First of all, where does $row come from ?
Shouldn't it be $contact ?
Second, you use extracted values, i.e. you defined $is, $folder, ...
So ...
echo "<option value=\"{$row['folder']}\">{$row['folder']}</option>\n";
Should be :
echo "<option value=\"$folder\">$folder</option>\n";
// OR
echo "<option value=\"" . $folder . "\">" . $folder . "</option>\n";
// OR
printf("<option value=\"%s\">%s</option>\n", $folder, folder);
I've given up double quotes a while ago... I always (or almost) use single quotes... so, in my case, I would write :
echo '<option value="' . $folder . '">' . $folder . '</option>' . "\n";
Finally, when developping, I strongly suggest setting error_reporting (in php.ini) to E_ALL (by default it is E_ALL & ~E_NOTICE). That way, you will see error when you want to use an unset variable...