Councilmember McCarran.

Here.

Councilmember King, we have a quorum.

Let's go ahead and uh start with the approval of the minutes from the January 22nd budget committee meeting.

Councilmember King moves.

Council McKaren seconds.

All in favor?

Three A's.

The minutes are approved.

SAO Jerusalem, we're gonna take uh Dr.

Kelly out of order because she has another uh event to attend.

So Dr.

Kelly, if you want to come on up and we can talk about item number seven, Ashley, if you could read item number seven, that would be great.

Sure.

Item number seven encompasses a bunch of civil service pay plan and rule amendments that have been approved by the Civil Service Commission.

I believe Dr.

Kelly is here to talk specifically about the civil service motions that affect the police, the NLPD Crime Lab, and that's motion 7E, G, H, J, and possibly K.

Thank you.

If you all would introduce yourselves, Dr.

Kelly and uh Commander Gernon.

Hi everyone, I'm Dr.

Shamika Kelly.

I'm the director of the NOPD Crime Lab, and with me is Deputy Chief Nicholas Vernon.

Sorry, I called you Commander.

That's okay.

Um Dr.

Kelly, I I called you here because I want to talk about our DNA lab and specifically the positions that have been pending on the civil service side for approval to get the DNA lab up and running.

Can you talk about the history of what we've done in the past to outsource our sexual assault kits and then go from there and talk about why you need these positions and how they could potentially make money for the city?

Okay, yeah.

So historically, we have outsourced approximately 400 or so cases annually.

So what happens now because we don't have a functioning DNA lab, the laboratory will uh send any or the NOPD will send any cases that need DNA testing to Louisiana State Police Crime Lab, who then will outsource those to a private contracting laboratory.

And so what we've done in-house is try to build uh a DNA lab in-house so that we can remove that dependency.

Um and in doing so, what we're looking at is matching or decreasing the amount of money that it would take to do that.

So one of the things that was asked of me was to kind of compare the cost.

So looking at how much outsourcing costs versus how much it would cost to build your own program.

And what I've calculated based on estimations that I've received from the Louisiana State Police Crime Lab in the past is that approximately 400 cases will cost about 1.5 million dollars.

That is for again 400 or so cases.

The cost per case depends on what crime type it is, but if it's a property crime, it's 1,150 dollars.

If it's sexual assault, it'll be 3,000 and then 4,000 for a homicide.

I'm sorry I had that flipped.

It's 4,000 for the sexual assault and 3,000 for the homicide cases.

In-house, um, I'm sorry, that would total 1.5 million, but on top of that, what you would also have to consider is paying for adjudication.

So each case that goes to trial costs approximately 10 to 15,000 additional dollars to have someone flown in to testify.

And so considering that you're looking at about three million per year for outsourcing costs totally.

Now, comparing that to in-house cases, calculating all of the wages, benefits, overhead, maintenance, equipment, reagents included in per case, comparing apples to apples, it's about $2,400 to process a case in-house here in New Orleans whenever we build our DNA lab.

Now that equates to, if we're looking at 400 cases in totality, that equates to less than a million annually for you to process the same amount of cases.

Now, what we've been able to do in-house is build a very high throughput system internally, and so we will have the capacity to test more than 400 cases.

So that leaves room for potentially testing more case types in-house because keep in mind not everything goes to LSP, the Louisiana State Police Crime Lab.

Because of that, we can test more in-house, or we have the option to um take cases from different jurisdictions.

So if we were to do something like that, um I've calculated that the total revenue could generate approximately 360 to about 483 dollars.

It just depends on the model that we build internally as well as some other other contingencies that we would have to have before we even start talking about revenue generating.

And just as a reminder uh to the public and to my fellow council members, we allocated three million dollars to clear the sexual assault kit backlog, paying the state um through private laboratories to clear that backlog.

And then there was an additional 1.3 million dollars that Mandy Landry, Representative Landry, and uh now Mayor Moreno also advocated for at the state level.

So we have spent about 4.3 million dollars in order to clear the backlog that was sitting at the state lab.

Do we know if there's a current backlog or if that backlog is building back up?

So I inquired this morning of our special uh victims division, and to their knowledge, there is not a backlog that's building up yet.

However, supervisors from the special victims division are actually in Baton Rouge right now, meeting with the state police at the Louisiana Governor's Sexual Assault Um Committee to understand what the future year looked like, what 2026 is going to look like and what our uh caseloads might look like going forward.

So I mean, in reality, I could have probably had a better answer for you tomorrow because they're there today getting the information.

If you can get that information and email it to each of the council members, that would be helpful.

Yes, ma'am.

Council members, do you have any questions for Dr.

Kelly or Deputy Sheep Gerdon on these specific positions?

All right, my intent is to move these forward at our next budget committee so that we can get them filled.

They are not only critical, I think, to safety, but also they are revenue generating uh source of income once we get our DNA lab up and running.

Councilmember McCarran.

Are these general funds?

They are.

Do we have an overview of what that looks like as far as how much it's gonna cost?

Yeah, the general funds or can we get that before the next meeting?

Yes, each of those uh motions with the amount of money annually is in uh should be in your packet.

Okay, thank you.

Any further questions?

Yeah, member Willard.

I had a question about whether these were budgeted for.

And I'm getting a head shake, no.

So this was no they they didn't exist um until you guys created them, so they were not gonna be budgeted for until they exist, is my appreciation of the process.

Okay, thank you.

Any further questions?

All right, thank you all for being here today.

Thank you for your time.

With that, Ashley, you want to get to the regularly scheduled programming.

Yes, ma'am.

We have number three, the budget reports for the period inning in December 31st, 2025, and I believe the CAO's office and finance are here to talk about the very question.

Alyssa.

All right, good afternoon.

Can you all hear me?

All right.

Um, the chair is right.

Uh, some of these slides, council members, I am gonna spend a lot more time on, particularly at the beginning.

Some of these slides I'll move through a little bit more quickly.

Uh I plan on doing most of the presentation through section four.

We'll probably hand off a little bit for five and definitely for section six, which is more of Alyssa's domain.

Um, and I appreciate the time of all the members for meeting with me yesterday to discuss this and the ongoing discussions that we've had.

Uh I I don't think there's any reason to bury the lead here, which is that the budget situation remains dire.

Uh, there is a critical issue the city is facing in terms of having enough revenue to come in in order to meet the expenses that are necessary for residents' needs.

I will say, too, having gone to a couple of the mayor's neighborhood meetings.

The biggest thing that we keep on hearing from residents is the same thing that council members are hearing as well.

We want to make sure trash is picked up.

We want to make sure blight is remediated, we want to make sure grass is being cut, and those are the things that we're trying to do.

With that said, without really significant moves by everybody, um, a true partnership with everyone, uh, the city is is at risk of running out of cash again.

Um, I think everybody knows about the 2025 spending deficit, as well as the obligation to pay back the revenue anticipatory note that now Mayor Moreno and Councilmember Morale and I went to Baton Rouge to ask for.

Uh, the next thing that I have on the slide is slower than expected 2026 revenues.

I'm gonna take just a pause here to explain that a little bit, which is the property bills this year went out on a schedule that they ordinarily do, which is slower than expected given that we need to pay back the revenue anticipatory note.

So, one of the things members that Mayor Moreno is committed to and working on is reaching out to the assessor so that way we can start getting property bills out a little bit earlier.

I do not have the exact answer to this, but my strong suspicion is that people were delayed in pot paying their property tax bills because you probably got it close to Christmas at the beginning of the year with a shortened Mardi Gras season, and so that likely distracted many people from getting their property tax bills in.

I want to thank the council for being vocal advocates for trying to get that money back in.

And the other thing, too, that Alyssa is regularly working on, and I do want to spend a second to talk about this, is reconciling.

All right.

So think about this.

She is trying to really do two jobs simultaneously.

One is trying to write the ship from what we had before and pointing out the hundred different bank accounts, the fact that we didn't have November balance as until the end of January, is that right?

Um December just got closed out today, and trying to do all of the reconciliations and the revenue for things that are coming in simultaneously.

So while I can promise you the administration and I are constantly pushing for urgency, finance is one of those departments that is overwhelmed at this moment given the Herculean task in front of it.

Um I mentioned to you already the hundred different bank accounts.

Alyssa is sorting through all of those as well, and recovering is simply going to be a difficult challenge for all of us.

Uh, if you look at slide four, you can see what Alyssa presented to the mayor and to everybody in our Friday cash management meeting, which is the cash on hand at this point is roughly 27 and a half million dollars.

That was as of Friday.

Obviously, this is a changing number, one that could be higher.

I think a couple weeks ago was 29, it's 27.

We expect this number to go up and down as we have to balance paying back the revenue anticipatory note by March 2nd and just the amount of money that we get in and the speed with which Alyssa and her folks can reconcile the money that have given into property taxes.

So if you look at slide five, um collected versus budgeted, you see the fact that only 29% had been collected as of 220.

Again, some of this is a function of when Mardi Gras we think fell this year.

