Philly nonprofits are lobbying against a controversial contracting bill as City Council is set to vote

One of the top Democrats on City Council is moving forward this week with a controversial bill that would change the way the city works with nonprofits, despite a last-minute lobbying campaign against it and fierce opposition from some of the city’s charitable organizations.

Majority Leader Katherine Gilmore Richardson authored legislation that would end the city’s practice of hiring nonprofits to perform city work without going through the usual competitive bidding process.

She has cast the change as a needed shift that will yield greater transparency in government spending following revelations that the city’s Office of Homeless Services contracted with nonprofits it didn’t have enough money to pay.

But nonprofit leaders have expressed fear that the change could hurt their bottom lines. On Wednesday, just a day before Council was scheduled to vote on the bill at the final meeting before its summer break, some Council members were being inundated with calls about the legislation.

» READ MORE: Overspending in Office of Homeless Services could prompt change to Philly’s contract process

At least four members have spoken to Gilmore Richardson’s office about delaying the bill until Council returns in the fall, according to two sources who requested anonymity because they were not authorized to discuss internal deliberations.

However, Gilmore Richardson said she is pressing on. Her office confirmed Wednesday that she intends to move forward with the bill Thursday and will introduce companion legislation to establish a task force that will study how the city contracts with nonprofits.

In an email to other Council members Wednesday, Gilmore Richardson said her goal is to ensure the city’s contracting process is fair to all organizations, regardless of whether they have a preexisting relationship with a city agency.

“I know change is hard, but change is necessary,” she wrote in the email, which her office shared with The Inquirer. “If we want to create equitable rules for accountability and improve the way we do business, we must ensure there is an equal playing field for all.”

Gilmore Richardson noted she has met twice with dozens of leaders from the city’s nonprofit sector to hear their concerns and feedback.

During one of those calls this week, some leaders pushed Gilmore Richardson to delay the bill so they could try to find a compromise over the summer.

“There may be some ways to improve the bill if you wanted to target the Office of Homeless Services or some portion of the contracts,” said Andy Toy, policy director at the Philadelphia Association of Community Development Corporations. “Maybe we can amend it and make it better. But the way it is now, many people think it’s a bad idea.”

» READ MORE: Philly City Council advances controversial contracting bill that Mayor Parker’s administration opposes

Much of their concern comes down to resources.

Cherie Brummans, president and CEO of the Alliance of Community Service Providers, which represents dozens of mental and behavioral health providers that contract with the city, said many of the city’s nonprofits don’t have the staffing or capability to go through the city’s typical procurement process to get city contracts.

She said forcing them to do so would disadvantage smaller organizations — even those that have long-standing relationships with the city.

“Our providers will have to dedicate considerable staff time to the administrative [request for proposals] process,” she said. “That’s going to increase overhead costs.”

That campaign to delay the bill comes alongside opposition from members of Mayor Cherelle L. Parker’s administration. When the legislation was considered by Council’s Finance Committee last week, 11 administration officials submitted testimony saying the change would significantly burden city operations and make it more difficult for agencies to respond to emergencies.

The bill passed out of committee unanimously.

Gilmore Richardson has publicly acknowledged the opposition to the legislation and said she has made changes based on feedback from nonprofits.

During one meeting last week, nonprofit leaders said they could not plan their budgets for this coming fiscal year without knowing whether their contracts with the city would be renewed. Gilmore Richardson amended her bill so that it will not take effect until July 2025.

In her message to other Council members, she said the introduction of legislation to create the task force also came at the recommendation of nonprofit representatives.

“My only goal in this work,” she wrote, “is to create overall improvements to the way the city does business and to ensure that there are equitable, transparent, and accountable procedures that allow all organizations — regardless of size or relationship — to have the opportunity to provide high-quality service.”