City officials will ask voters this spring to approve a $26.6 million annual property tax hike to bolster the ranks of the New Orleans Police Department and pay for a $75 million settlement with the firefighters union.
The proposed 7.5-mill increase, which amounts to about 5 percent of the parishwide tax rate, was announced Wednesday by city officials, public safety representatives and business leaders who called for voters to support the increase to bolster public safety.
It would take effect in 2017.
“Public safety is and has always been our top priority,” Mayor Mitch Landrieu said.
The call for higher taxes comes as city officials have been bombarded by complaints from residents worried about increases in crimes such as armed robberies and carjackings, and fearful of brazen incidents such as a mass shooting at Bunny Friend Park and hold-ups at Uptown restaurants.
But officials acknowledge that more funding is not a panacea for the city’s crime problem or the slow growth in the NOPD’s depleted ranks. For the new money to be of use, the department will need to dramatically increase its success in recruiting.
The proposed increase actually encompasses hikes to two taxes: a 5-mill increase in a tax dedicated to police, boosting the department’s budget by $17.73 million a year, and a 2.5-mill increase in a tax for fire protection, which would provide $8.87 million a year. Both those taxes now are set at about 5 mills.
The City Council is expected to vote Thursday on whether to put the increases before the voters. If approved by the council and then by the state Bond Commission in February, the proposals will be on the April 9 ballot.
“This is a piece in the puzzle to continue building the great city our mayor is building,” Councilman James Gray said.
Voters statewide and in Orleans Parish tentatively agreed to allow the increases in 2014, when they approved a constitutional amendment allowing the city to seek voter approval to double the 5-mill cap on each of the two dedicated taxes.
Those taxes are the only property taxes in the parish not subject to the homestead exemption, which means all property owners pay them on the full assessed value of their homes.
On the east bank, the higher taxes would bring the parishwide tax rate to 159.28 mills. The West Bank rate would rise to 153.21 mills.
The city is anticipating that the large increases in sales and property tax collections it has seen during the recovery of the past several years will slow as the city settles into a more normal economic cycle, Chief Administrative Officer Andy Kopplin said. That means the city won’t be able to count on higher revenue keeping pace with increased costs as the department puts more officers on the street, he said.
Fielding a force of 1,600 officers — which the administration has set as its long-term goal — would cost about $35 million to $40 million more a year than the $140 million the city has budgeted for the department in 2016. But money hasn’t been the primary roadblock to expanding the department.
Instead, recruitment issues and limits on the size of new academy classes mean the department has been unable to bring new officers on quickly enough to replace those who leave.
Despite aggressive recruitment efforts that included a 15 percent pay raise for officers, looser educational requirements and an expedited application process, the department ended 2015 with 1,163 officers, only 31 more than it had when the year began. While 136 new hires joined the force, 105 officers retired or left the department for other reasons.
“For the first time in several years we hired more than we lost to attrition,” Superintendent Michael Harrison said. “Now we need a sustained funding source.”
The goal for 2016 is to bring the total up to 1,266 officers, which would require more than three times the increase the department saw last year. If the department meets its hiring goals this year, it will need to increase its budget by $8 million to continue to pay those officers through 2017, Kopplin said, plus more money for any additional officers hired next year.
The proposal to increase the Fire Department tax has been expected since the fall, when the Landrieu administration struck what the mayor described as a “landmark deal” with the firefighters union to settle a decades-old lawsuit over $75 million in back pay owed to firefighters. The deal called for that debt to be paid off over the next dozen years using money from the 2.5-mill increase. Any additional money from the tax would be used to shore up the firefighters’ ailing pension system, officials said.
While the constitutional amendment requires the new money to be spent directly on public safety, city officials said the back-pay settlement and the pension system qualify under that description because they are part of the Fire Department’s budget.
“When you vote for this millage, you’ll be voting to improve public safety,” firefighters union President Nick Felton said. “The funds here will secure the firefighters’ future through their pensions.”
Follow Jeff Adelson on Twitter, @jadelson.