Some of this is just trying to reconcile as quickly as humanly possible, given everything that's going on.

Um, the other thing is I hope to have an economist hired in relatively short order as well, uh, probably starting after the first REC though, to give them necessary time.

But my earnest hope is somebody with whom the council is pleased with and offers high quality work.

And of course, sales tax uh remains an issue as well with with 10% collected at the beginning of the year, I would expect that number to go up as we start seeing more from Mardi Gras as well.

Also, remember last year, because of how Mardi Gras fell, a lot of the expenses and revenue were split between February and March, we would expect to see far more of that really inherent in um in February this year.

So the road ahead, I don't need to spend a lot of time on this.

I know that uh we appreciate the council's efforts to really bring more transparency to this process.

I think you'll see at the end of the presentation.

Although Councilmember Harris mentioned that we have a number of slides introductory-wise, we have far fewer slides for the council in terms of the reporting because we've heard you loud and clear, and we're also gonna need your help as I'll mention later about streamlining some of this as well.

So um so I've asked my colleagues to maybe hold their questions till the end so that we can get through these.

Can you wait or do you want to ask now?

I can wait.

Okay.

All right, great.

That's fine.

Um look, I mean, I think the bottom line here for us, for all of us, is really targeting budget efficiencies, identifying new revenues, reducing expenditures, and managing cash flow.

Now, I painted a pretty stark picture to start with, but I I I think it was important, and this is something that Alyssa has pointed out consistently, so we wanted to share with the council.

Part of the problem last year, as all of you know, is that um what was reported versus what was actually happening were sort of two different things, and as the council repeatedly asked the questions about overtime, overtime spending increase.

So we wanted to really show you a budget tracker and what we're seeing right now.

Remember that after recognizing the additional revenue at REC, the general fund budget is close to 800 million dollars.

If you look at so far what we're spending based on January alone, so I will I will say that is one month of the year.

Um, we are projected to be 20 million below.

Now, I say projected because there's also we had to pay nine million dollars in police retention bonuses that we didn't expect.

I think council member Morel has used the term of our oopsie before.

Um there was always going to be those sort of things, and so obviously having some give in the budget is good, but I did think it was worth pointing out to the council that we are not over budget to start the year, and in fact, um are looking better.

Initial progress, I think this is one of the things I do want to spend more time in these next couple of slides, both for the public as well as for the council, because I think what happens frequently is people see what happens in budget committees or other places and not the day-to-day work that is going on.

So, in addition to what's on the slide, let me just sort of like give you an example.

Um, in my world, R and R does not mean rest and relaxation, it means reconciliation and revenue, and we are now pretty much meeting daily to discuss those things to see what can be moving and what can happen.

One of the things I asked for that we receive members is sort of the um fines and fees collected as a result of towing enforcement during Mardi Gras, that number is a little bit higher than 1.1 million dollars right now.

Uh my suspicion is it is not only a result of the drag net, but also a result of the fact that um so many people hadn't been paying, and I've had multiple people tell me my car got booted after three, five, six, eight tickets, and by the way, I didn't think it was gonna catch up to me, and it did.

So I don't know that it'll be that high next year, but the reality is that we're there, and certainly turning this over to NOPD as John Wisby's been working on religiously, is gonna help as well.

Um, quickly, uh, we've been working internally on the mayor's executive order number two, which is create budget efficiencies as well as revenue recovery.

This is some of the things that I'll talk about later, but I I it is not only a guided principle, but something that we have to work on in order to make things happen.

Um, we meet on Fridays, as I said already, with the finance office, the mayor, uh the legislative auditor on the city's cash position, and then one thing that we are hope will happen by this week.

Uh Alyssa, I think was in interviews yesterday for three hours, is hiring a controller for NOPD.

Um, we want to make sure that NOPD can do its best to police, and that sometimes means just making sure they have a partner who can help them financially, and that's with doing the overtime, with doing grants, with doing other management as well.

Um, Councilmember Morel, I just want you to note that one of the things that we are working on right now internally is trying to get ADP to match what the secondary employment office has.

I know that's been something this council has regularly requested, and like unfortunately, many things, it's not an easy fix because there's multiple systems that are trying to talk to each other, but I can say that we are now undertaking that task and um working on wrapping it up.

Uh, this next slide about sort of what we're doing, I I think really bears a lot of attention because of the fact that we are in this crisis and at the same time delivering uh the best services possible with the money that we have.

And so we've had to really look at things in an innovative way in order to make the budget work at this moment.

First, I I put on here, and again, thank the council for the release of 2.8 million dollars to fix uh lights along the interstate that will run all the way from district E to A.

So we want to make sure everybody's lights are covered.

I already understand somewhere maybe on social media that they had a before and after of the high rise that was the lights burned out, then what it looks like now that the lights are being fixed.

Um it's not just a good visual, it's a good reality for people so they can see how their money is being spent.

Um the other thing you all know about, but again, I think that bears consideration is I've spent a lot of time and will continue to harp on the fact that we don't have as much general fund or operating money as we have, but we actually have a fair amount of bond capacity.

And so, how do we take things that are general fund money and use them for bonding capacity instead?

So, one of the things I think the council is gonna vote on today is appropriating money for the hiring of 50 new uh Department of Public Works positions.

This is a really creative first to take money that has typically come out of the general funds and to use it to bring things in-house as the mayor has requested frequently, as this council has requested frequently to make sure that we can do things faster, cheaper, more in line with our residents' needs, and not have to wait on purchase orders and work orders to get those things done.

Also, you know, uh Councilmember McCarron asked earlier about what is the impact of this.

You know, doing this saves two and a half million dollars from the general fund.

And every million dollars, 500,000, 250,000 we can stack on top of each other is a win in order to make our revenue work.

Uh I have a four o'clock meeting with some of you at Board of Liquidation to uh sell the first tranche of bonds.

So thank the council again for not only passing that last year to the voters for approving it, but also working with the administration on what that will look like in rough terms for you and for the public, we'll sell a request to sell $30 million in affordable housing bonds to cover affordable housing in 2026 and 2027, sell about 20 million, 21 million in drainage bonds, um, and then sell the rest of about 180 million, 178 million for infrastructure projects as well.

Then just remember that we can go back out and sell more bonds again in 2028 and 2030.

So we wanted we're a little bit ahead of the 170 curve, we're closer to 180, but given the needs of the city and what you all asked for on behalf of your constituents, we tried to see how far we could push that envelope, and that's where we are.

The other thing on here, too, is the mayor has really pushed streamlining services.

I think you all know obviously about streamlining the Office of Criminal Justice Coordinating about youth and families.

Two of the measures, one of here that's on this slide is trying to get grants management in a single place.

Unfortunately, we have some wonderful grants managers who live in department A, maybe not as many people in department B and Department C is totally lacking.

And this is a way not only to make sure that the city knows what it's doing, to bring brighter and also hopefully better process too.

Process is slowing a lot of the grants down, and you know we probably don't need some of our funders to provide their bank accounts to the city of New Orleans in order to get things funded.

So, how do we make things better faster and working for everybody?

Um, spending controls is obviously something I'm trying to look at all the time.

One of the things I think we've all routinely heard is how change orders are happening.

Now we've revised it, so any change order in excess of sixty thousand dollars has to be approved in writing by the chief procurement officer, the city attorney, and me.

So we we're trying to be very clear at departments that do not start work.

Let me repeat that one more time.

Do not start work without this, and also do not start work without a signed contract in place.

Um that's happening too many times, and we need to make sure that we're avoiding that.

Um, as far as um departments were trying to avoid all costs were were feasible.

I think I signed my first um general fund allocation for travel, and that's because the registrar of voters needs to get the certification in order to be certified as every other clerk is in the rest of the state.

Um, and then the next part we discussed many times is is having a much more robust quarterly reporting system.

What's important for the administration, for the council, I think, and the public is not getting to the summer and learning that we have this problem.

It's seeing it in real time and making sure that we're working on all of it.

Um the other thing, too, is that we're centralizing our contracting again, just like grants, those shouldn't be living in 500 different places.

They need to be centralized and with certain forms.

And I know particularly all of you and us are tired of hearing it's stuck in law or it's stuck in a department, and this is a way to try and avoid that to make it better for everybody who's there as well.

One of the things Alyssa and others have pushed on really hard is working more with Hub, our health care consultant on trying to control costs.

Um, we are trying to wrap our arms around that.

We got an initial report yesterday that shows that the city's costs on health care were 19 million dollars higher in 2025 than they were in 24.

Um, right now, what we're being told is well, that's because of coding issues that have changed, but that's a big coding change.

It's not $500,000 or a million dollars, it's a pretty significant one as well.

Also, um, some of the claims are significantly high.

So, what we can do to manage that internally with everybody else with what's going on.

Um, personnel savings, uh, you know, I think you all know a lot of these things about what's happening with citywide hiring freeze and the exemption process.

I do want to spend a minute on the citywide burlough though, because if you all go back and you review Mayor Moreno's new direction plan, it called for furloughs up to $6.7 million, and we're at $4.2 million here.

