Landrieu: Budget surplus won't cover looming liabilities


Posted on May 21, 2014 at 6:13 PM

Updated Thursday, May 22 at 6:35 AM

Paul Murphy / Eyewitness News
Email: | Twitter: @pmurphywwl

NEW ORLEANS -- Leading economic indicators show positive trends for New Orleans. According to the city's Revenue Estimating Conference which met on Wednesday, the city's population now stands at around 379,000, up by 10,000 from the same time last year.

The income forecasting panel also revealed unemployment dropped to just over 4 percent, half the national average and city tax revenue is up by nearly 10 percent.

"You can see what I consider to be a stunning turnaround from where were four years ago to where we're going now, in an effort to grow the economy," said Mayor Mitch Landrieu. "Where we're going to realize a $10 million increase in sustainable income over the years which is something this city hasn't seen in a long time."

Landrieu says regardless of how good that feels, pending liabilities outstrip even the most aggressive growth in the United States of America.

There are federal court orders to reform the NOPD and the Orleans Parish Prison and a civil court judgment requiring the city to pay millions of dollars toward the fire department's retirement fund.

"Just with the judgments it's about a $40 million gap and you add to that wanting to double the funding for NORD and make sure the libraries have a sustainable source of funding or really repair all of the streetlights in the city the gap gets somewhere upwards of $100 million to $150 million."

"If every scenario works out the worst for the city of New Orleans, certainly, we're looking at a catastrophic situation," said City Council President Stacy Head. "I don't believe that's going to happen."

Head, who also chairs the city council budget committee is encouraged that the city may end the year with a budget surplus for the first time since 2009.

"My hope is that by tightening our belt and by doing better in revenues than expected, that will certainly blunt any need to do anything dramatic such as furloughs," said Head."

Meanwhile, Mayor Landrieu admonished state lawmakers for blocking his proposals to raise taxes on cigarettes and hotel rooms. Only a bill to raise property tax for the police and fire departments continues to move through the legislature.

"The legislature either has to honor its obligations to give the city of New Orleans the money that we're owed like the casino support services contract that should be in the range of $10 million and we have to fight every year for $3.5 million or the worst case scenario, they have to give us the authority to decide whether we want to raise revenues on our own," said Landrieu.

"They won't give us either of those things, so it puts us in a really, really difficult decision of just having to cut."

Landrieu, a former state representative, spent much of Wednesday in Baton Rouge, lobbying the legislature.