$3.4 Billion in Annual City Contracts — 90% Late

In March, the Pew Charitable Trusts released the most detailed study of Philadelphia’s contracting system I have read. It is 137 pages long. It analyzed more than 12,000 contracts the city signed with nonprofit and for‑profit service providers between July 2019 and January 2025. The team interviewed over 40 city employees across 15 departments and benchmarked Philadelphia against peer cities. The number that came out of it was 90 percent. 90 percent of the city’s contracts with outside service providers are finalized after the work has already begun. More than a quarter of those face delays of five months or more. The contracts cover $3.4 billion a year in city money.

I want to sit with that number for a moment, because it is not a typical “Philadelphia is slow” finding. It is worse than that. It means the city is functionally operating outside its own procurement framework, every year, on more than 2,000 contracts, with no public acknowledgment that this is happening. 90 percent is a steady state. It is the city’s normal mode of operation. The 137 pages are largely an attempt to answer how the city got here.

What “Conformed After the Start Date” Actually Means

The technical term for a finalized contract in Philadelphia procurement is “conformed.” A contract is conformed when both parties have signed, the city has registered the obligation, the encumbrance is in place, and the vendor can be paid for work already done. Until that happens, the work happens on the vendor’s dime.

The Philadelphia Inquirer’s coverage of the Pew report described the consequence plainly. Nonprofits carrying more than 500 open contracts at a time, waiting on $221 million in outstanding invoices. Nonprofits taking out bridge loans to cover payroll. Nonprofits paying interest on those loans — interest that, by the structure of the contracts, is not reimbursable when the city eventually pays. Nonprofits missing payroll, cutting programs, turning clients away. Cynthia Figueroa, the president and CEO of JEVS Human Services, summarized it in a Philadelphia Citizen commentary last month: “90 percent of City contracts over the past five years were finalized after their start date — often requiring organizations to work for months without being paid.”

Five months of work without pay is not a paperwork delay. It is the nonprofit extending credit to the city, on the city’s terms, for the city’s convenience. The city gets the service. The nonprofit gets the risk. The interest on the bridge loan, when it shows up in the nonprofit’s books, is the cost of doing the city’s job.

The asymmetry of this is the part that should make me stop. A large consulting firm can absorb a five‑month payment delay. They have revolving credit facilities. They have retained earnings. They have lawyers on retainer who can pick up the phone and expedite the paperwork. A homeless shelter cannot. A food bank cannot. A youth program cannot. The organizations with the least ability to absorb a five‑month delay are the ones absorbing the five‑month delay. The system asks the smallest actors in the city to bankroll the largest.

The Categories That Get Hit Hardest

The Pew report does not just count contracts. It counts contracts by service type. The pattern in the categories is exactly what you would expect if you understand how the city allocates attention.

The discretionary services — the ones where a city worker has to decide a complaint merits action — are the ones with the worst delays. Homeless services. Behavioral health. After‑school programs. Food security. Workforce development. These are the categories where a nonprofit shows up every day, the city pays (eventually), and the people being served are the most vulnerable Philadelphians. Nonprofits make up roughly 30 percent of the city’s workforce — one of the largest nonprofit employment bases in the country — and the categories they dominate are the categories the city is slowest to pay.

The routinized services are the ones that get conformed on time. Trash pickup. Streetlight repair. Pothole filling. These have the same kind of vendor relationships and the same kind of paperwork, but they have predictable demand and political visibility. The people who design and run the procurement system are also the people who would notice a delayed trash pickup in their own neighborhood.

This is what 90 percent actually means, when you pull the categories apart. It is a system that processes the city’s preferences first and its obligations later.

The Procurement Bottleneck

The Pew report identifies the bottleneck. The Procurement Department does not have the staff to conform contracts on time. It does not have the authority to push back on the departments that send it contracts late. It does not have the metrics or the leadership accountability to make conformance a priority. Pew’s “Managing the High Volume of Contracts” brief lays this out as a structural finding, not a budget complaint: the department was sized for a smaller city, and the gap between its capacity and the actual workload has been the city’s quietest unfunded mandate for years.

This is not a surprise to anyone who has worked with the city. The Procurement Department has been aware of the problem for years. The 2024 Controller’s audit by Christy Brady looked at a related issue — the special‑exemption rule that lets departments award contracts without public bidding — and found $15 million in improperly exempt contracts and $85 million in under‑encumbered contracts in the Department of Behavioral Health and Intellectual disAbility Services. Different topic. Same pattern: departments operating outside the city’s own procurement rules, and the central procurement function not having the leverage to push back.

The Pew report’s recommendations are specific. Empower Procurement to lead the city’s professional services contracting system. Simplify the contract approval process. Build the metrics that would let the public see conformance rates by department. None of this is a moonshot. None of it requires a new law. It requires a Mayor and a Chief Administrative Officer who decide this matters.

