Mayor LaToya Cantrell will celebrate her first year in office May 7. At press time it appeared as though she’ll have a significant achievement to tout on that anniversary date: hauling down $27 million a year for much-needed infrastructure repairs as well as a one-time $48 million infusion to prop up the beleaguered Sewerage & Water Board (S&WB), which has teetered on insolvency. That’s a singular accomplishment, though she had lots of help — in particular from Gov. John Bel Edwards.
Last year, Cantrell began what she dubbed a “fair share” campaign seeking to give the city a cut of some of the local tax dollars now going to the Ernest N. Morial Convention Center and several other tourism-related agencies. Edwards and key legislators seemed cool to the idea at the time. Stephen Perry, president and CEO of New Orleans & Co., the area’s lead tourism entity, called the idea that the industry wasn't paying enough a “punch to the gut.”
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The idea appeared doomed, but Cantrell persisted. Ultimately the outlines of a deal were hammered out, thanks to a big assist by Edwards, who promised to get some state funds for the one-time infusion. The mayor — and the city — seemed on the cusp of getting much, though not all, of the money Cantrell had sought.
Cantrell and Edwards scheduled a May 1 press conference to announce the deal, but Cantrell’s team canceled it the night before, saying some additional, last-minute details were unacceptable. At press time, negotiations continued between Team Cantrell and hospitality leaders.
The 2019 Louisiana Legislature should pass public teacher pay raises and set a higher minimum wage.
The problematic details were said to be contained in proposed amendments to HB 589, one of several measures codifying the grand bargain. The House Ways and Means Committee was set to hear the bill, authored by state Rep. Walt Leger III, D-New Orleans, May 6. That put a serious deadline on the negotiations.
Another bill related to the deal, HB 43 by state Rep. Jimmy Harris, D-New Orleans, would authorize the city to increase the tax on short-term rentals (STRs) to 6.75 percent — the same as the tax on the city’s hotel rooms. That tax would be split 75/25 between the city (for an infrastructure fund) and New Orleans & Co. It would require voter approval.
Dedicating STR taxes to infrastructure and tourism generated pushback from fair-housing advocates, who want at least some of the revenue to go to affordable housing. That’s a potential deal breaker, however. Upstate lawmakers understand New Orleans’ drainage woes and rutted streets, but they would see dedicating part of the STR tax to affordable housing as a tacit admission that drainage and streets aren’t the city’s biggest problems. Moreover, legislative doubters would argue that if the city can afford to give some of the new tax to affordable housing — a local problem in lawmakers' view — then New Orleans must not need money from the state. That would kill the deal.
What can’t be argued are the citywide benefits that will follow if the mayor and hospitality leaders can close their tentative deal in time to get it through the Legislature. Doing so would put New Orleans infrastructure — particularly the S&WB — on track for years of much-needed improvements.
A deal to raise hotel taxes to help fund infrastructure repairs in New Orleans saw a tumultuous 24 hours, with Mayor LaToya Cantrell agreeing …