New Orleans Mayor Ray Nagin says it will take "courage" to pass his proposed spending plan for next year.  He asked the city council to support a $1.16 billion budget, topping the $1 billion mark for the first time in city history.

"We are poised for great things in the city of New Orleans," said Nagin. "We need to have the courage to really step forward and do what we need to do to make sure that this recovery stays on track."

The spending plan sets aside $106 million for a forgivable loan program to encourage home ownership in the city, an additional $10 million for street repairs and drainage and a $1 million increase for grass cutting.

The total police budget is now nearly $130 million. That includes $1.6 million for police overtime and new crime-fighting technology.

Mayor Nagin is asking for 1700 officers, 200 more than the current staffing.

"Keep in mind that right after Katrina we lost over 500 police officers," said Nagin. "With this budget target, we will be above pre-Katrina staffing levels for the New Orleans Police Department that was at 1648 police officers before Katrina which was our highest number in recent times."

Mayor Nagin says it will take a 10-mil property tax increase to pay for his record budget and restore the city's $24 million rainy day fund.

That would be a $12-a-month increase for most homeowners.

Some City Council members are already lining up against the tax increase.

"I must say at first blush, though, that we're going to need to take our pencils out and sharpen them very quickly because we're going to need to do some cutting here," said City Council VP Arnie Fielkow. "I don't believe our citizens can afford, right now, a 10-mil increase."

"I do think we're going to have to use more restraint," said Councilwoman Stacy Head. "I am quite hesitant to support a roll forward. People are strapped. Just like a family we have to live within our means."

"This is going to be our most challenging budget, so the administration and the council will have to work really close together to get us through this," said Mayor Nagin. "This is not going to be a slam dunk."

By law, the City of New Orleans must have a new budget in place by the December 1.

Budget hearings begin next Wednesday.