Who Is Accountable

The Chief Administrative Officer of Philadelphia is Camille A. Duchaussée. She is the named respondent in the Inquirer coverage, quoted as acknowledging “operational gaps” and the city’s commitment to “strengthening our contracting practices and supporting efficient, transparent and timely service delivery to Philadelphians.” That is a true statement. It is also the same statement the city has been making for years.

The Mayor is Cherelle L. Parker. Her administration has made nonprofit contracting a stated priority. Figueroa’s Philadelphia Citizen commentary, written a month after the Pew report, credited “the Mayor’s Chief Administrative Office” for “a collaboration with the nonprofit sector.” That collaboration is real. It has not changed the 90 percent.

The Procurement Commissioner — the person directly responsible for the conformance bottleneck — is not named in the Pew report, the Inquirer coverage, or the Controller’s audit in a way that would let me responsibly point to one human being. That absence is itself a finding. The accountability for a 90 percent failure rate is diffuse in a way that lets everyone involved disclaim personal responsibility. The 90 percent is a structural outcome of a system no one is personally on the hook for.

The Cost of Doing Nothing

The Pew report did not put a single dollar figure on the cost of the 90 percent. It identified the components: interest on bridge loans. Programs cut because reserves were depleted. Staff turnover because payroll was unreliable. The pattern is consistent enough that I think the most honest read is that every dollar of un‑reimbursable interest paid by a Philadelphia nonprofit on a bridge loan to cover a delayed city contract is a tax levied by the city on the nonprofit. The cost is not borne by the city. The cost is borne by the people who need the services — the kids whose after‑school program missed the first month of the school year, the families whose food bank cut deliveries, the people a homeless shelter could not take in because extending credit to the city had eaten its reserves.

What the 90 Percent Really Is

Philadelphia is not unusual among large American cities. The Pew report’s authors — Bennett Midland, a New York‑based civic consulting firm that has worked with cities on procurement reform — have seen this pattern before. What is unusual is the scale. 90 percent is not the high end of normal delay. It is the highest rate of conformed‑late contracts the firm has documented in a major U.S. city. The 137 pages are an attempt to answer the question of how the city got here.

The report does not have a clean answer. The Pew team reviewed five years of contracting data. They benchmarked Philadelphia against peer cities. The conclusion is that the system is the result of a thousand small decisions — to under‑resource Procurement, to push conformance to the back of departmental priority lists, to treat the bridge loan interest as a “cost of doing business” the city does not have to count — that compound into a 90 percent failure rate on contracts the city has explicitly committed to honor. Each of those thousand small decisions was made by someone. None of those decisions was made by the people who pay the cost.

The Pew report identifies the fix. The procurement bottleneck is named. The recommendations are specific: empower Procurement, simplify the approval process, publish conformance metrics by department. None of it is a moonshot. None of it requires a new law. It requires a budget memo that resizes Procurement for the workload the city actually asks it to carry, and a Mayor who decides this matters. Three months on, the bottleneck is exactly where Pew found it.

Notes, Sources, and Methodology

All quantitative claims in this article come from a single source: the 137‑page report Government Contracting in Philadelphia, released March 24, 2026 by the Pew Charitable Trusts’ Philadelphia Research and Policy Initiative in partnership with Bennett Midland. Pew analyzed more than 12,000 professional services contracts the city signed between July 2019 and January 2025; the 90% figure, the “more than a quarter” delayed five months or longer, the $3.4 billion annual value, the $221 million in outstanding invoices, the un‑reimbursable bridge‑loan interest, and the “more than 500 open contracts” are all Pew as reported by the Philadelphia Inquirer (Anna Orso, March 24, 2026). The “nonprofits comprise approximately 30 percent of the city’s workforce” figure and the direct quote from Cynthia Figueroa are from her April 27, 2026 commentary in the Philadelphia Citizen. The article’s earlier draft attributed the 90% to “a 2024 controller’s audit” — that was wrong. The 2024 Controller Brady audit (Sept 4, 2024) was a separate review of the special‑exemption / no‑bid rule, finding $15.1M in improperly exempt contracts and $85M in under‑encumbered contracts at DBHIDS. Pew’s $3.8B / 2,300‑contracts average across all professional services is broader than the article’s $3.4B figure; the article uses the conservative end.

Pew’s data covers fiscal years 2020 through the first quarter of FY2025. The 90% figure is restricted to professional services contracts, not all city procurement — construction, goods, and other categories are not covered. CAO Camille A. Duchaussée’s “operational gaps” quote and the city’s commitment to “strengthening our contracting practices” are from the Inquirer. Pew’s “Managing the High Volume of Contracts” brief (May 28, 2026) covers the Procurement Department capacity finding the article draws on. Pew’s “Reducing Contracting Delays” brief covers the specific recommendations.

The article’s interpretive claims — that the 90% functions as a tax on small nonprofits, that the system asks the smallest actors to bankroll the largest, that the absence of a named Procurement Commissioner is itself a finding — are mine, not Pew’s. Pew describes a pattern of “operational gaps” accumulated over years, not a deliberate policy. Where the article characterizes intent (e.g., the contrast between routinized and discretionary services), the framing is mine.