The New Orleans Metropolis Council on Monday unanimously adopted a $1.6 billion working finances for 2026, closing a projected $222.4 million deficit and aiming to stabilize metropolis funds after a yr marked by a payroll scare and warnings of potential state intervention.

The spending plan, constructed round suggestions from Mayor-elect Helena Moreno and Price range Chair Joe Giarrusso, pairs roughly $150 million in departmental reductions with $74.5 million in new and beforehand untapped income. The Louisiana Legislative Auditor reviewed the income package deal on the council’s request. Metropolis officers say the estimates are deliberately conservative.

Moreno, who takes workplace Jan. 12 and presently serves as council vp, stated the brand new framework is supposed to finish years of ad-hoc finances fixes and to place a precedence on core providers. “Our finances should mirror what issues most to New Orleanians. We’ll absolutely fund these priorities, particularly public security, and direct sources the place they ship the best impression for our residents,” she stated.

The deficit emerged after an October report from the Legislative Auditor pegged this yr’s shortfall at about $160 million – far greater than earlier estimates – and council members realized the town couldn’t meet payroll via the top of 2025 with out borrowing. Town secured a $125 million short-term mortgage from the state that should be repaid by mid-2026, placing added strain on subsequent yr’s finances.

To assist fill the hole, Moreno’s transition group and council employees recognized a number of new income streams and accounting corrections. The package deal consists of about $15 million in unspent federal pandemic help, $29.5 million in reimbursements from the Sewerage & Water Board, roughly $14.5 million tied to stepped-up parking enforcement and $16 million from the Wisner Belief, together with smaller changes elsewhere within the finances.

On the spending aspect, the plan trims mayoral staffing and different executive-branch prices, consolidates some capabilities and depends on once-per-pay-period furloughs for a slice of workforce officers labeled as non-essential – about 14% of metropolis workers, or roughly 700 employees. Metropolis leaders say the measures are designed to be non permanent whereas longer-term efficiencies and income choices are developed.

On the identical time, the council emphasised that a number of departments might be “absolutely funded” at or close to current-year ranges.

The 2026 amended finances allots $162 million to the New Orleans Police Division, up from about $149.4 million in 2025, and $132.5 million for the hearth division, roughly matching this yr’s adopted determine. Emergency Medical Companies is ready at $18.75 million, barely above the present yr, whereas the Juvenile Justice Intervention Heart will obtain about $7.8 million.

The plan additionally maintains assist for the town’s 911 system and primary infrastructure.

The Orleans Parish Communication District is budgeted at $17.6 million, the Division of Public Works at $19.9 million and the Sanitation Division at $70.4 million – an quantity that retains trash assortment and associated providers complete after earlier proposals to chop them.

Security and Permits will obtain about $6.5 million, whereas the New Orleans Recreation Improvement Fee is funded at $19.4 million and the Council on Getting older grant at $1.2 million.

Though the general-fund line for Code Enforcement exhibits zero {dollars} within the amended finances, council paperwork word the company’s complete 2026 spending authority is $10.5 million, financed primarily via self-generated income equivalent to fines and costs quite than the overall fund.

In anticipation of ongoing staffing shortages, the council put aside $38.9 million for public-safety additional time pay within the Chief Administrative Workplace finances: $23.5 million for police, $5.9 million for hearth, $3.5 million for EMS, $1 million for the communications district and $5 million for different companies.

The finances vote capped weeks of friction between the council and outgoing Mayor LaToya Cantrell over shut the hole.

Cantrell has stated her workplace was largely excluded from the ultimate phases of the method and that her income concepts have been ignored. Council leaders counter that they repeatedly invited the administration to have interaction on the brand new income findings and to log out via the town’s Income Estimating Convention, which recommends the official revenue forecast that should undergird the finances.

Council President JP Morrell stated the council stepped in after Cantrell declined to approve the brand new projections at a Income Estimating Convention assembly on Monday.

“I’m extraordinarily grateful for the work of Price range Chair Joe Giarrusso, Mayor-elect Helena Moreno, and the members of the Cantrell administration who put collectively a finances that avoids future furloughs, in addition to avoids the 30% cuts throughout the board that the Mayor proposed,” Morrell stated, including that he expects future budgets to be “clear and forward-facing.”

Giarrusso referred to as the ultimate doc “a product of steady, tough, and ongoing work” amongst council members, Moreno’s transition and the administration, and stated extra modifications are possible as the town continues to handle its structural deficit.

Incoming Price range Chair Lesli Harris stated she is “optimistic about our metropolis’s future, whereas absolutely acknowledging the tough work forward as we navigate a big monetary disaster.”

Moreno plans to convene one other Income Estimating Convention on Jan. 12 to replace the town’s forecast and start what she has described as extra frequent, hands-on administration of the town’s funds.