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Nonprofit Groups in 19 States Report Late Government Payments

April 29, 2009, 8:56 pm

Nonprofit social-services groups in 19 states said in a recent survey that payments from state or local governments have been received later than they were due, in some cases forcing charities to cut jobs or services.

“Agencies experiencing delayed payments all reported negative impacts on their organizational cash flow,” says a report on the survey, which was conducted by the Alliance for Children and Families and United Neighborhood Centers of America, two national social-services umbrella groups.

Ninety-six nonprofit groups from 30 states responded to the survey distributed this month, which asked whether they had received late payments from government agencies for work done under grants or contracts.

“Delayed payments have forced many of these nonprofit agencies to tap existing lines of credit,” the report says. “However, many report that these lines of credit have been cut back, or that it has become more expensive to borrow against them.”

The report, which is available online, lists survey results by state. Among those reporting problems:

  • Four groups in California said payments from the state and some high-school districts were delayed from two-and-a-half months to almost 18 months, affecting programs in areas including child development, education, and mental health. The problem is aggravated because the state suspends contract payments when lawmakers cannot agree on a budget.
  • Three groups in Florida said payments from the state and the city of Clearwater were delayed from four months to more than a year, with Medicaid payments a particular problem. The delays affected programs in areas including family counseling, sexual assault, and children’s mental health.
  • Four groups in Michigan said payments from the state and some counties were delayed from 45 days to six months, affecting domestic-violence, mental-health, and housing programs.
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