NEW ORLEANS — The New Orleans City Council asked a judge Thursday to dissolve a multimillion-dollar trust account so it can be turned over to the city, and it also asked the judge to block Mayor LaToya Cantrell from spending any more of the trust’s proceeds.
The Edward Wisner Trust was formed in 1914, when Wisner died and left huge tracts of land across southeast Louisiana in trust, with the mayor of New Orleans as the trustee. A later agreement shared the money generated by the land with several Wisner heirs and smaller amounts went to Tulane University, LSU Health Sciences Center and the Salvation Army.
The Wisner lands include Port Fourchon, which became one of the busiest oil and gas ports in the world. Leases there generate $10 million a year or more for the Wisner Trust. Under the trust, 34.8 percent, or about $3.5 million a year, goes to the city.
After 100 years, the trust was supposed to dissolve, and the land and all money it generated was supposed to go over to the city of New Orleans.
Instead, the last two mayors of New Orleans, Mitch Landrieu and LaToya Cantrell, have agreed to extend the trust, continuing to share the money with the heirs and other recipients. In 2020, Cantrell quietly filed papers to reconstitute the trust as a new entity, essentially extending it in perpetuity.
“When you have a trust and it's dead, it cannot be revived, it cannot be resuscitated,” said City Councilman Joe Giarrusso, who is an attorney. “You can't do any paperwork that makes it come alive again.”
Under the trust, the mayor doles out the money. If the trust goes away, the money comes into the city’s general fund and the City Council gets to decide.
The council has already sued Cantrell, arguing her 2020 action to reconstitute the trust was illegal. Thursday’s motion in Orleans Parish Civil District Court asks for immediate action.
“We thought it was important to have a two-step process,” Giarrusso said. “Step one is let's stop spending money and put just a pause on that so it isn't going and we don't know where it's going. But then step two is to have the court say officially for the second time now that the entire corpus belongs to the city and it's back in the city's hands.”
Another issue for the council has been the lack of transparency. For generations, mayors held public meetings so a panel could recommend Wisner Grant recipients to the mayor. The selected recipients then had to file public spending reports, which were recorded in the City Archives. But Giarrusso says Cantrell hasn’t been doing that, and that’s why the Council had to act.
As WWL-TV first reported Wednesday, Cantrell already sent $850,000 in Wisner money to a nonprofit she created, Forward Together New Orleans, without notifying the Council. That’s now the subject of an Inspector General investigation, and FTNO has frozen its bank account so the money can’t be spent.