The reason why the number is so reduced is is multifold.

Number one, some of the positions that were claimed to be uh furloughed couldn't be.

But another significant portion were things for public safety, for revenue generation, for safety and permits, um, and for equity for people who are making uh 40,000 or less or between 40 and 50,000.

Um, had we done that, we could we could have saved the city even more money.

But Mayor Moreno is intent on making sure that particularly for employees who are at the bottom of our pay scale, and for employees who have these super important mission critical things that they're being cut.

I want to pause and say one thing.

I have heard from a lot of um uh folks who are being furloughed, why am I and not somebody else?

It's a difficult decision.

And I don't want to minimize their contributions to the city of New Orleans because they are important and they're working just as hard as a police officer or somebody in revenue.

And I just want to take a moment to recognize their contributions that just because you're furloughed doesn't mean you're in the wrong department, it just means we had to make difficult choices, and you wound up in a difficult choice position.

Um, as Abby put in the slide, um, our projected savings on elimination or consolidation is actually above projections at 7.2 million dollars.

So you know that is elimination of a significant amount of physicians.

And then property management is going to move about $700,000 of its positions out of general fund into another dedicated fund as well.

So again, we're trying to save as much as possible.

The other thing I would point out to the council, too, is that the plan called for laying off 75% of the probationary force.

The Marino administration has not engaged in that yet, mainly because those positions are incredibly important and how much they add to the quality of life for the citizens of New Orleans.

Also, my view has been by saving 2.5 million in DPW, 700,000 in the funds from property management, we're getting really close to what the number would have been anyway, so it'll offset to a degree as well.

But we want to let you know that layoffs have been avoided for the moment as a result of trying to manage everything as best we possibly can and want to operate by looking at the operating side as much as possible.

All right, new revenue opportunities.

Um Kim DeLarge and others are really uh seeking their teeth into grants management and making sure that we're trying to get funds back as possible.

Uh Kim thinks that on a conservative level that there's an order of magnitude of roughly 20 million dollars the city is owed for work that's been performed under federal grants that can be repaid in the next 60 days.

The number he gave me today is that he thinks about 1.4 million has already been reimbursed to the city.

So I I think that's um an important measure as well.

I do want to say one other thing about spending while I have the time too, which is we are trying to monitor things as closely as possible.

Our IT folks discovered that the city had 500 WebEx subscriptions and only 46 people were using them.

So we got them back to 46, and it was $7,000 a month.

And again, $84,000 in a $1.5 billion budget is not the end of the world, but it is emblematic of how we need to make things less bloated and how we can make things work better for our residents without cutting services.

I am spending a lot of my quality time on the Central Adjudicatory Bureau.

Um it is really something that is more of a quality of life issue than a true revenue issue.

We have too many people who have liens, blighted property, short-term rental fines, um, uh traffic fines that just aren't being adjudicated.

So my instruction to the departments is for everybody who's eligible, bring 15 of your worst cases first.

And we're just gonna triage at a point of 15, 15, 15 per each department and just start working our way backwards.

My suggestion to them is that their method ought to be the oldest cases, the cases with the highest amount of fines and the cases that have the highest impact on public safety.

So, for example, if there's an apartment complex with 600 people, that ought to be in the top 15.

Um, we should be in very short order finalizing a cooperative endeavor agreement with Hancock Whitney to provide additional resources to the Department of Finance.

Those will be welcome help as well.

And I know the council has brought up the issue of making sales tax easier to pay online.

John Wisby is working on that right now.

I'm also pushing because there's other areas that are hard.

Apparently, after a central adjudicatory bureau, you have to wait 30 days and then come back and write a check in order to pay your fines.

I see Councilmember Harris shaking her head.

That is a problem.

And so we need to make sure that systems are set up to make it easier for finance and easier for people to pay bills they want to.

Councilmember Willard said, and I think he's right that a lot of times people just forget.

This isn't being done in a malevolence, it's just done out of forgetfulness or negligence.

And so, what can we do to make that easier for people and to prompt people in a better way?

In addition to the 20 million dollars in one-time revenue, there's these other sources of revenue that we recognize the revenue estimating conference, and we want to update you on where we are.

Out of the 29.5 million dollars from Sue and Water Board, we've received close to 20 million dollars.

Steve Nelson has a meeting set next week with Sweden Waterboard Management on the rest of this money as well as other funds were owed from sewage and water board as well.

On the Wisner funds, we actually projected about 7.6 million dollars of cash on hand, and there's 10.2.

Um we we still need to get our three quarterly payments, and the lawyers are working through trying to get that federal tax return, um, and we just need to keep on working on that.

The ARPA funds, there's some amount of money that we are seeking back from recipients, but the bulk of it is in-house.

Um, before you all ask, I and the mayor agrees with this position, is we are not putting the ARPA funds, the WISNER funds, or significant portion of a SUGIN waterboard receivable towards cash at this moment.

And the primary reason is I don't want anybody to get complacent.

I think we have more money than we do.

That is going to be something we save till the very end until we have to tap money.

And I think it is incredibly important to the mayor and to the people that you see at this team that urgency win the day that we're looking for everything possible.

Um John Wisby continues to work with others on building um parking and getting to the NOPD you'll see in the next slide.

And then, as you also know, this has been one of the mayor's high priorities.

They've sold about 46 cars at auction that yielded 65,000.

There's supposed to be two more sales of about 45 to 50 cars, so you can roughly extrapolate what it's going to be.

Um, parking collections.

I mentioned the 1.1 million already.

There's a transfer of the parking to NOPD that's well underway.

Uh there'll be two phases of this for the council.

Um, one of them is parking and towing with the goal of introduction on March 12th, and then moving ground transportation to April 9th.

The consensus, however, was to leave the financial and the clerical personnel at DPW.

Our view was that didn't need to be an NOPD function.

And so allowing that to remain in-house at DPW with the city, worked out to a better place for everybody.

Um, we are going to continue to work with our vendor on these issues.

We have issued a letter to the vendor in the belief that we are owed additional money under our contract.

That's being negotiated as we speak.

Um, the you can see on here already through seven weeks of the year, you have almost 1,300 boots that have been display deployed and close to $500,000 collected.

The other thing that I thought was important is the RFI for the new parking contract was issued actually on Lundy Gras.

So this is 45 days for people to respond.

We know there's going to be interest, there is interest in it, and obviously, how do we use technology better in order to make sure all that is happening is incredibly important to all of us, and we'll continue to monitor and let the council know what we see through that process.

Um, one of the major drivers that got us to this problem with the budget was was lack of overtime budgeting in the 2025 budget and lack of management along the way.

So, where do we stand with that?

There's about 40 million dollars that the city allocated for uh overtime spending, the supermajority of that lives in the CAO budget, so departments cannot spend it without my approval.

Um there is a team of people who are working on making sure that there is standardization of departmental overtime projections.

I have a meeting at 3 30 tomorrow with my team to go over where everybody is on their overtime projections, and really to try and get people into a more reasonable place when it comes to it.

I think candidly, a lot of the departments are probably overestimating right now their overtime because they don't want to look like that they spent too much, and it has to be a little closer to reality, and also to there may be a reason why you exceeded your overtime, but uh with a good reason and that being the exception and not the rule.

I did want to show you in the next slide the emails.

When Adam Gordon sends these type of emails, my inbox lights up with about 30 of them that he sends to all the departments, and it's to show them this is where your overtime spending is, this is what your projected spending is supposed to be, and this is where you are in surplus or deficit.

Obviously, you want to see that minus number more than a positive one, and that's what we're seeing more of.

Um at the same time, I will say this.

I've seen Adam send maybe three of these so far.

Is that sound right?

They own individually as overtime spending components.

You can see that the light blue is 2024, the darker blue is 2025, and then the orange is um 2026, and I would know for February, it's obviously what we had available at the time.

I mean, you can just look already in January, we were well below 2025 and slightly below 2026.

I mean 2024, and if you look at February, you know, the numbers are pretty eye-popping.

When you see 2024 at close to 7.5 million dollars, you see 2025 at 6.3, and right now 2.1.

That number will be higher, but you know, given that Mardi Gras was all this month that is important, and candidly, as I said earlier, Abby was reminding me so yesterday.

You really got to look at February and March of 25 together because that's how Mardi Gras was split.

And and obviously we we expect to be judged on how that split occurs and trying to manage everything as well as possible.

The next slide talks about overtime spending.

Um, as Abby and I were discussing this yesterday, the real headline here is the current spending and the fact that almost every single department is well within their supposed to be.

EMS is an outlier because of the way they reported, and they're they are actually in better stead than the number looks like.

If you want a better explanation for that, Abby will be happy to give it to you.

But the bottom line is this looks worse than it really is.

And by the way, they are they are in the black 265,000 dollars when it comes to their overtime spending as of January.

So you know, think things are headed in the right direction, but it's headed in the right direction because of the regular daily weekly controls that are being instituted as well.

Um, these are some of the overtime on slide 22, approved overtime projections, February through May.

Again, um, most departments are doing fairly well when it comes to where they're supposed to be.

