New York’s Child Victims Act gave the survivors of childhood sexual abuse the ability to seek justice through the provision of a two-year window during which they could bring civil lawsuits against their abusers regardless of their age or the statute of limitations. More than 10,857 lawsuits were brought under the legislation which, after a delay, are now making their way through the court system. Although this is a positive development, the act poses an existential and unintended threat to the nonprofits that constitute New York’s child welfare system.
Although the majority of CVA lawsuits concern religious institutions, child welfare nonprofits face approximately 15% of the total cases. Our new research report – The Child Victims Act: Serving Justice While Limiting the Collateral Damage – demonstrates that these nonprofits have very limited financial capacity to bear the costs associated with the Child Victims Act lawsuits. Without support from policymakers, they are at risk of either discontinuing essential services or failing completely.
These organizations are the backbone of New York’s child welfare system, providing over $2.3 billion in foster care and prevention services to close to 90,000 children. They are largely government funded (over 90% of their revenue), reflecting that child welfare nonprofits are important partners to government. These nonprofits are also a large employer, paying $1.8 billion in salary and benefits to more than 41,000 staff, largely women and people of color.
Although New York City argues that it has no “special duty” to protect victims, and New York State is dismissing cases on the basis that victims cannot recount the exact time and place of the abuse, the government must take steps to reduce the collateral damage from the legislation while ensuring justice for survivors. First, policymakers should fast-track the proposed Child Victims Act Fund to help nonprofits pay the uninsured costs of lawsuits. Second, they should ensure that insurance is both available and affordable by allowing nonprofits to participate in government-supported insurance programs.
Child welfare in New York has always been a public-private partnership, where the government fulfills its legal mandate to protect vulnerable children by placing them with mission-driven nonprofit agencies. If the system is unable to continue functioning because of the act, policymakers should be prepared for the financial, political, and moral fallout when multiple nonprofits collapse, putting vulnerable young people and staff at risk and imposing additional costs on taxpayers as the government is forced to execute its duty in a less efficient way. While justice requires that victims of past abuse receive restitution, it also requires that reasonable steps be taken to reduce the harm imposed on others. The clock is ticking.
John MacIntosh is managing partner and Ananya Poddar is an associate at SeaChange Capital Partners.