As it plans next year's budget, New Orleans Mayor LaToya Cantrell’s administration is looking at ways to collect millions of dollars it says the city is already owed. But it also is floating the possibility that it might seek to raise the sales tax and trash collection fees in future years to bring in more revenue.
The administration is looking at ways to make up for revenue that would be lost if the city scales back on its traffic camera program. But the effort also serves as the beginning of a larger conversation about the menu of options available in future years, Chief Administrative Officer Gilbert Montaño said Wednesday.
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Montaño will be presenting various options to the City Council's Budget Committee on Thursday, as part of a presentation on ways the traffic camera program could be cut back or phased out. Council members expressed frustration a month ago over a lack of details about the administration's plans.
On the campaign trail last year, Cantrell pledged to eliminate the traffic cameras, which net the city about $22 million a year. But she and her administration have to do so in a way that doesn’t bust the budget.
The range of options that will be presented to the council on Thursday will range from the full elimination of the program to leaving all the cameras where they are but turning off those in school zones outside of school drop-off and pick-up hours, which would mean a $4.6 million hit to the budget.
Montaño said he will not be recommending any one approach Thursday. He said the exact strategy the administration will pursue will depend on whether the money lost can be made up in other areas.
The administration is still working on the budget, but Montaño said it will be ready on or before Nov. 1, the legal deadline for presenting it to the City Council. Council members have been pushing the administration to release it earlier to allow them more time to comb through the spending plan before they have to vote on it by Dec. 1.
At the moment, officials are estimating 2019 revenue will total about $652 million, which would include millions in new money from internet sales tax collections, short-term rental taxes and general economic growth. That figure assumes no changes in the traffic cameras program.
City departments have requested about $68 million in new spending for the coming year, though Montaño said that figure represents the “fully loaded BMW” of budgets, with every department's wish list included. Exactly how much of that will end up in the budget is still to be determined.
Montaño said the administration will be going after about $4 million in money owed to the city from various sources including franchise fees, outstanding Emergency Medical Services debts, short-term rental fines and money owed for police details.
Though no tax or fee increases will be included in the mayor’s 2019 budget proposal, Montaño said the administration wants to put the ideas out there to start the conversation for future years.
“If I don’t put them all on the menu, we can’t have a discussion,” he said.
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The biggest potential source of new revenue would be increasing the city’s sales tax by half a percentage point, which would take advantage of the maximum sales tax rate for the city authorized by the Legislature in the 1980s. The city now charges a half of a cent less, Montaño said.
That would bring in about $46 million a year, but such a move would need to be approved by the voters and is complicated by the regressive nature of sales taxes, Montaño said.
Another option would be raising trash collection fees, which could bring in between $4.4 million and $8.5 million. Montaño noted that those fees haven’t been increased since 2010, and the cost of collecting trash has outpaced the amount being brought in.