Obviously, anything that's in red as a 90-day projection is of note for us, and we'll continue to manage.

I do think you know, sanitation is just gonna be high given the situation where we are with with how much we collect.

So I I you know, in addition to coming off of Mardi Gras, I don't know that's a big surprise, but we want to make sure we're managing all those numbers and reporting them timely to the council.

And again, when we come back in April after the first quarter, we should have a much clearer picture of actuals and how things are trending out.

Uh, the last thing I will talk about before pausing for questions for the chair, and I know there's Alyssa will present on the reports themselves, is um the dawn of a new reporting era, which is trying to give the council and really the public the reports that you want rather than getting a stack like this, trying to see things that make more sense that are easier on the eye that are easier to read for everybody.

So there will be um a streamlined revenue collections report, there'll be a streamlined personnel spending projection report, we're gonna streamline other operating.

The plan is to eliminate FTEs.

And the reason for that is A, that was probably 80% of the packet you were getting in the past, B, it's a waste of a lot of paper unnecessarily, just is and C, given the fact that we have a hiring freeze, there's just not going to be a significant amount of people unless either you're have an exempt reason why, or you're in a category of somebody who should be exempt.

And then we're gonna streamline fund balance reporting, and then as we have on the slide through Abby and her team, we actually have a new report not only of executive summaries for the council, so that way you can see everything more easily than not, but overtime spending as well.

And then the next thing is just asking um for some small legislative changes.

One is to remove the requirements for now to complete FTE reports.

It's just it's not going to do you any good really, and and it just seems like it's kind of a waste of time.

Obviously, we will keep you updated on anything that's significant that happens, and then edit the fund balance reports to eliminate funds with no activity last year.

So with that, I I know I I moved somewhat at a clip, but um you all had had gotten this yesterday.

I think this council knows everything that's happening.

I think everybody also knows how significant, serious, complex, chaotic the situation is and and again um trying to have a great deal of sobriety and urgency about how we work through all of this.

Thank you.

Uh thank you, CAO.

Uh Amy McCarran first, followed by Councilmember Willard, followed by Councilmember Morell.

Thank you, Chairperson Harris, um, and CAO G.

Rousseau.

I want to go back to the beginning.

So it would be the road ahead on page uh I guess this is six, slide six.

Okay.

Where you say here, all the while the repayment of the RAN and requires additional liquidity beyond typical operating expenses.

Where, if I was looking at the 2026 operating budget, where where is that accounted for?

Like the repayment and the interest payments.

Yeah, I mean, I think that's been something that's been known to everybody that it has to accomplish as part of the operating budget overall.

If it's the council's will to amend that to make that happening, so it's even clearer, we're happy to go through all of that.

But at the same time, like it's it's been something that we've discussed as part of the process of making sure that the RAN is being repaid and being honored in terms of what our expenses are.

But did we like put it in the budget to reflect and or how did we like you know, did we make additional cuts to make sure that we're paying it or or have the cash available?

I mean, I think the whole thing has been how do you balance and making sure the budget is being taken care of with the RAN on top of what it is.

I mean, the thing I think that's most important to the council, as you all know, is the budget is a breathing document, and so if we did better, then there are less cuts that would be necessary.

If there's things that change, there are more cuts that are going to be necessary.

But the reality is that the RAN exists on top of what our other obligations are, and we're trying to manage through all of those on a daily basis and provide as much information to everybody as possible.

Okay, so we wouldn't necessarily find it like a specific line item.

You're not gonna see a specific line item, council member.

Um, but but I will tell you this.

I I every night I go to bed I think about the RAN and what revenue we have on hand, so don't worry, it is top of mind for sure.

Yeah, well, especially if we may, you know, additionally need another one that you know we may want to consider budgeting for it just to have an idea of for next year of repayment and what that looks like.

I think that's a good I think it's a good plan.

So I'm meeting with PFM on Thursday to sort of discuss where we are.

Um, you know, uh I I want to make sure that we have an idea of what that might look like for the rest of this year, because the mayor has said repeatedly that there is going to be another RAN that is necessary, and how we make sure that we're all actively communicating about that.

And look, it's part of the reason we've spent so much time talking about the um expense side of what we can do.

We've also spent time talking about the revenue side.

The bottom line is we're not gonna be able to wait a cut ourselves out of this completely, and we're going to have to do some things.

Um I know I'm I'm gonna ask the council members to look at some fines and fees related to like safety and permits and code enforcement and HDLC and BCC, and apparently some of them have been raised in like 2011, 2012, 2013, 2014.

Um, Larry Bear being just just for I don't mean to pontificate, but Larry Barabino is telling me tennis during the day at Atkinson Stern is five dollars.

I mean that I I love playing tennis, but that is a very low amount to play on very well-maintained clay courts.

It's time to probably raise that sum.

So what can we do that isn't killing the public?

The goal isn't to raise it to exceed what you have other places.

The goal is to get more aligned with what 2026 realities are.

Yeah, agreed.

Um on the page seven, we're talking about is this analysis that we're talking about uh strictly looking at 2026 totals, or did any previous years account for this?

I'm sorry.

My understanding is only looking at 2026.

Okay.

Okay.

If I and so am I correct in assuming that it does not include any unfilled positions, for example, like safety and permits director, city economist.

No, it doesn't, it doesn't include that.

I I would say this though.

Um it's a very fair question, but at the same time, my hope is the city economist and the safety and permits director don't total 20 million dollars.

So but but in fairness, you're right.

Like we need to hire some more people in safety impairments.

We need to hire an economist.

And I I I think the point of this slide is less of the fact that we're hearing to dunk the ball and say we're done.

It's more of a purpose of we are really actively trying to watch things as closely as possible, knowing that there are going to be expenses throughout the year, as you point out, and trying to make sure we have a safety impairments director, that we have other people that are mission critical for the city.

And then what percentage of these personnel totals are non-genered?

I don't know the answer to that question.

I mean you can get back to us for that.

We we'll have to get back to you on the council.

On what slide?

Councilmember slide seven.

This is our general fund.

So these these are all just general funds.

Okay.

There you go.

Okay.

Um the budget creativity page 10.

Um, you talked about the centralized grant office.

Is that that's gonna be under CAO, and then is that gonna be led by a current office, or would they be there be a need for a new office and personnel, or how are you handling that?

Yeah, it's a good question.

Um, so you know, um the council push for and received a revised org chart.

I'm gonna have to revise the org chart again after only a month and 45 days.

Uh the goal is to be able to move those employees who are working on grants already out of their departments and keep them in their places where they are.

My hope to council members to have somebody who's internal rather than having to hire externally, but we'll have to see how how we go.

The hard part I'm trying to manage here, obviously, and I think we all are, is we don't want to have to spend money unnecessarily.

But at the same time, if you can spend money to save money or to even make money, then that's something that we have to explore.

But I'm waiting for Kim to come back to me on what the recommendation is on how it ought to look and function.

And excuse me, I think the most important thing is is obviously functionality first and then making sure we have a level base for what cost is too.

Okay.

Talked about the transfer to parking.

Oh, on the overtime spending comparison.

Um, I know so we had a lot of agencies outside agencies that were helping us with Mardi Gras.

Do you know how much of an impact the additional agency support played into our ability to have overtime lower during Mardi Gras?

And and is there like an overall comparison between Mardi Gras over time with that agency support and like the cost comparison of that?

I mean, I don't know the answer to that question.

I mean, you have to think most of the people who came here are deputies who are here to support NOPD because there aren't enough officers with the necessary training.

I think the total cost was roughly about four and a half million dollars to the sheriff's office, is that right?

So we obviously are using that as a resource.

And the other thing too is again trying to manage the departments through their overtime during Mardi Gras.

And A, you know Mardi Gras gonna happen every single year, so you can't have an excuse of well, we had overtime for an unforeseen event, and then B, how you manage your hours and work through that as best as possible.

I mean, I I would just tend to think that if you look the number of officers, if you had 400 more cops or whatever, the number ought to be times their salaries, times their fringe, times for benefits, you're probably getting pretty close to what we need to spend in order to have other deputies help us.

Yeah, but I mean if we're using additional deputies that aren't requiring overtime, then we should see some kind of reduction in overall costs, is what really what I'm like.

I mean wondering, but good.

One thing I'll just mention is that we use the outside deputies in 2024 and in 2025.

So looking at priority the same amount roughly.

I think it was a little higher after the terrorist attack, but roughly about the same amount.

So we know looking at year over year overtime spending, the deputies will carry for we're gonna make sense.

I think that was it for me right now.

Okay, thank you.

Councilmember Willard.

Thank you.

Um Joe, I I mean, I got I have some questions on uh on the RAN payment.

So the the 125 is not included in the FY26 operating expenses?

It is part of the city's overall plan.

It is not part of the budget book per se.

So where do we the budget's like what 790 million?

Yes, correct.

So that means we have to come up with an additional 125 plus five million for interest.

So it means you have to use all the resources that we have in order to start paying off the RAN as appropriately as possible.

And that is something that we are working on all the time.

