As city heads toward $100M deficit, watchdog group urges planning
By Rachel Handley
Source: WWL-TV
September 11, 2025
NEW ORLEANS — A report released by a local government watchdog highlights the City of New Orleans’ growing budget deficit, which is on track to top $100 million by the end of the year.
“There’s a concern about looming costs in 2026 and beyond, as well as declining revenues,” said Stephen Stuart, Director of Research and Senior Vice President for the Bureau of Governmental Research, a local nonprofit focused on city policy and resources.
On Thursday, BGR released a report titled “New Orleans Needs a Sustainable Budget to Meet Residents’ Demands.” It uses data first published by the group in the spring, adding that “the 2025 budget is on pace for a $100 million deficit as revenues are coming in low and overtime costs have soared.”
The report attributes those overtime costs to the Bourbon Street terror attack and the January snowstorm.
Over the past few years, federal COVID-19 relief money has made up for budget shortfalls, Stuart explained in an interview with WWL Louisiana. But it is running out, and the report said the City’s 2026 budget “will in a sense be the City’s first truly post-pandemic budget.”
BGR urges city leaders to create a five-year plan, with the goal of implementing what is called a “structurally balanced budget”– a budget that balances the upcoming year’s revenue and expenses without taking one-time revenue sources, like the option of dipping into the city’s reserves, into account.
Without a structurally balanced budget, the report warns future budgets “might not provide sufficient funding for certain City responsibilities.”
Stuart gave the example of roadwork. “The City, right now, funds only part of the street maintenance budget that it really needs to keep up with repairs, potholes, and other things that need to be addressed,” he said.
Meanwhile, deadlines are looming for the city’s 2026 budget. The Mayor must submit her budget proposal by October 1. The City Council must approve a final version by December 1.
The October 11 election is also just a month away. “The current administration and council have a responsibility to address these challenges and hand off a more financially secure City government to the incoming leadership after the elections this fall,” the report reads.
BGR sent surveys to mayoral and city council candidates earlier in the race, asking for their stances on various issues, including the possibility of a 5-year budget plan. The three frontrunners – Oliver Thomas, Helena Moreno, and Royce Duplessis – with some caveats, all said they would support it.
Still, Stuart cautioned that there will be no quick fix. “These are long, long-standing issues that have been needed in New Orleans for the city budget. They will take time to implement,” he said.
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