The New Orleans City Council grilled the city’s chief administration officer over concerns that city workers may not be paid through the end of the year amid the city’s financial crisis.
According to CAO Joe Threat, the city’s cash-flow issues have reached a more severe level than originally anticipated.
Threat said the city applied for an extension for funds through a FEMA program back in August, but that money has not shown up.
Threat said he didn’t alert the council because he felt they were moving in the right direction.
This unaccounted money, plus the NOPD overtime spending not being caught earlier compounded to the city’s financial crisis.
According to New Orleans Council President JP Morrell, overtime was not curbed all year, despite some departments asking if they needed to scale back.
The city only budgeted $45,000 for the year for all departments for overtime. This year, the city spent $45 million in overtime.
Morrell said that the city cannot do a line of credit to pay workers, but instead will have to go to the bond commission.
The city will have to present a detailed report on what they plan to cut in order to get the bonds issued.
The meeting ended without a firm solution for resolving payroll.
This comes after the state auditor revealed the city’s deficit is closer to $160 million, which is worse than the originally projected $100 million.
The legislative auditor also reported that the city has $46 million in its rainy day fund, but says $37 million is restricted and cannot be appropriated.
To see the report from the legislative auditor, click here.
According to Councilman Joe Giarrusso, this has the city running tight with just $8 million in surplus.
The city must set a 2026 budget by Dec. 1.
READ MORE:Emergency meeting on city payroll problem ends without firm solution to pay workers
