NEW ORLEANS, Wednesday, October 29, 2025 | Today, the New Orleans City Council held a special meeting to introduce legislation to place guardrails on the proposed $125 million of revenue bonds that will be used to pay for City employees and to ensure the budget passed by the Council is followed. In addition, the Council will grant the Louisiana Legislative Auditor access to review the City’s finances from 2022 and beyond, and to review the City’s financial position regularly. Understating the urgency and gravity of the City’s finances, the City Council is proactively legislating solutions to show fiscal transparency and accountability.

The Council also approved Resolution R-25-560, requesting that the Louisiana Legislative Auditor, the State Inspector General, and the New Orleans Office of Inspector General conduct detailed investigations into the City's fiscal practices and its current financial condition. 

Ordinance 35,297 establishes a special dedicated fund for the revenue bonds and requires strict processes for any draw-down of funding, and restrictions to the use of said funds. The ordinance requires any revenue bond funds to be used exclusively to meet the city’s 2025 budget year payroll obligation to pay active employees’ current salaries and wages, including approved overtime earnings and current fringe benefits.

The ordinance also places restrictions on the funds, including:  

• (a) Moneys deposited into the Fund shall remain therein until transferred for the purposes specified in this division. No moneys deposited into the Fund may be transferred into the general fund or into any other fund, except as expressly authorized in this division.
• (b) No expenditure from the Fund may occur unless expressly authorized by Council resolution.
• (c) Before the adoption of a resolution authorizing the release of moneys from the Fund for payroll obligations, the chief administrative officer, together with the director of the department of finance, shall submit a detailed budget and expenditure plan to the clerk of council covering the applicable payment period and detailing the proposed payments from the Fund.

The reporting requirements specified within the ordinance are as such: 

• (a) The director of department of finance shall keep detailed and accurate records of all moneys within the Fund and all expenditures therefrom and shall transmit on the second Monday of each month a written report to the chief administrative officer and the clerk of council. The monthly report shall provide a complete, detailed accounting of all moneys in the Fund including all revenues and expenditures therefrom.
• (b) The chief administrative officer shall provide the state legislative auditor with view-only access to the city’s enterprise management software and provide any specific reports requested by the auditor including, but not limited to, income statements, balance sheets, trial balances, accounts payable aging report, and accounts receivable aging report.
• (c) The chief administrative officer, together with the director of the department of finance, shall prepare and transmit the following reports to the state legislative auditor and the clerk of council: 

  • a - Monthly budget-to-actual expenditure reports (post-reconciliation) that include department-level detail and written explanations of any variances exceeding five percent;

  • b - Weekly year-to-date payroll reports by pay period of all gross pay components, including, but not limited to, regular time, overtime, and supplemental pay for each city department; 

  • c - Overtime reports that provide the total amount of overtime payments made year-to-date, by department and pay period, and shall include all related documentation, including, but not limited to, written supervisory approvals and detailed department justification for the approved overtime;

  • d - Monthly 90-day overtime spending projections that detail all anticipated overtime spending for the next 90 days;

  • e - Biweekly expenditure reduction reports that specifically list the city’s expenditure reduction initiatives, the total cost savings anticipated for each initiative, the progress on each initiative in the prior two weeks and year-to-date, and the cost savings achieved on each initiative in the prior two weeks and year-to-date. In the event an initiative fails to meet its anticipated cost savings, the report shall include a written explanation of the likely cause of the failed outcomes and the additional adjustments planned to account for the unattained expenditure reductions;

  • f - Monthly cash flow projections, including updated projections that reflect anticipated inflows, outflows, and projected ending balances for all city funds;

  • g - Monthly reports of all city bank account balances after reconciliation. 

Resolution R-25-561 echoes the ordinance’s restrictions and reporting requirements, while reiterating the City Council’s commitment to transparency and accountability to the public. 

Resolution R-25-560 requests the Louisiana Legislative Auditor, the State Inspector General, and the New Orleans Office of Inspector General conduct detailed investigations into the fiscal practices of the City and its current financial state. The request urges the Auditor, Inspector General, and New Orleans OIG to investigate the management and use of the City’s finances including but not limited to budget and accounting practices, hiring practices, employee augmentation, overtime, contracts, and federal funding for Fiscal Years 2022 through 2025. The purpose of this requested investigation is to reliably determine the actual financial health of the City and to make recommendations that help the City chart a path forward to resolve the budget crisis.

The resolution further requests that all aforementioned agencies investigate all City expenditures as appropriate within their agency’s purview, including but not limited to the use of overtime, federal funds, and contracts for Fiscal Years 2022 through 2025. 

“The Council is legislating to ensure money from the proposed revenue bonds will be spent to meet necessary City payroll expenses,” said District A Councilmember and Budget Chair Joe Giarrusso. “The legislative instruments provide the Council and the Legislative Auditor with more financial reports so everyone can regularly see what is happening. The Council understands what is at stake and is moving with urgency to help solve the current problem and to safeguard how these funds are spent." 

“Under a looming budget crisis that threatens daily operations, the City of New Orleans can no longer afford to fiscally operate in the dark,” said City Council President JP Morrell. “Inviting the Louisiana Legislative Auditor to review the City's finances from 2022 onward is critical to demonstrate to the State that the City of New Orleans is 100% committed to budgeting with full transparency and accountability moving forward. In addition to the LLA's investigation, the City Council is creating guardrails on the proposed $125M of revenue bonds so that every dollar can be publicly accounted for. As City Council President, I will work extensively with both the Bond Commission and the Legislative Auditor so that we can move past this deficit.” 

“The Council remains firmly committed to fiscal responsibility and transparency in every aspect of city operations. We recognize the vital importance of ensuring that all City of New Orleans employees are paid accurately and timely for their hard work and dedication to our community,” said City Council Vice President Helena Moreno. “We are taking proactive steps to identify and resolve any outstanding payroll issues swiftly, while ensuring proper oversight and tight guardrails over use of funds and accounting.” 

“As a city, we must demonstrate our commitment to responsible fiscal management and cost reduction,” said District B Councilmember Lesli Harris. “This loan is essential to ensuring we meet payroll obligations and fulfill our commitments to vendors so we can continue delivering core city services.” 

“I support efforts to strengthen accountability and transparency in how public funds are managed,” said District C Councilmember Freddie King III. “The City Council's intent is to ensure the protection of our employees, along with the rest of our citizenry." 

“The Council is establishing clear reporting requirements and oversight from the Legislative Auditor to take proactive steps to restore confidence in the City’s financial management,” said District D Councilmember Eugene Green. “We have a responsibility to ensure every dollar borrowed and spent by the City is done transparently and with accountability. These guardrails reflect our commitment to fiscal integrity and sound stewardship of public resources.” 

“Thank you to our Budget Chairman, Councilman Giarrusso, for his efforts on this endeavor,” said District E Councilmember Oliver Thomas, Jr. “This legislation is about restoring trust and enforcing accountability.  By putting these guardrails in place, we’re ensuring that every expenditure from this $125 million bond is tracked, reported, and used judiciously. Public trust and transparency aren’t optional in government financing, and this legislation makes that clear.”