New Orleans Mayor LaToya Cantrell and the City Council are at odds over how to spend a $5 million fine the city demanded from Entergy New Orleans because of the use of paid actors to support the company's campaign to build a new power plant in New Orleans East.

The mayor wants the council to send all the money to the cash-strapped Sewerage & Water Board, but council members are eyeing at least some of the cash for improvement projects in the area where the natural gas-powered plant will be built.

In a March 12 letter, Cantrell criticized the council for considering other uses for the money. 

The cash is controlled solely by the council, which regulates Entergy, and not by the mayor. 

“My administration has made it a priority to make you aware of the dire financial and physical condition of our Sewerage and Water Board, and the consequences should the S&WB collapse,” the mayor wrote. “So to learn that the council is considering directing some of the funds received from the fine to address projects other than the S&WB is disturbing.”

The council fined Entergy $5 million after a contractor working for the utility hired actors to voice support for its $210 million power plant at council meetings early last year. Entergy cut the check on March 15. 

Creating a false show of support or opposition to an issue, known as “astroturfing,” is not illegal, but it was widely criticized and nearly derailed Entergy’s campaign for the plant. 

But rather than kill the project — which Entergy says is needed to prevent future widespread power outages in the city — the council agreed in February to take Entergy’s money and said publicly that it could go toward the S&WB.

A week later members changed their tune and said that some of the money might go to the East.  

Cantrell said that flip-flop goes against the council's resolution to approve the $5 million fine. But despite members' public statements at the time, the Feb. 21 resolution itself says nothing specifically about how the money will be spent. 

It does direct Entergy to work with the S&WB to address power issues, and says the money will be deposited in a fund under the council's control. The council has already established that fund. Two ordinances will be introduced Thursday to transfer the money there. 

"Every dollar of the fine paid by Entergy should be directed to the S&WB to help stabilize this vital entity on which the people of our city depend," Cantrell wrote. "There is no higher emergency, nor is there a more immediate priority, than the need to address and properly fund this vital part of our infrastructure." 

Councilman Jared Brossett, who heads the council’s Budget Committee, said a final decision on use of the money has not been made.

“There was discussion about the money going to New Orleans East, and I support that,” said Brossett, who represents part of that neighborhood. “There are a lot of public needs in the city, and we have to spread this money out.”

Meanwhile, the chief aide to Councilwoman Cyndi Nguyen, who represents most of the East plus the Lower 9th Ward, said the council talked recently about splitting the $5 million down the middle to benefit both the S&WB and the East because the plant will be located in the Michoud area.

“Some of the things (Nguyen) envisioned using it for were a cleanup of Lincoln Beach, and to put up more crime cameras in areas where there is a lot of dumping,” said Terrie Guerin, Nguyen's chief of staff, adding that the people in New Orleans East will face any issues associated with Entergy's new plant.

"They are the most affected by (the new plant), and they should reap some benefit," Guerin said.


Follow Jessica Williams on Twitter, @jwilliamsNOLA​.