Furloughs, layoffs likely for New Orleans city employees in 2026

The big picture: Moreno says she prioritized public safety and essential services, while making cuts elsewhere.

• Her budget replaces the one Mayor LaToya Cantrell proposed, which had a 30% across-the-board cut to all operating budgets.
• "That's like taking a bulldozer to the budget," Moreno said last week, saying her team went with a more surgical approach.
• NOPD, NOFD, EMS, sanitation, public works, NORD and a few others are fully funded in Moreno's proposal.

Yes, but: About 700 non-essential employees across the city will be furloughed one day every two weeks. It will save the city $6.8 million, she says.

• Those employees work for the City Council, the mayor's office and in other non-public safety departments.
• Her plan also lays off about 125 workers and saves $9.45 million through a hiring freeze on vacant positions.

Zoom in: Leaders are scrounging beneath proverbial couch cushions for money.

• Moreno's team is reviewing city-owned properties and seeing what they can sell or renegotiate.
• They are also reviewing city-owned vehicles and looking for efficiencies. For example, Moreno says Cantrell has four city vehicles assigned to her. Cantrell's office didn't respond to Axios' request for details.
• And Councilmember Joe Giarrusso — the council's budget chair who also worked with Moreno on her budget — says he's going after every penny owed to the city, including money he says was mistakenly paid to the IRS.

What's coming: Giarrusso and City Council President JP Morrell say they will propose new fees. They include:

• A $20 fee for every person who rides in a parade during Carnival season.
• Increased sanitation fees that may include an additional weekly pickup during the summer. Giarrusso says he will have several proposals for the current $24 rate, and residents will be able to weigh in.
• Towing fees will be increased to the state average, Morrell says, but he didn't say how much.
• Customers will be able to pay for four hours at a parking meter at once, instead of two. Morrell says people often pay for the longest timeframe when parking, so he thinks the city will make money.

Friction point: Moreno says the city is in dire straits because of "complete mismanagement of the budget" from the Cantrell administration.

• The city has an estimated $160 million deficit this year and had to seek a $125 million loan to make payroll this month.
• "Did (former CAO Gilbert Montaño) mislead us? Absolutely," Morrell told reporters last week.
• Cantrell and her financial leaders previously placed the blame back on the council for overspending.

Incompetence or malfeasance?

The intrigue: Mike Waguespack, the state legislative auditor who is currently reviewing the city's finances for the past few years, declined to say if he thought the actions were from incompetence or malfeasance.

• "I think that's to be seen," he said. "Certainly, there's red flags from an auditor standpoint."
• Incompetence isn't illegal, while malfeasance is.

Between the lines: Moreno estimates it will take three to four years to dig the city out of the budget crisis.

• The city is expected to seek another loan next summer, officials say.

Meanwhile, Moreno says she will announce the leadership for her administration on Tuesday.

• Some city leaders are staying, she says, while others aren't.
• City employees are also in the process of reapplying for their jobs with the new administration, which starts Jan. 12, 2026.

What's next: The City Council meeting starts at 10am Monday. Watch the livestream.

Go deeper

• What your $24 sanitation fee covers
• New Orleans mayor-elect plans to cut "top heavy" city staffing