No recycling, slower repairs: What budget cuts could mean for New Orleans
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Joe Threat, the city's chief administrative officer, presents the 2026 budget proposal to the New Orleans City Council. Photo: Carlie Kollath Wells/Axios
New Orleans leaders are considering cutting city services and raising taxes next year to claw out of an estimated $160 million hole.
Why it matters: Now is the time to voice your opinion before the budget is finalized.
The big picture: The New Orleans City Council starts its second week of budget hearings on Monday.
- Department heads are outlining how they'll absorb a proposed 30% cut to all operating budgets without layoffs or furloughs.
- The common theme so far is loss through attrition, which leaders say will translate into low morale. And the work will take more time to do.
Threat level: These are some of the specific services department heads say will be affected next year if the proposed budget is passed.
- No curbside recycling.
- Reduction in pothole filling, asphalt patching, traffic signal maintenance and sidewalk repairs.
- Delayed cleanup for Mardi Gras, second-lines and special events.
Catch up quick: The city is on track for a $160 million spending deficit this year, according to an analysis from Mike Waguespack, the state's legislative auditor.
- Most of it comes from overtime costs and overly optimistic revenue projections from events like the Super Bowl and Taylor Swift's concerts, the report says.
- Chief administrative officer Joe Threat also says the city has not been reimbursed by the state or the feds for activities related to the Super Bowl and Mardi Gras. He didn't say how much the city expects.
- The city only has $8 million left in the bank, Waguespack says, after the restricted savings fund is pulled out.
Friction point: Administration officials and council members are pointing fingers about who knew what when, especially when it comes to overtime spending.
- The first warning bell about financial trouble came in February, after Mayor LaToya Cantrell backed out of a settlement with the Orleans Parish School Board.
- Romy Samuel, the city's finance director, told the council that "financial instability is imminent" in her February presentation if spending and revenue trends continued.
- Council members at the time seemed skeptical, but City Council President JP Morrell pressed finance leaders on whether austerity measures were needed. Councilmember Oliver Thomas asked if services were going to be cut and finance leaders told him no.
Going forward, the council wants an easily readable report that details budget-to-actual figures, including overtime expenses.
Zoom in: Threat, who started in the role in September after former CAO Gilbert Montaño left for a job with Audubon, says he issued hiring, travel and spending freezes through December, and they are likely to be extended.
- But with the new administration coming in Jan. 12, it's unclear if he'll keep his job. Mayor-elect Helena Moreno posted the CAO position last week.
Inside the room: The recent elections have added an more nuance to this year's budget discussions.
- Moreno's questions at the meetings give insight into how she's thinking about City Hall under her leadership.
- She's been zeroing in on what the departments outsource and "looking for efficiencies."
- She's also been asking questions about how artificial intelligence can help the city, such as a chatbot for answering residents' questions about city services.
The fine print: The budget hearings will continue into next month. The council plans to approve a final document by Dec. 1.
What's next: Homeland Security, the health department and NORD are among those scheduled to give proposals this week.
- The meetings are open to the public and allow comments from residents. See the schedule.
Editor's note: This story has been corrected to reflect that Homeland Security, the health department and NORD are set to give proposals this week (not NOPD).