NEW ORLEANS — Mayor LaToya Cantrell painted a dire picture of the city's financial situation during an interview on WBOK Radio Monday, saying the lack of income from taxes could cut $100 million from the city's operating budget.
"We are anticipating a budget deficit upwards of $100 million for 2020," she said.
If the city really does stand to lose $100 million this year, coronavirus will have gouged out about 14% out of the city's budget, forcing cuts to programs across the board to keep the lights on at city hall.
This is not the first time Cantrell has sounded the alarm about the financial blow COVID-19 will land on the city. Earlier in the month, when she announced a hold on tax payments while businesses were forced to remain closed or under reduced operations, the mayor told reporters that the move would be a heavy burden on the city's budget.
But her Monday "town hall" broadcast outlined the clearest picture yet of the future threat.
In Nov. 2019, Cantrell and the city council negotiated a $725.9 million budget for fiscal year 2020, which the city is currently in. That budget relies on predictions of how much money the city will get from sales taxes and other fees.
But the coronavirus – an outbreak that has already had unprecedented impacts on the economy from local businesses to global markets – throws those predictions out the window.
"This is like a tragedy or disaster 5.0," Cantrell said. "It's catastrophic, what's happening to our bottom line."
Gilbert Montano, as the city's chief administrative officer, is in charge of the budget. During the town hall, he said the city has finite reserves of cash.
Those reserves are being supported at least partially by the controversial continuation of parking citations. City officials have deemed the meter maids as "essential services," which led to anger from some residents.
But that trickle isn't nearly enough.
"That certainly has an end date," Montano said. "You can simply do the math to figure out when that's going to be."
Montano didn't say exactly when he expected the cash to run out for city government.
The only way to push that date back would be a shot in the arm: millions of dollars pumped into the city's coffers, possibly from the federal government.
"We...are going to have an end date as far as where we are able to pay bills unless we have some type of infusion," Montano said.
Montano said the city was advocating for relief money. But the federal relief he spoke about might not be coming soon.
Unlike state-specific disasters like Hurricane Katrina or the BP Oil Spill, coronavirus is causing the same problems across the U.S.
Almost all of the federal resources that usually pour in after a disaster will need to be spread across dozens of states, including other hotspots like New York and Seattle.
Louisiana received about $1.8 billion from the $2.2 trillion economic relief bill passed by Congress Friday, but it's unclear how much of that, if any, is set aside to prop up local governments.
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