NEW ORLEANS — New Orleans Mayor LaToya Cantrell’s use of a city-owned apartment at the Pontalba building is worth nearly $40,000 and should be given up, according to the New Orleans Inspector General’s Office.
Cantrell’s use of the apartment, apparently as a residence, has received scrutiny over the past year.
The Inspector General’s Office said that an understanding of an undocumented and seemingly murky agreement between the French Market Corporation and the city of New Orleans is that the apartment should remain vacant and reserved at all times for events sponsored by the Mayor. There appears to be no evidence of a written document stating the purpose of the apartment, but historically it has not been used as a permanent residence.
In a letter to the mayor and the French Market Corporation, Inspector General Ed Michel stated that there is awaiting list of over 300 for an apartment at the Pontalba and that a market rate rental would be close to $3,000 per month that the FMC is not collecting. In addition there is another $4,000 in utilities that the city would have otherwise not have paid.
“This arrangement, in the case of personal use by the Mayor, gives the appearance of a donation of public property in possible violation of the Louisiana Constitution,” said Michel.
Michel said the Louisiana Attorney General requires three elements be met for an expenditure or transfer of public funds to be permissible, including:
1. The expenditure or transfer of public funds or property must be for a public purpose;
2. The expenditure or transfer of public funds or property, taken as a whole, does not appear to be gratuitous; and
3. Evidence must demonstrate that the public entity has a reasonable expectation of receiving a benefit or value at least equivalent to the amount expended or transferred.
Michel says the use of the apartment as a residence did not appear to satisfy any of those requirements.
Late Wednesday afternoon, Gregory Joseph, Mayor Cantrell's Director of Communications issued a statement saying that the IG's letter itself shows that there is no specific plan for how the apartment should be used:
“The Office of the Inspector General’s report yielded no substantial results and only further reiterated our position in that the most recent Franchise Agreement contains no rules governing how the unit should be used. Furthermore, seeing as though this apartment is and has always been owned by the French Market Corporation, it would be unsuitable for the City of New Orleans to take any specific position as to how they choose to operate their facility.”
Councilman Joe Giarrusso said the idea that the city give up the apartment altogether probably would cost it a valuable resource.
"I understand the Pontalba is to be used for entertaining, for bringing in dignitaries, for showing off the French Quarter to people from outside the city, and I'm not sure we want to lose that at this instance," he said.
Michel said that his office recommends that the city relinquish the apartment altogether to eliminate any further controversy and to ensure that the city receives a benefit equal to the fair market value of a desirable apartment.
Should that not happen, Michel said his office advises that a cooperative agreement between the city and the FMC should occur and include:
1. The public purpose of the apartment;
2. Restrictions on any uses of the apartment that would appear gratuitous and in violation of the Louisiana Constitution; and,
3. Effectively demonstrate the FMC has a reasonable expectation of receiving a benefit or value at least equivalent to the fair market value if the apartment was leased to the public.