Look, part of the reason I'm trying not to release other funds is exactly for that purpose is to is to either manage the cash flows we get later in the year or to repay what happens with the RAN simultaneously.

So it is it is trying to make sure that we have enough money in hand in order to do those things.

I've been trying to work on projections for say either savings that we're having, money that we're pursuing, operating revenue that we're looking for legislative bodies to help with in order to offset that so we get to a place where hopefully we're as close to zero as possible.

Okay.

Uh is is there a reason we didn't include it on the expense side?

I mean, I think I think the reason was everybody knew exactly where we were and what happened, and as we're passing the buttons.

I mean, again, now I'm speaking a little bit as a former council member, is I think the whole world knew exactly what the expense is, and this is not an unforeseen expense.

So it is part of what we are managing through our budget all the time and trying to make sure that we are doing, I guess, like really three or four things simultaneously.

Managing our overtime, making sure we're paying back the RAN on schedule, managing our cash flow, getting ready for probably another RAN later this year, and trying to rebuild, you know, reserves and other things as much as humanly possible.

Okay.

Um I mean, I I would I would just also for the record point out like the the council is not responsible for creating the budget.

It comes from the administration and it was not included in the last budget.

So we can talk about whether or not this council would like to change that to recognize that.

I mean, I I think it needs to be included as an expense.

And I was talking to Council President Morrell and uh with the charter amendment coming up soon.

I mean, in order for us to make payments on it, you know, if that amendment passes, it would have to be part of the budget.

I I think that makes good sense.

Um so moving on, we had about 27 million cash on hand.

Yes.

Um we have our next RAND payment, which is due Friday.

I think it's March 2nd, is that right?

There's a trance for I believe I'm gonna let Alyssa answer that.

Yeah, so we um we made our first uh payment, I guess it was two weeks ago now, and then we have another payment going in March 2nd, going out March 2nd.

So there's nothing that we have to do on the 27th this Friday?

It's already been done.

Oh, you we already took care of that?

That was just moving money to set up for the March 2nd payment?

No, there was a payment that was due.

Oh, we paid it early.

Yes, yes, gotcha.

Gotcha.

And what do we have on March 2nd?

That is to fund the reserve.

So we have 55 million.

Are we gonna have the money to do that?

Yes.

We will?

Yes.

Okay.

Um worst case scenario, what would happens if we can't keep up with you know, one of the deadlines?

Um if we have 53 million instead of the 55.

Yeah, so the that will be paid.

Yeah, so unfortunately that gets paid before other expenses will get paid.

Okay, so that's a priority.

Yes.

Gotcha.

Okay.

On the um property and sales tax collection slide.

I had a question.

Um, is that breakdown year to date, like January 1 through 220, or is that for the fiscal year?

Like is this are we looking at what we expected sales tax collections to be through 220 or for the year?

For the year.

For the year.

For the year, yeah.

This is our total expected versus what we've received.

Okay.

All right.

So in looking at these numbers, I mean the property tax has to be alarming, right?

Since the deadline's approaching, but on the sales tax side, is that kind of in line of what we expect to be at this point of the year?

Yeah, I mean, there is some seasonality in that.

So I would, you know, one would say maybe that should have been 20% versus 10%.

Um, and I have a note to kind of see if I have percentages along the way for the year.

But for the property tax, um, you know, we reviewed these numbers or these collections against last year's collections, and we're um a bit ahead of that in terms of timing.

Okay.

Um not you know, we so I I want to make this clear earlier is that it is a difference between what we received last year versus this year, and then also what we received this year versus our budget, right?

So we put a budget in place for what we thought we would receive in January, and that is what we're a little behind on, especially in keeping up with the expenses that we have in January and February, right?

Okay, so um, but for this, I I think we're on track.

There is um we see the money um that is coming in, and we can see in the bank account, it's just the reconciliation process to make sure that we can actually move those funds out and into our general fund.

Okay.

Um for anybody watching, last day to pay your property tax bills on the 28th.

That's right.

So let's let's let's get it in.

You don't have to pay the the penalty.

Um on the moot point now, but on the budget tracking slide, you categorize our spending, and right now it looks like we're at 44 million a month on the personnel side, and then 21 million a month on the operating expense side, so 65 million a month.

Yes, that's that's what we're tracking right now.

But that does not include the um payback of the RAN.

That's what I was gonna ask before Councilmember McCairn brought up her stuff.

Okay, so that probably should be revised.

Um the one-time revenue slide.

I know you said we're holding off on the sewage and water board, the wisner, the ARPA funds.

I wanted to know if those funds um the 19 million, the 16 million, are those in the budget, the FY26 budget?

They are part of the budget.

That was part of the 75 million dollars that we added for the projections.

Yes, council member.

And so again, I want to be clear about this.

And um Alyssa, tell me if I'm wrong.

I think of the 19.77 million received, we've we that was a significant portion of that was used for the retention bonuses.

Yep.

So there's about 10 million dollars left there.

There still should be the 10 million dollars left in Wisner, so that's 20 plus the amount we're uh we have on hand that we've earmarked back.

So you know, that's in the neighborhood of 30 million dollars, in addition to potentially other funds that Alyssa's looking through right now.

And again, the whole point of this is to our discussion earlier about how we're man how we're both managing cash flow and trying to repay things in the future.

And and you know, look, the anticipation certainly that we were gonna need another RAN, and this was known to everybody all along.

Okay.

Um, and then my last line of questioning is uh around overtime.

So I think you said we budgeted 39 million for overtime.

Is does that include uh public safety overtime, police fire EMS?

Yes, it does.

It does so um I might get the numbers slightly wrong, but NOPD is a significant portion of that, I think close to 24, 25 million.

Then there's another five million of this could happen, so we just want to make sure we have it around, and then I think the significant next portions are between fire and EMS and communications district, and then the small leftovers potentially for other apartments as needs arise.

Okay.

Uh and and so everybody has to come to you to get that approval for usage of overtime.

Yes.

And they have to do it during Mardi Gras as well.

Yeah, well, they're gonna come back and they'll they'll show us what their budgets were, and then you work through that budgeting process after they come back and show where they are.

And obviously, if there's an overtime problem, you're catching it in real time as opposed to allowing them to overspend as we saw earlier, and then trying to deal with it back end.

Okay.

Um, and based on what we have budgeted in actual overtime spend so far, are we looking good there or we're uh Abby's you can see Abby vigorously saying that?

Yeah, sorry, shaking our heads.

Yeah, yeah, we're we're ahead of the game right now.

Okay, and and again, you know, I I will say for the departments, two things I do feel like they've they've gotten the message on is travel.

I'm not really seeing travel requests that aren't grant funded, and on overtime.

So those are those are things where I think the council, together along with Mayor Moreno, have made significant strides in pressing upon departments that you have to manage this in a different way.

Okay.

And and just to be clear, we're under what we were projecting over time to be so far.

Correct.

Okay.

Thank you.

You're welcome.

Thank you, Councilmember.

Councilmember Morale.

Thank you, Madam Chairman.

Uh, not to beat the RAN reconciliation to death, because Bob and wrapping my head around it, Joe and I, we were both lawyers, not accountants.

Um I don't think it's as dire as it appears, because it's basically a revenue swap.

So the 129, the the 125 million that we borrowed, we're using that money to pay down expenditures that we already budgeted for.

So really the what has to be reconciled is any RAN payments that were done before this fiscal year are just debt.

Because since we weren't since we're pay using the RAN payment, the the RAN fund for this budget year to pay the debts that were due last budget year, that legitimately is money that we did not account for in this year's budget that we paid to get through last year.

So we have to reconcile that and we have to reconcile the interest payment, but it should be a one-for-one swap because paying the salaries of the police we had to pay anyway, that would have been paid by the collection of the sales tax and inc and property tax that have been done timely.

But to Councilman Willard's point, the problem we're gonna run into is that as we go for the next RAN in June, I anticipate that RAN is gonna be beyond potentially that existing fiscal year, which is gonna compound the problem.

So we're gonna have to figure out a mechanism in our budget if rands are gonna go beyond the existing fiscal year to reconcile them in real time because if the RAN goes from the 2026 budget till January or February of 2027, that is gonna be proved to be problematic.

So I think we are gonna have to work with y'all to figure out whether it's establishing a RAN repayment fund or just somehow we're gonna track it because it kind of broke my brain for a second, but since we're not, even though it's a one-for-one swap of revenue, we don't budget writing the check to repay the RAN, which is gonna be problematic if the charter amendment passes because we cannot pay bills that we don't acknowledge our bills.

So it's gonna be complicated, I'm sure between Abby and Alyssa and everyone else in Brandy, they'll figure it out, but we're gonna have to figure out a mechanism to acknowledge it, otherwise we can't pay it.

Yeah.

So council member, two points to that.

One is one of the things to obviously we'll have a better handle on is what the fund balance looks like as well.

Right.

You know, so I think obviously you don't want to dwindle that any further, but if we get into a situation, you know what that money is.

And then number two, this is a first for everybody here.

