Government & Politics

Landrieu seeking property tax increase; money could be used for consent decrees

A New Orleans property tax increase sought by Mayor Mitch Landrieu is quietly making its way through the Legislature, which is the first step in a series of necessary approvals.

The approximately 1.5 mill increase would raise $5.6 million for fire and police protection starting in 2014.  That would increase to $5.9 million the next year, according to the fiscal note attached to House Bill 290.

The money could help city officials pay for two federal consent decrees, one regarding the New Orleans Police Department and the other affecting the Orleans Parish Sheriff’s Office. It also could shore up the sagging firefighters pension fund.

The increase would cost the owner of a $200,000 home $30.80 a year. A majority of voters statewide, as well as a majority in Orleans Parish and the City Council, eventually would have to approve the matter before it could take affect.

State Rep. Walt Leger, D-New Orleans, is sponsoring HB 290 at Landrieu’s request.

“We have a number of public safety issues in the city,” Leger said. “We have two consent decree issues – for OPP and NOPD. There might be a need to hire more police. We have a pension problem with firefighters. The constitutional amendment is necessary to empower the City Council in case it wants to raise millages for the purpose of police and fire protection.”

The measure is still in a House committee and has several more steps before it would be approved by the Legislature.

Local and federal officials estimate the police consent decree, which was approved in January, will cost the city $55 million over five years. The Sheriff’s Office consent decree has not yet been approved, and funding won’t be determined until a July hearing in U.S. District Court, but estimates from the administration and Sheriff Marlin Gusman have added costs going into the tens of millions per year. Landrieu has said the combined costs of the two decrees would force massive employee layoffs and furloughs.

If approved by the Legislature, the tax increase would go before voters statewide in November 2014. That’s because the city’s maximum millage rate is set by the state Constitution. As with all such amendments that deal with local issues, the matter wouldn’t pass unless a majority of voters statewide and in New Orleans approve.

The current millages in Orleans Parish are 5.26 for police and 5.21 for fire, according to the city’s budget. Leger’s proposed constitutional amendment would let the City Council raise each one to 6 mills, or .74 mills more for police and .79 more for fire. Property owners don’t receive the benefit of the homestead exemption on the millages, so they are levied against a property’s full assessed value.

Landrieu spokesman Ryan Berni disputed that the mayor wants to increase taxes. Rather, the mayor simply wants to give the City Council the ability to do so if it chooses, Berni said.

Indeed, New Orleans City Council member Stacy Head said she supports HB 290 because she believes in giving the council the flexibility to increase millage rates for a dedicated purpose. But Head said she opposes this specific increase because the city has imposed too many other tax or fee increases since Landrieu took office.

City tax rates have gone up by about 9 mills since the 2010 fiscal year, former Mayor Ray Nagin’s last year in office. That’s about $130 for a $200,000 property with a homestead exemption. The monthly Sewerage & Water Board sanitation fee has doubled to $24 since 2010. And last year, the council passed a Landrieu-backed plan that will more than double water bills by 2020.

“This is a logical move to get a dedicated tax stream for a purpose we need desperately,” Head said. “But there have been so many other increases under this council and this mayor. I don’t know that the people can handle one more.”

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  • ferngrrl

    Wait. Mitch wants the City to cough up a few million to create a tourist-lure at the foot of Canal Street, but can’t find any other way to pay for streetlight repairs, police, and fire services? Come on. Sure, tourism is our income. But, honestly, 9 million people last year, more this year–slow down and balance marketing us with taking care of the infrastructure of the current residents. If the city doesn’t make enough $$ from tourism, then fix *that.* Collect the back taxes that are owed. Doubled SWB bills, in spite of what Zurik has exposed, doubled trash fees, in spite of trash bins in the street blocking cars and parking. Need to balance attention between “tourism” and residents.

  • The next set of mayoral candidates should let the voters know how much the city revenues goes to fund the pension of city employees. It’s something like 40% that is untouchable.

    If it’s 40% of all tax revenues just to fund pensions, that’s UNSUSTAINABLE.

    And you know the Civil Service Commission and Pension Funds have almost never ever negotiated unless the city actually declares bankruptcy. And the blame game continues, it’s the leaders. And then new elected leaders say it was the past policy and pension funds, etc.

    Basically, the City has to play hardball and that means bankruptcy. And with all the things from Hurricane Katrina, Flood Insurance, highest car insurance, SW&B rates increase, virtually no Fortune 500 companies, No Avondale, and no Chevron, THE VOTERS need to see the value in the short term pain of BANKRUPTCY before they can see money for streets, lights, proper staffing at police, and the list goes on and on.

    The next mayoral candidates need to discuss where the money is really going and how other CITIES had to deal with CITY EMPLOYEE PENSION FUNDS and Civil Service Commissions.

    Heck, the Bureau of Government Research (BGR) should shine the light on how much money (in % tax revenue) goes to the pension funds and how other cities, “that declared bankruptcy” fared, as opposed to current cities as those cities also gave too much to city employee pension funds…e.g. California cities…..

