In The News › Fix My Streets group gets crash course in city finance; new taxes under consideration

Fix My Streets group gets crash course in city finance; new taxes under consideration

By Greg LaRose

NOLA.com | The Times-Picayune

January 19, 2016

A panel of city government and community representatives has been tasked with answering some of the most daunting questions facing New Orleans since its Hurricane Katrina recovery: How will the city pay the estimated $9 billion cost to upgrade its substandard streets? And where will the money come from to maintain its improved infrastructure?

The Fix My Streets Financing Working Group, the appointees of Mayor Mitch Landrieu who are seeking answers to those questions, held its second public meeting Tuesday (Jan. 19) at the New Orleans Mosquito, Termite and Rodent Control Board building. Its members from neighborhood organizations and the business community received what amounted to a crash course in city finances from one of its City Hall members.

Sewerage and Water Board executive director Cedric Grant made a presentation on city infrastructure spending and debt with help from Norman Foster, the New Orleans’ chief financial officer, and Bob Miller, who holds the same position with the S&WB.

In short, Grant’s message to the group was that the city’s improving fiscal health and a recent billion-dollar boost from FEMA will allow it to continue and expand an extensive slate of recovery projects. But for the rehab work to reach deep into neighborhoods where it’s needed the most, the city will need to continue collecting property taxes at current levels — and possibly ask for more.

Members of the working group questioned whether the closer look they’re expected to take at city finances should result in finding additional resources or new spending priorities.

“It appears you’ve done all you can with what you’ve got. Ultimately, are we going to need to find new sources of revenue or find better uses of what we already have?” Damon Burns, a municipal bond broker, asked Grant.

Grant said he expected the improvements to free up money now being spent to maintain failing systems. In addition, the city’s ability to obtain additional bond financing will improve as it continues to retire outstanding debt, he said.

Although the working group is expected to offer guidance on what Grant called “traditional methods” of financing infrastructure projects, he said other methods should be considered. He added that a “sizable portion of the community doesn’t pay property taxes but enjoys the benefits of the drainage system,” which is undergoing a massive overhaul Uptown. Grant’s comments, though indirect, indicate a change in policy could produce additional revenue for infrastructure repairs.

During the public comments portion of Tuesday’s meeting, Celeste Coco Ewing, president and CEO of the Bureau of Governmental Research, recommended working group members evaluate the nonprofit watchdog’s most recent report on city tax dedications. While stopping short of suggesting how the city spends its tax revenue, the report from November examines how scarce resources in some areas of city government are offset with flush coffers in others.

Ewing noted, as city officials have in the past, that only 3 percent of the city’s general fund is devoted to street repairs.

Members of the public attending Tuesday’s meeting had a mix of questions for the working group, ranging from those that aligned with its fiscal mandate to specific ones about when street and drainage repairs could be expected. Answers to their questions were limited.

Alicia Plummer, an eastern New Orleans resident, asked Grant whether FEMA’s recent agreement with the city to provide $1.2 billion for street and water system fixes makes the city’s incremental service fee increases unnecessary. An annual 10 percent hike in water and sewer bills went into effect in January 2013 and will continue through 2020. Plummer said the FEMA funds “double” what the city is already collecting while citizens are “getting poorer and poorer.”

Grant and other panel members did not offer an answer to Plummer’s question and others from the audience, leading group member Eric Songy, president of the Bocage Neighborhood Association, to request a more formal process for fielding questions at future public meetings.

Lakeview developer Robert Lupo, founder of the Fix My Streets movement and part of the working group, noted the panel is strictly charged with finding financial solutions for future infrastructure needs.

Attendees with street or drainage problems were referred to a representative of the city Department of Public Works who was at the meeting. Citizens were also advised to track street projects in progress at roadwork.nola.gov.

The pecking order for road repairs is expected to come from the city’s ongoing pavement condition survey. Camera-equipped vehicles have been traversing New Orleans streets and evaluating their condition. Data from the survey will be used to assign a score to each street that will be used to rank repairs.

The working group will have access to the rankings to help it determine what resources are needed to do the work. It is expected to hold additional meetings through February.

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