanced transparency.
  • Public agencies (OG, AG, OMB, NY Nonprofit Unit) involved in contract oversight and reporting.

Timelines and effective date

  • The act would take effect 180 days after becoming law.
  • It establishes multi-stage approval (AG then Comptroller) after contract execution and specifies interim directives for pre-execution service start with defined payment and invoicing procedures.

Potential impact

  • Aims to accelerate and standardize contracting with NPOs, including interim service commencement via written directives.
  • Provides a formal mechanism (not-for-profit revolving loan fund) to support cash flow for NPOs during contract negotiation and execution.
  • Enhances oversight, accountability, and transparency through an advisory committee and public reporting.
  • Seeks to balance timely services to the public with prudent financial controls and statutory appropriation dependencies.

Compiled from official sources — confirm details with the bill’s official record.

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