Moreno Talks Budget and City Services at BGR Event
NEW ORLEANS – Mayor Helena Moreno told business and civic leaders gathered for the March 11 Bureau of Governmental Research (BGR) Breakfast Briefing that improving the city’s basic services and fixing the budget are the first keys to unlocking New Orleans’ potential. “We have one of the most amazing cities not just in this country
“We have one of the most amazing cities not just in this country but in this world,” Moreno said. “If we just make it function, the sky is the limit.”
Moderated by BGR President and CEO Becky Mowbray, the event was sold-out with additional viewers joining via livestream.
Paying Down Debt, Cutting Costs
Moreno said she and her deputies lose sleep over the city’s budget challenges. She explained that a major factor is the revenue anticipation note the city issued to cover payroll for the budget shortfall — borrowing that created a $125 million impact on the general fund.
The administration now expects to retire that debt faster than originally projected by the legislative auditor. Instead of taking four years, Moreno believes the city can finish paying it off by 2027.
“While some are saying it’s going to take us longer to do things, we’re saying ‘Watch us – we’re going to get things done faster,’” Moreno said.
Moreno said the administration has already begun cutting costs and tightening operations which is part of a broader effort to stabilize the budget and respond to the city’s recent bond rating downgrade. Those measures include eliminating 36 positions in the mayor’s office, introducing a furlough system requiring one day off every two weeks, reducing overtime spending by roughly $10 million, renegotiating long-term leases and pursuing new revenue sources. Moreno said the administration is also reviewing unused public buildings that could be returned to commercial use.
“I have tasked the New Orleans Building Corporation with identifying the top 25 buildings in the City of New Orleans that they believe could be put quickly back into commerce,” she said.
Sanitation Fee
Another closely watched issue was the administration’s proposal to increase the city’s sanitation fee.
“This week I announced that I will be asking the New Orleans City Council to raise the sanitation fee,” Moreno said. “Let me be clear – I hate doing that. Politically it’s horrible. But we are to the point where we have no choice.”
According to Moreno, the current fee structure leaves roughly a $20 million gap between what residents pay and what the city spends on sanitation services. The fee itself has not been adjusted since 2011.
Neighboring parishes including Jefferson, East Baton Rouge and Lafayette structure their sanitation fees so that revenue more closely tracks the actual cost of services. New Orleans’ proposal would include an annual adjustment designed to keep the fee aligned with rising costs rather than waiting years between increases.
Moreno Describes the Police Pension Penalties Fix
Financial penalties tied to a Louisiana law governing the Municipal Police Employees’ Retirement System (MPERS) are another concern for the city. Under the law’s “partial dissolution” rule, penalties can be triggered if a police department’s participating employees fall below 70% of the previous year’s level or if the department loses at least 50 officers in a year.
“As you all know, the City of New Orleans has never tried to defund or dissolve the police department,” Moreno said. “But there were a couple of years during COVID where we lost more than fifty police officers.”
New Orleans now faces more than $38 million in potential fines under that provision, an issue Moreno said several Louisiana municipalities are grappling with as well.
“I might as well take that $38 million and put it in a bucket and light it on fire,” Moreno said. “It is literally like throwing money away. So, I’m fighting tooth and nail not to pay this penalty.”
City officials are now joining other municipalities in working with state lawmakers to address the problem.
Another dispute involves whether police retention bonuses should count toward pension calculations. Moreno argued that short-term spikes in pay should not be treated as pensionable compensation because they create instability in the system. She said the legislative auditor is working closely with the administration on the issue.
“As you all know, I’ve embedded the legislative auditor in my office,” Moreno said. “I’ve actually moved him into the mayor’s office. He and his team are in my back conference room.”
In the past, the city routinely paid the pension contribution tied to retention bonuses, but Moreno said there is no legal or policy requirement to continue doing so. Ending that practice could represent roughly $41 million in savings, though the Louisiana attorney general is expected to issue an opinion on the matter.
Safety and Permits – New Director to be Announced March 16
Moreno said reforming the Department of Safety and Permits is another major priority and that the new director is expected to be announced March 16.
“Safety and Permits for too long has been a barrier for progress here in the City of New Orleans, whether you are trying to start a business, whether you’re trying to have your business function and operate correctly, or whether you are a homeowner trying to do a renovation to your house, progress has been stalled because the department has been so inefficient,” Moreno said.
Water Mains - A Plan to Fix Systemic Breakages
Moreno also addressed the city’s recurring water main breaks, which she said are worsened by dramatic weather fluctuations.
Deputy Chief Administrative Officer for Infrastructure Steve Nelson has been tasked with identifying solutions. The city is conducting acoustic analysis of water lines to locate weaknesses, with potential fixes including lining pipes or applying epoxy coatings that effectively create a new interior pipe.
Once cost estimates are finalized, Moreno said the city will work with state and federal officials to pursue funding for the repairs.
MSY - The Road to Becoming a Major Airport
Moreno also pointed to long-term expansion plans for Louis Armstrong New Orleans International Airport, which could include additional gates, expanded terminal capacity and new parking structures to accommodate growing regional demand.
“Guys, we are on the cusp of becoming a major airport,” Moreno said. “That’s the story that we tell. That vibe, that excitement attracts more interest and investment.”
Moreno said efforts to stabilize the city’s finances, modernize operations and invest in infrastructure are all part of a broader goal of making City Hall function more effectively, something she believes will allow New Orleans to compete more aggressively for residents, businesses and major projects.
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