Um I I don't know that anybody has served in a capacity needing a RAN.

So we're always open to working in a way that makes it better for everybody else.

I'd also probably argue the fact that we know that we need another RAN will mean that it gives us more time to work with lending institutions on what repayments look like, what schedules look like, because remember, this was this was done Council Member Morel, how long we we we basically had a two or three-week window, we have to figure it out.

Correct.

So I mean I think it's just as I said, we'll we'll figure it out.

We have to figure out a way in our budget to acknowledge Iran exists and that we have to make payments just so that we don't want to file the potential charter amendment, which is gonna require that.

Um council member, can I just comment?

Yep.

I want to say I agree with you, but I just want to make sure we also recognize that we also did not bring in the RAN as revenue in the budget either.

So it recognizes and recognition recognized coming in and we're not recognizing it.

Well, I think that's what's causing the confusion.

Because like I think if you look at the RAN as a pure debt, it would appear the budget has grown by 125 million.

But the reality is that there are items within the budget we use the RAN to pay for, with the idea being that when the income came in later, by repayment of the RAN, it would be an even swap.

It's never gonna be even swapped because we owe interest, which has to be accounted for as a debt.

And as I said, because of the nature of when this RAN started, we're using money in 2026 to pay essentially 2025 debt because we ran out of cash in 2025 to pay 2025 bills.

So we're gonna have to recognize and adjust our budget because that's just money we lost.

That's we would not account for the 2026 budget.

So I think it's gonna be incumbent upon us to work together to figure out how we recognize it, how we adjust the budget accordingly, because we spent God, Brandon, you would know offhand probably 20, 30 million dollars before the fiscal year started.

That's just 30 million dollars that we don't have.

So effectively that makes our budget 30 million dollars more in expenditures that we have to have cuts or have new revenue to replace.

And like I said, if the RAND for 2026 goes into 2027, January or February, we're gonna have to recognize in the 2027 budget that money's that the debts parts of it are gonna carry over in the 2027 and budget for it.

But I want to go back to page uh 16 on the RFI on parking.

Yes.

I know I appreciate and I'm glad you're going out on an RFI for parking.

I want to kind of bring something to your attention.

The current parking process is an absolute nightmare.

I mean, the the app that's not an app, the website you go to, the fact that people literally I see them on the street trying to pay their parking, and because the app is so dysfunctional, sorry, the website, they eventually get frustrated and leave.

I think the challenge we have is that there is a mentality often in government that whoever gives us the cheapest product with the most return is the best option.

And what I would say is I do not think that's correct.

I think that whoever we respond to this RFI, we need to focus on how user-friendly and how easy it is for individuals to actually pay their parking timely and on the spot.

Because as many of you know, when the meters were first installed, the same parking companies that run our lots ran our meters, and it was a singular app that covered both the street parking and the lot parking, and that made it very easy for residents and visitors to have one app to negotiate all of it.

What I would suggest is if you're doing that RFI, focus on the ease of use because we are losing money when a frustrated person wants to pay their parking, can't pay it, and just walks inside.

That point, we're kind of hoping they get a ticket so we get the money, but I guarantee you we're probably losing out all a lot of that money because the ticket never happens and that person never pays.

So just focus on making sure that as we try to find someone who could do all things, they do it in a way that's functional because I promise you there will be low ball responses that are gonna be fly by night nightmares like what like what we have now that is non-functional.

Um also council member, I'm sorry, just to interrupt you.

Um the part of me that wanted to move fast on this wanted to debt this done in 30 days.

The part of me that was we have to get it right, agreed with my internal people that we should make it 45 days.

Yeah, I think exactly to that point.

Um, page eight, um, and what is the status of the comp troll with an OPD?

Um they interviewed, I I I think you may have had a sidebar in this, but they interviewed three candidates for three hours yesterday, and I think is the chief getting ready to make a recommendation to the mayor.

So I mean, this was kind of like it's it's kind of a uh bullet point on the slide, but I cannot stress how important it is for the council that NOPD have a comproller.

Because I think part of the problem, the reason why their budget has ballooned to the point it's ballooned, the fact that we've had a tremendous amount of overtime problems to be candid is because like many departments, they would spend money and just debit it from the general fund, and there's no one in there who's saying, well, maybe we should not spend this money.

It's just we'll spend the money and the bean counters will figure out what they have to cut to make the budget work.

I think that as we transition this fall, hopefully, to that ironclad locked budget, NOPD is gonna run into a problem without a comproller because if they overspend, there just won't be any money.

And I don't think that has really sunk in yet with an OPD that if we budget you money and you start spending money that's not there, you will just run out of money and there will be no money for you.

And a comproller needs to be sitting on top of them saying, No, if over time this month runs over, we can't do this other thing that you want to do.

And I don't think that's really sunk in yet, in my opinion.

So I think it's really important at our next budget meeting, and I hope the chief is watching, we need to know who the comproller is.

We need to feel like as a council they are empowered to actually tell you no, and that the budget is going to follow a budget and not just be the council and the mayor will have to figure out what they have to cut because NOPD went over budget.

Um, council member, my hope is to get that to you before the next budget committee.

Well, I'm I'm gonna be cautiously optimistic and say just hope before the next budget meeting.

Yep.

Um, last thing, we have gotten a tremendous amount of calls on SPCA.

And because we've gotten so many calls, I know I've had sidebars with Councilman Jeruso, I don't know if Dr.

Avegno is here, but we've really kind of dug into this issue to a greater degree, and I have a lot of questions I want to pose to you guys because you're the ones the council allocates money, but you guys are the ones and the CEA in charge of interacting with SPCA.

And I want to start with one simple fact.

The CEA we have with the SPCA is not actually with the SPCA, correct?

Who is the CEA with?

It's with a group called NOHLR.

And my understanding is the reason why we have it with this, I believe it's an LLC, correct?

That's correct, Council.

With the LLC, is because the L the SPCA had concerns that when they receive public dollars, they would be subject to public records requests, correct?

It was to make sure that they were not, as I understand it, subject to public records.

And I guess the the the questions I have, one, so as I understand it, because they have the CEA, there is no commingling of funds.

So our money that we give them for their specific CEA purposes is separate from their actual budget itself, correct?

That's how it ought to work, Councilmember.

Okay.

I want to highlight one thing first, and this is very important for people, the the 10 people who are watching, although you Gene thinks it's like a thousand.

Millions.

But for the billions that are watching for a lot of people when you see the SPCA using this crisis to fundraise, and you give money to the SPCA because of the city's shortfall, that is not going to this LLC, it's going to the SPCA.

If you donate on their website, it goes to that.

By their own CEA, if you think you're giving the SPCA money to help with its shortfall, it's just going to their $4 million.

What should we call that?

Their $4 million balance that they have because they are $4 million in the black separately from the money that we give them for their actual services, correct, Councilmember?

I'm not a council member anymore.

Sorry, please.

That is examine me just like I was one.

But um yeah, that yes, your call.

So I guess what I want to tell the public out there is if you're donating money to the Louisiana SPCA in Algiers to help with their city shortfall, by virtue of the CEA, it's not going to city services, it's going to their $4 million in money that's sitting on that side of the ledger, not the city side.

Unrestricted.

Unrestricted.

So the reality is that if they really wanted to get money raised to help facilitate and subsidize the city part, they would actually be raising money for the LLC, which is not what's happening.

So that's part one.

Part two, there's a couple of line items in there that I'm really struggling with.

As I understand it, uh Joe, we buy the vehicles for SPCA.

That's correct.

Right?

That's correct, Councilmember.

Why are we being charged depreciation for vehicles that we bought them?

I I was in the mayor's office with you when I saw that for the first time, and that was a surprise to me as well.

In fact, I I was the one who said what is this depreciation?

Yeah, so I think we need to ask the SPCA why are we paying depreciation on vehicles we bought you?

Agreed.

Um I also would like to note that though the SPCA has a separate, very public contract with Jefferson Parish to provide pickup services separate from the shelter that Jefferson Parish runs separately, their scope, their range goes across multiple parishes in Southeast Louisiana.

If we're having 400,000, I guess the number, am I correct, Mr.

Sierra?

The management fee, Councilmember you're referring to is 444,189.

I think this is kind of reminds me, and I hate to use this, I hate to tie anyone to the sheriff's office, but I'm gonna have to go there.

When we got these similar line items from the sheriff's office where they're kind of general and not specific, I need to know what is the management fee and what are we paying for.

With the overhead, I need to know what is the overhead and what are we paying for?

Because part of the issue is that the SPCA, in its private capacity as a nonprofit in Algiers, operates its building.

We pay them money to subsidize that operation for the services it provides, but we need a breakdown of how much it costs to operate their side versus our side, because for example, let's say the electric bill for the SPCA in Algiers.

If that's for a building that's their building that does multiple things, the city should be paying its pro rata share of what it owes, not of just the general expenditures because that is what their balance is for.

So I mean, I think what we need right now is we need a tremendous amount of additional information and breakdown because the reality is that if going back to that really staggering number, because I think I want to rehit this for everyone to watch.

