New Orleans Mayor LaToya Cantrell got angry at reports about the embattled Sewerage & Water Board’s finances. The agency admitted that it has $134 million in unpaid water bills over the past 3 years under questioning by the New Orleans City Council. That is 20% of the total money billed by the agency.
In order to stabilize the S&WB’s finances, Cantrell has been trying to put together a bailout from the state. The deal she is trying to structure would see a one-time infusion of money and recurring revenue of tens of millions a year from the hospitality industry.
From here, we’ll take it to The Advocate for the rest:
Those fragile negotiations could be imperiled if state officials do not believe the S&WB is doing all that it can to properly manage its own finances. That concern was explicitly voiced by an angry Cantrell, who called The Advocate late Tuesday afternoon to complain that reporting on the figures “could kill the deal.”
“What do you want to do, screw the city?” Cantrell asked in a phone call hours after the newspaper posted an online story about the questions over unpaid bills. “Is that what you want?”
“Who’s doing the work trying to get the money we need? Me,” she said. “It’s for the city. And it’s just that serious. You can play games if you want, but this is not the one. It’s not it.”
The estimate of how much money may be owed to the S&WB was compiled by Councilman Joe Giarrusso and his staff, working from past agency reports. It amounts to about half of what the utility has budgeted to run all its systems for the coming year.
The citizens of New Orleans and of the state of Louisiana have the right to know how bad the financial situation is for the S&WB. Cantrell’s hissy fit at The Advocate for covering the story should worry everyone.
As for the bailout she’s seeking, here’s what it looks like so far:
The deal she is seeking would include a one-time cash infusion of $75 million and up to $40 million a year in money from entities like the Ernest N. Morial Convention Center, which would be combined with other funds raised by the S&WB.
“We know we’re owed money. I’ve been talking about that ad nauseam,” Cantrell said. “Even if we had the $140 million in hand, man, the problem is not solved. We’re talking drainage, man. We’re talking no reserves, man. We’re talking no cash flow, man.”
A working group including representatives of Cantrell and Gov. John Bel Edwards is currently hashing out the details of the initial lump sum payment, and about a dozen of its members have told The Advocate the group is expected to deliver about $50 million.
If Cantrell is opposed to even press coverage of the S&WB’s own financial estimates, there is no good reason for the Louisiana legislature to throw money at the agency. But if there’s going to be a bailout, the state should insist on an audit to make sure the money is spent wisely.