How short is the New Orleans budget? Depends who you ask.

By Ben Myers

Source: The Times-Picayune | Nola.com

September 19, 2025

As New Orleans Mayor LaToya Cantrell’s administration prepares measures to address the city’s budget deficit, there is confusion over what the shortfall actually is.

Officials tossed around various numbers at a City Council budget committee meeting this week, without explaining how they were different. Council members asked about the 2025 budget deficit; administration officials responded by discussing the fund balance deficit.

The 2025 budget deficit — the difference between the budgeted expenses and revenue and the actual spending and collections that accrue over the year — is more than $100 million, according to Budget Committee Chair Joe Giarrusso and the Bureau of Governmental Research. That amount includes a $73 million personnel cost overrun and a $30.5 million reduction in estimated revenue.

The Cantrell administration, while reporting the cost overrun and certifying the reduced revenue estimate, has not provided a number for the budget deficit. It is instead reporting a $65 million fund balance deficit.

The fund balance, which rolls over from year to year, is the amount left in the bank after accounting for revenue and expenses. It goes into deficit when there are remaining expenses after the money is used up to plug budget holes. The administration’s $65 million fund balance deficit factors the use of the available balance to cover the personnel overrun and other unbudgeted spending, according to a slide presentation.

Giarrusso said in an interview on Thursday he’s skeptical of the administration’s $65 million fund balance deficit, in part because it includes more than $30 million in unbudgeted expenses that aren’t detailed.

“If that is the case, we have more than one problem. We have two problems,” Giarrusso said, referring to both a budget deficit and a fund balance deficit. “But if it’s not the case, then I don’t want to go down a whole rabbit hole of saying we’ve got multiple problems until we have more due diligence.”

Council members and administration officials have argued since January about the condition of the city’s finances, and the argument continued at some length at Wednesday’s committee meeting. Council members said they’ve received mixed messages, while Finance Director Romy Schofield-Samuel said her warnings had been written off.

By the end of the meeting, however, council members and administration officials agreed city finances need urgent attention and seemed to reach a truce, albeit a shaky one.

“Moving forward, we’ve got to have better control on overhead, the budgets, hiring, travel, the whole works,” said newly minted Chief Administrative Officer Joe Threat.

Threat said he will soon propose a package of revenue and savings measures, some of which will require council action. Those measures could include overtime restrictions, a more expansive hiring freeze and furloughs, though officials say they want to avoid furloughs if at all possible.

The proposals notably did not include any new fee proposals, which have been publicly contemplated in other recent meetings. They do include new debt: Mayor LaToya Cantrell’s administration is considering bond sales to dig out of the budget hole.

If enacted, the measures would combine for $100 million in savings and revenue, replenishing the fund balance to $35 million, according to the administration.

Changes every day
Councilmember Eugene Green, eyeing the administration’s slide on the fund balance deficit, questioned the accuracy of the reporting — including by The Times-Picayune — on the $100 million budget deficit. He repeatedly asked administration officials for the correct budget deficit number and got different answers.

Deputy Chief Administrative Officer Jonathan Harris sidestepped the question and said he had only read the $100 million figure in the newspaper. He then said the only deficit he is aware of is the $73 million in unbudgeted personnel costs. The deputy finance director, Freda Richardson-Taylor, told Green the fund balance deficit is $63 million, a slight deviation from the administration’s PowerPoint presentation.

Threat repeated the $63 million figure to reporters seeking clarification after the meeting. Harris said that was the first time he’d heard that number.

“That number changes every day,” Harris said.

Deficits, however they’re calculated, are based on projections and difficult to pin down in real time. Threat, who was promoted into his new position this month, said he is frequently asked to approve unbudgeted expenses, which could ultimately affect whatever the city finally has to make up.

“I’ve got hiring forms coming in my office for approval. I’ve got travel coming in to my office for approval. I’ve got contracts coming to my office for approval. That number is moving all the time,” Threat said, speaking to reporters after the meeting.

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