The New Orleans money pit

NY Times:

Somehow, some way, at some point in the future, city officials here will need to pay back all the money they are borrowing. In the meantime, though, the Mardi Gras parades must still be protected, the police must still patrol the streets and the garbage must be picked up.

And so, even though the city has already racked up $120 million in debt, officials here are scrambling for loans of as much as $200 million more so that New Orleans can continue to pay its bills through the end of the year.

"We can't keep borrowing money," said Oliver M. Thomas Jr., the president of the New Orleans City Council. "But the need for fire protection doesn't just go away. At some point, we need to rebuild our parks and restart recreation programs as children and families start coming back."

Youth programs, however, are the least of the city's problems right now. With its credit rating downgraded to junk-bond status, it is not clear how the city will even find the money to maintain its most critical services, like police and fire protection. Though the city has already laid off nearly half its work force, New Orleans still needs $150 million to $200 million in 2006 to fill the huge hole that Hurricane Katrina blew in its budget, said Reginald Zeno, the city's finance director.

The lost revenues include tens of millions of dollars in property taxes that will go uncollected in a city in which more than 80,000 homes, according to state estimates, were severely damaged or destroyed. With more than half of New Orleans's populace still living elsewhere, sales tax collections are less than half of last year's levels.

"We put together a bare-bones budget last fall, but we still don't have the resources to fund it," Mr. Zeno said.

...


Comments

Post a Comment

Popular posts from this blog

Should Republicans go ahead and add Supreme Court Justices to head off Democrats

Washington Post: Some Democrats eye adding more justices to the Supreme Court to change its ideological bent The once-remote idea has gained the attention of liberals angered by the GOP push to remake the federal courts. Probably the easy way to defeat this court-packing scheme is for Trump to propose doing the same thing now.  It would lead to Democrat denunciations and claims that it would be wrong, thereby blowing up any attempt by them in the unfortunate event of Democrats winning a presidential election.
Read more

29 % of companies say they are unlikely to keep insurance after Obamacare

Conn Carroll: A new survey of 368 midsize to large companies found that 29% of them are considering terminating their active employee health care plans when Obamacare is full implemented in 2014. Only 71% of employers surveyed said they did not expect to drop their health coverage, while 20% said they did not know and 9% said they were planning to exit. The latest survey, conducted by Towers Watson, echoes an ealier survey by McKinsey & Co. finding that 30% of private-sector employers were planning to drop their employee health insurance coverage by 2014. When the Congressional Budget Office crunched Obamacare's spending numbers, they estimated that only 7% of employees currently covered by employer-sponsored plans would lose their plans. ... This means the cost of the health care fiasco will be hundreds of billions more than estimated by the CBO and Congressional Democrat. It is also clear that Obama's pledge that you could keep your health care plan if you wanted t
Read more