  • Ryan Berni

    Since The Lens will not use the statements that were given to them prior to the story posting and continue to mischaracterize the issue, here were our comments.

    This is not a property tax increase proposal. Mayor Landrieu is committed to reforming the firefighters pension fund and the criminal justice system to rein in rising costs to the taxpayers. The bill was filed as an emergency measure should the Courts render judgments that would put the City in financial peril. This bill would give the City one option for generating additional funding for the fire and police in that instance. It would start a process to allow the City to seek one in the future.

  • ferngrrl

    Here’s an idea: Someone somewhere should explain to us, the general public, precisely how the City’s budget works, what come from where, what goes where and why. A series of articles with diagrams, maybe. Even if that turns out to be a book, it would go far in communicating to the public what the hell is going on. And if we all knew, then maybe we could share creative ideas and *participate* more effectively. Or is it too complicated for us well-educated folks to understand? I’ve tried, but can’t seem to get all the information and connections.

  • honeyabeille

    “This is not a property tax increase proposal.”

    Are you channeling Magritte, Mr. Berni? This is an increase in taxes, ergo, it is a *tax increase.* You and the spinmeisters over there at City Hall can do Chinese acrobatics on this one, and you will try, no doubt, but in the end, it will still be a tax increase.

  • city1watch

    Whats wrong Mr Berni? The Lens did not repeat your press release word for word? God forbid they have an opinion.

  • You need to make a correction. The city has two millages for police and fire. The first is the 5 or so mills you’ve listed and it’s that millage that is reduced for many through the homestead exemption.

    If you look on the assessor’s FAQ though, you’ll see another 10+ mills for the same thing except that this millage is exempted from the homestead exemption. This effectively makes it an even higher amount as it applies to the full assessed home value rather than just that amount greater than $75,000.

  • Stacy Head sure seems to have an easy time constantly deciding the people of New Orleans should fork over more their own money!

    She’s thus far felt it wise to increase our property taxes several times.

    She’s decided a great way to take care of her constituents is to more than DOUBLE our already inflated SWB bills.

    And, just so she know we know how much she cares about our pocketbooks, she voted to more than double her own salary to a whopping $85,000 per year!


    So the person who is taking out water bills from $150 dollar per month to $300 per month (even though the equivalent Jeff parish bill is around $50/mo) and who has pushed our property taxes up by more than a third in the past few years, also thinks we should fork over more cash so that she and her cohorts can make over 4 TIMES as much as the average New Orleanian??

    God I sure hope her husband is the one who does the budget at home!

  • Charles Maldonado

    The 10.47 millage is the one this article is about. The assessor’s FAQ just combines the two millages (5.26+5.21=10.47). And as the article says “Property owners don’t receive the benefit of the homestead exemption on
    the millages, so they are levied against a property’s full assessed

  • Actually check this graphic from the Assessor:

    It lists 6.40 mills for NOPD/NOFD as well as 2.90 mills for OPSB / OPP, with this cumulative 10.30 mills affected by homestead exemption. It then lists ANOTHER 10.47 mills for NOPD/NOFD that is not affected y homestead exemption.

    Total of nearly 21 mills which makes it the highest such tax rates in the state and yet they still can’t deliver basic services or balance their budgets…

  • Charles Maldonado

    Got it. I know the graphic well. This article just happens to be about the non-homestead police and fire rates, currently a cumulative 10.47 mills, because those rates are addressed in the constitutional amendment.

  • Ah gotcha!

    Still, it would be nice if the various discussions about things like this reflected the cumulative numbers. That’s what’s sad, the fact that nothing is still getting done even with such high numbers.

  • nickelndime

    I predict more consent decrees and quadrupled SWB bills and fees. What will happen then? Rearrange our cardboard boxes underneath the I-10. Maybe Mitch and his entourage, including all the Duputy Mayors (you know – the ones who did NOT resign yet, but should have – a/k/a Ann D. Duplessis) will throw a couple of dubloons at us! BTW, ever try to get help from the SWB when there is a billing problem? My water (and services – ha!) bill quadrupled from one cycle to the next. No one ever came out to re-read. In desperation, I paid the bill (after the plumber $$$) assured me that there were no leaks. You want to know how the SWB corrected the misreading? By applying my overpayment to each monthly balance (voila!). Now I ask you (the mayor, his entourage, and the City Council, etc.), is this any way to run a CITY?!!!

  • honeyabeille

    Andrew Ward you show your ignorance. Stacy was one of two votes AGAINST the doubling of the SWB rates. The other was Ernest Charbonnet. And council salaries are now 80k not 85k. Get yer facts straight.

  • The only reform required in the property tax rolls is to revoke the non-profit status thousands of properties. The universities tax breaks hurt, but are justifiable as they bring so much to the economy. The tax breaks taken by church administered properties are exploiting the taxpayers of this city and contribute NOTHING.

  • nickelndime

    The City Council is being grossly overpaid at $80,000 per year per HEAD. LOL!