The exchange for the debt economy
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New Orleans Mayor Helena Moreno’s administration is warning that city finances remain in dire shape as sales and property tax revenue trickles in more slowly than expected and payments on a $125 million emergency loan come due.
Addressing the City Council Budget Committee on Wednesday, city officials said they’ve only collected 29% of projected property taxes and 10% of sales taxes as of Feb. 20. Chief Administrative Officer Joe Giarrusso said he expects those numbers to improve dramatically next month, as procrastinating property owners meet the Feb. 28 payment deadline and sales taxes from Mardi Gras are accounted for.
Still, with just $27.5 million in cash on-hand, the city has almost no margin for error in covering its $65 million monthly operating and personnel expenses. And that amount doesn’t include the loan repayment, which isn’t included in the 2026 city budget. The repayment — with interest — is due in several installments before the end of June.
“There’s a critical issue the city is facing in terms of having enough revenue come in order to meet the expenses,” Giarrusso told council members.
The city already made one loan repayment this month, and another one for $55 million — the equivalent of nearly a full month of personnel and operating expenses — is due next month. A full schedule of repayment deadlines was not immediately available on Wednesday afternoon. The city’s finance director, Alyssa Rambeau, assured council members the city will be able to make the next loan repayment.
Some council members said they were surprised the loan repayments aren’t included in the city budget, which Moreno devised with her transition team before taking office. Councilmembers Aimee McCarron, Matthew Willard and JP Morrell urged administration officials to include future loan repayments in next year’s budget.
“We cannot pay bills we don’t acknowledge are bills,” Morrell said.
Giarrusso said the repayments aren’t in the budget because “the whole world knew exactly what the expense is,” referring to the highly publicized cash shortage in November that threatened the paychecks of nearly 5,000 city workers created the need for the $125 million emergency loan.
The loan proceeds, which covered payroll expenses for three months, are now tapped, and the Moreno administration is transitioning from relying on the loan as a crutch to paying it off. Giarrusso said after the meeting that, so long as tax revenues catch up to projections, he does not expect another cash crisis like the one last year.
Another loan — known as a revenue anticipation note — will be needed later this summer, although the exact timing and amount haven’t been determined.
“What I’m focused on is, how do we make sure we get the RAN paid, how do we make sure we get city employees paid, and then getting to the summertime in order to go for the next RAN,” Giarrusso said after the meeting.
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