Why is the city paying depreciation for vehicles we bought for the SPCA?

That would be like the city paying itself depreciation for vehicles in our pool for the NOPD.

It does not make sense.

And if they're just being used in Orleans Parish as they should, this depreciation numbers, they're very, very high.

So we need to get an answer on that.

The last thing, and I bring this up particularly because it has impacted a lot of us during Mardi Gras.

This horse fiasco is a fiasco.

Um it came to our attention.

First off, there was a tremendous amount of misinformation from the Carnival crews because first they were told there would be no inspections because the council had eliminated inspections.

I'm here to tell you, and the SPCA was at the table, so they should know when the council repealed the new additional enhancements for tag operations, it wasn't a separate part of the law from the existing requirements for there to be inspections.

So when we repealed those enhancements, the old law remained the same.

So one, the council never repealed any inspection requirement.

But the second issue that was equally troubling is that there was a messaging going out that the administration or the council had line itemed out the inspection of horses.

I've looked over their budget.

Is there a line item we were ever presented for horse inspections?

No.

So how could we eliminate a line item that never existed?

Uh the only answer to that question is that they made decisions based on what they were going to fund or what they were not going to fund.

And at any point did the SPCA reach out to the administration before the Mardi Gras season to say, here is how much money we need to do horse inspections.

I'm unaware of that.

I am aware of traffic going on about what's going to happen with the horses, but I'm unaware of there being something specifically unless I missed it along the way.

I I know because we're copied on all the emails that a tremendous amount of groups to provide services are very aggressive and proactive in telling the city in real time that if we don't provide additional resources, they can't do X, correct?

Correct.

Oh, yes.

I am unaware of ever seeing an email from the SBCA that was copied to this council saying if you don't find us $20,000, we can't do horse inspections.

I say this because while there seems to have been a zeal to create a problem, I can't find any record of the SBCA trying to find a solution.

And it's troubling because, and I Brandy might know this number.

What is the what is the current what is the current allocation the council had for 2026 for the SPCA?

2,3,254.

Okay.

What is the current allocation the council has for 2026 for JJIC?

3.4 million.

So I say this because JJIC, if you don't know, is our juvenile correction facility.

In a budget crisis, every department in the city of New Orleans had to take a cut so that we could have a solvent budget.

Just like we don't want to limit resources to children who are incarcerated, we had to ask everyone to figure out how working with us, we could do more with less.

And we tried working with them, Councilman, but I do want to go on the record with this.

So at the budget committee meeting in 2024 in preparation for 2025, the SBCA made a request to move forward with increase of the rabies fee.

Council agreed.

They made no movement on it at that time.

The same request was made in 2025 in preparation for the 2026 budget.

They had a meeting with myself and former CAO threat at the end of October last year.

Again, it was agreed, and I had another meeting with now CAO Jeruso and Dr.

Avegno at the end of December, and there was a fourth time where we agreed to move forward with the rabies fee.

And Dr.

Avegno now is because they have not moved forward, she is now moving forward, trying to redraft the board.

And to be clear, because I've seen the timeline on emails, as far back as December of 2025, this city was trying to work with the SPCA to raise the rabies fee.

As recently as February 2nd, Dr.

Avegno was still harassing the SPCA to get what the number was they needed.

She did not get a response until February 18th.

So that is almost two and a half months after the city has been pressing to figure out how to give them more resources.

But in this instance where the city is trying to figure out ways to help the SPCA help itself, the urgency in solving the problem is on the record one-sided.

The city is trying to help solve the problem, and the SPCA is running to the media to say that we don't have the money and no one wants to help us.

We're trying to help you maybe respond to your emails or answer your phone.

Councilmember just put a finer point on that.

I mean, I I have spent an inordinate amount of time asking people to make sure our funds are reconciled, make sure we're collecting our receipt receivables.

How do we raise things that are revenue generating for the city that makes sense?

So the idea that SPCA is being treated any differently than any other department or agency is simply incorrect.

And to that point, we tried to offer a solution about the rabies tax.

I Dr.

Avegno and I met with SPCA three days before Christmas.

Okay.

So this is this is something we are taking seriously, want to take seriously.

Um, but it's help us help you.

Well, and and to be clear, because I know that I'm infamous for this, I have the receipts of the fact the city has been actively trying to help the SPCA solve its problem, and pushing those solutions has been one-sided by the city, this council, and this administration.

Anything we could do in ordinance to help generate revenue, but to have a narrative that somehow line items that don't exist were cut, or that the SPCA is being singled out.

There are departments across the city that service the people of the city that are all being cut because we don't have the money to pay them.

And certainly with all those departments, the city is aggressively working to try and make them whole.

The SPCA is no different.

If they want to come work with us on solutions to solve their problems, we will help solve their problems, but we can't help you solve your problems if you don't answer your emails or answer your phone.

So that's all I have, Madam Chairman.

Thank you.

Um and if I'm correct, the current CEA with the SPCA in the city requires them to be open five days a week.

That's my understanding, Council.

And they are out of compliance with that CEA.

That is also my understanding.

I can tell you as a district council person and a person who loves animals and dogs in particular, we're getting complaints from other rescues about the lack of urgency and activity for the SPCA, and it's troubling since they do have an unrestricted fund balance seemingly that they could use to backfill some of the funds that were cut from their budget.

Yeah.

And look, Councilmember U and Councilmember Morel and others have raised extraordinarily legitimate questions along with this.

What is the depreciation?

What is the 444,000 dollar management fee?

Why is there 627,000 overhead fee in addition to a maintenance and repair fee of 174,000 dollars?

One would think that maintenance and repair is part of your overhead already.

So I think there are legitimate questions that we should pursue together, and hopefully we can be good partners and find solutions to those with SBCA.

Thank you.

Back to your slides.

So the current cash that you're seeing here, and this is a weekly number, right?

So moving forward, we're projecting to go through April.

Okay.

And then on the collections side of it through property tax, et cetera.

Um do we know if all the property tax bills have gone out?

Yes, those were sent.

Okay.

I mean, they were late, but they I mean, well, I let me take that back.

I don't want to say that.

That's not fair.

They went out on the time period for which they ordinarily went out, and for this year, we will see more urgency about all of those going out.

That is a fairer answer.

And I see that we have signs outside where you can come and pay your property tax bill right now through a drive-thru.

Uh yes, and it seems to me that in the lobby of the building, you're seeing a lot more traffic, which is also suggestive of people paying their property taxes here.

So to the point of that, I think any fines or fees, and I know you're gonna uh hopefully um computerized that system or make it make it available so that fines and fees other than uh what we're collecting now can be paid online, automatic monthly payments.

I mean, these are things that a legitimate business has and has had for the past 20 years.

We need to get this set up immediately.

I I 100% agree with you, Councilmember.

On the issue of fines and fees, I do want to work with you on raising HCLC code enforcement fines.

Everything that we can do to make sure that we are hitting the state levels, and if we need to go to the state legislature, I know that Amy Freeman is is has a bill to raise some of those fines, so let's work on that together to make sure that we can get the first time.

Look forward to that.

Yeah, I met with um the city services team today, and specifically DCC HDLC mentioned that there's probably some CPC safety and permits.

I think I think they said almost across the board, nothing's been raised since 2014.

So uh again.

Well, the hard part, council members, I know that we're all very sensitive to not wanting to increase burden on residents and to put this all on their back, but at the same time, you can't suspect 2026 services at 2010 prices.

Yep, thank you.

Well put.

Thank you.

Uh finally, when do we anticipate um knowing what the Mardi Gras expenses are versus revenues?

What do you think the answer to that is?

I'm looking at Alyssa, you just closed out um uh January December, right?

So we're working on we're working on closing January right now, so it could be at least another month and a half before we can get some really good numbers that um that we can stand on.

Yeah, I mean, to Councilmember McCarron's point, we need to know the final overtime number.

We apparently had a blockbuster Mardi Gras, but we also had a blockbuster Super Bowl, and and that didn't pan out the way that we thought.

So as soon as you can get the those numbers reconciled, please let us know.

Yeah, I think we'll have overtime a lot sooner, just because this payroll this week is the final one on Mardi Gras, but the expenses that flow through with it, making sure invoices are um you know are submitted and then paid is when we'll really want to fine-tune these numbers.

Okay, great.

Councilmember Green, Councilmember Hughes.

I just have one question of you, and thank you for your presentation.

Um we see in this package a $700,000 increase in sanitation expenditures over last year.

Yes.

Could you just talk to the public?

Because I don't think that the public is sometimes aware, and I want them, I want us all to be more aware.

Based on what you see and what you project, what kind of shortfall do you see in terms of what we collect in our sanitation fee versus the expenditures for sanitation this year?

Thank you for the question, Councilmember.

Um it's a significant difference in the tens of millions of dollars.

And I know for residents, this is a very difficult thing to understand because the typical resident says, I'm paying for twice a week service and I'm only getting once a week pickup.

But the reality is at the end of 2021, after Hurricane Ida hit, numbers I saw last were that the city was only in the red about $600,000 when you compare the fee that was first put on residents in 2011 or 2012 versus the total cost of all the contracts.

I think for all of us, and I think that's mainly uh council uh now uh Mayor Moreno and myself remember the total chaos after Ida and how difficult it was getting trash picked up, and I don't know who else was similarly situated, but remember when the new contracts happened, there was a service area that got addressed first with one provider, and then another service area that got split later.

So when I was the council member for district A, half of my district was getting regular once a week pickup and almost no complaints, and then the other half of my district was struggling until a new provider was put into place.

The reality is the prices have not changed since 2012, and the contract prices have shot up in the years since 2012.

The contracts were initially negotiated.

I think the last time I put pen to paper and this needs to be stress checked a little bit more, but between 22, 23, 24, 25, and look a little bit at Brandy here, I think the city was in the red 86 million dollars or something along those lines between the contracts and where we work.

If you're running about 20 to 25 million dollar difference, that's that's the delta, the difference between those two numbers.

So the hard part is that we we all want to provide really good services.

I think for anybody in particular who's elected who remembers a very difficult situation, you know that sanitation is a crucial city service that needs to be delivered.

At the same time, I think um we need to have a very robust discussion with the public about what happens in the past, what happened after Ida, what's happened in the future.

I think Councilmember McCarran was almost talking about like a you know whiteboarding of explaining things are very easily written down.

So people can understand Council Member Hughes, you've raised it before too.

Something akin to a one-pager that can just very easily look at, explain, understand that where we were in 2012 is different than where we were in 2021 and is vastly different than where we are in 2026.

And I'm asking the same, yeah, just as I talked to you about it yesterday.

A one-page or a pretty simple explanation as to what costs have increased, for example, since the original contract, we as a city have decided that we wanted the workers to earn $15 an hour versus minimum wage, which is what some people were being paid.

We wanted vehicles that didn't leave juice in the community, that they were different type juices and there were no juices, and that also we wanted to see uh vehicles not been put smoke into the atmosphere.

We wanted them to be more energy efficient.

And um, there were some services that I just want to ask you to be as complete as you can, and I know you will be to the Marino administration explaining to the public why we'll be seeing each month, unless we do something about it, a significant deficit relative to sanitation.

Yeah, and and council member um, and I'm looking now almost particularly at you and council member Hughes.

We know about all the issues not only with regular pickup, but how many complaints do your offices get about dumping and tires and other things that ultimately falls to sanitation to clean up as well?

So the the bottom line is the council has been extraordinarily clear, I think to a person that having a very simple one-page, easy to understand explanation, whether you post it on your social media, you release it as part of your um weekly or monthly reports, whether you hand it out neighborhood meetings is crucial.

And I want to make sure that we work with the council on providing something that's very simple and explainable to the public.

Okay, thank you.

Thank you.

Uh thank you, madam chair, uh, for your graciousness.

Really quick.

Um, Mr.

CAO, uh going back to property tax real quick.

Yes, um, I know in the past, uh, residents uh, for example, uh in district EM there were satellite centers for drop-offs.

My library is currently closed, so uh, do we have satellite centers for drop-offs?

And if we do, can you get that to my office so that we can get those out to the public?

You got it.

I see Alyssa's shaking her head also.

Yeah, and there was a press release that went out this morning with those locations.

Just send it to us and we'll we'll make sure we push that out to our residents.

Perfect.

Thank you.

Thank you, madam chair.

Thank you, council member.

You're welcome.

Uh I know there's more to the presentation.

Yeah, you all want the rest of the presentation.

Let's get going.

All right, I get uh uh Alyssa, do you mind presenting the last section?

Sure.

And um I I will likely be brief here in my presentation, mainly because I do want to um remind y'all that this is a preliminary look at the year-end numbers for uh 2025.

The Department of Finance is still working to finalize that data.

Um, and while these numbers are still subject to audit adjustments, we anticipate that the final deficit to change due to accruals that could be up and down, right?

So we're expecting some revenue adjustments and also expense adjustments, and then some grant reimbursement timing.

Um so our goal is to have a complete look at this with um the June 30th deadline for the audit.

But um for today, we will show you a preliminary look at um and also an executive summary.

And um, so we did make a few changes to um hopefully summarize the data and um easily show and unfortunately in this case easily show the 126 million doll spending deficit for the general fund.

So this is 2025 general fund, and our um we had budgeted for a 90 million dollar deficit, and we are in fact at this point in time at 126 million dollars revenues are just um below budget at this point, but we do like I said, we do expect some further adjustments to come with our final sales tax adjustments uh for the year, and uh personnel costs exceeded projections by 72 million dollars while other operating expenses came in under budget, total expenses still exceeded the budget by more than 21 million dollars on the next slide.

Here we have a visual comparison of our line item revenues versus budget.

So the darker blue being the actuals and the lighter blue being the budget.

At this point in time of our report, we're just at about 98 percent reporting, where you can see that biggest gap or changes in the second set of bars in other taxes.

So again, as of this point in time, we're at 98% of the budgeted 2025 revenues, and then um moving into our spending reports.

We have combined personnel and operating costs again, exceeding the budget by 21.6 million, and this is just a visual of that for us.

In the future with these graphs, I would like to present or um add an additional column for the prior year so that we can all kind of be on the same page as comparing it to budget, but also comparing it to prior year.

And of course, if you like these types of graphs, or if you have any feedback on these graphs other than the one I just suggested, we're happy to make those changes for next month.

On the next slide is just a snapshot of the FTE report.

Um, it shows that we had a vacancy rate of about seven percent or three hundred and forty-five positions unfilled.

And then on the last slide, just kind of sums up and wraps up our year where we had in 2025 unaudited.

I just want to keep mentioning that, but the consolidated general fund balance is now at 60.5 million.

So if you remember, we started at 205.6 million, consolidated fund balance, had a deficit of 145 million to leave us at 60.4 million for the year unaudited.

And that completes my report, and we'll entertain any questions.

Thank you.

Any questions?

Councilmember McCarron.

Um, I I know we just talked about in the previous, I think you were asking the complete FTE reports.

I I don't think we need to see like the details, the one that was like a million pages, but it might still be nice to see the departmental breakdown of the FTE report.

I spoke about that a little bit.

I'm gonna show her that report so she can see that one pages.

Yeah, it's like one or two pages, not the detailed for every single position, but I think it's still helpful for department breakdown.

Is that in our recommendations?

Any other questions?

FTE.

All right, with that, you are free to go up.

Go ahead.

Oh wow.

So good job.

All right, thank you.

Thank you for you.

Ashley?

So we have number four, the reporting requirement presentation from the director of finance.

It's already at the table.

That's what she just presented.

So we can move on.

We can move on to number five item number five.

Number five is ordinance calendar number 35,336.

By council members Morrell, Willard, McCarron, Green Us by Request.

It's an ordinary to amend and reordain ordinance calendar number, ordinance number.

30,532, Mayor Council series and title and ordinance.

Providing a capital budget for the year 2026 to affect the following change to the 2026 capital budget to de-appropriate funds from the Department of Public Works.

To appropriate them to the to the Department of Public Works and otherwise with respect there to Council President Morel, are you handling this one?

Yep.

Mr.

Large, before you leave, in case the council members have questions about calendar number two.

This capital budget request.

And we have another one, 337.

Okay.

You got it covered?

I got covered.

So this is the swap as I recall for using the bond money for the street cruise.

Is that correct?

Yes.

All right.

That I just summarize that I move approval and I get a second.

I'll second.

That's three A's.

Four years, no nays.

And just for the record, both ordinances are on the regular agenda for the council meeting tomorrow.

So we'll just have to state that the budget committee recommended approval.

It would not appear on consent.

I'll move on the next one as well.

All right.

Wait, this is like this is actually gonna redraw that.

This is Councilman King's order.

Number six is calendar number 35,337 by Councilmember King by request and ordinance to amend and reordain.

Go ahead.

Oh, ordinance calendar number 30,532.

Entitle and ordinance providing a capital budget for the year 2026 to effect the following change to the 2026 capital budget to de-appropriate funds from the Department of Property Management and to Sanitation and to appropriate funds from the Department of Parks and Parkways and otherwise provide respect there too.

It looks like it's moving 750,000 of 2021 bond money.

It is for the municipal auditorium.

You can add my name to it, and we can go ahead and I'll move.

We can add everyone tomorrow.

All right.

Second by councilmember McCarron.

All in favor?

Aye.

All right.

And again, both of these will be reported favorably, but we have to revote on them anyway.

Yes.

And last but not least, we have number seven, which are all of the pay plan motions.

We can go ahead and defer those for now.

Alrighty.

Items number seven A through L have already been deferred to March 12th per the agenda, the regular council agenda tomorrow.

So we can just defer M through T to the 312 as well.

Perfect.

And with that, Councilmember Green moves to adjourn.

Not officially among you're not uh well he supports it.

I'm pleased to be here.

Always uh council member McCarron moves to adjourn.

Council President Morel seconds, all in favor.

All right, we are adjourned.