(The Center Square) — Louisiana Treasurer John Fleming said Wednesday the state has a tentative plan to move forward on New Orleans’ request to borrow $125 million without taking over the city’s finances.

Talks between the two governments restarted a week after the city pulled its request to sell $125 million in state-issued bonds to pay its bills, a plan criticized by Gov. Jeff Landry, who said the city should agree to a fiscal administrator in return for the loan.

“We have a framework,” Fleming told The Center Square, describing talks as cooperative rather than adversarial. “We don’t really want to do fiscal administration, and they don’t want us to do fiscal administration… but we can’t just give them money with no strings attached, either.”

Under the outline Fleming described, there would be no fiscal administrator. Instead, Legislative Auditor Mike Waguespack and his office would work with the city’s administration while all bond proceeds are held in a separate account. Money could be drawn only with the state legislative auditor’s permission, Fleming said. If controls fail or the city cannot stabilize its finances, the auditor could halt disbursements and refer the matter back to the Fiscal Review Committee, which could then pursue fiscal administration.

“The legislative auditor will be step by step with them, and have some control of the money,” Fleming said, adding that policy decisions would remain with the mayor and City Council. “He can always stop the funding… and then we go straight to fiscal administration.”

City Council leaders who met with state officials on Wednesday could not immediately be reached for comment.

Fleming said the $125 million figure remains the city’s request to cover year-end payroll and other cash-flow needs. He emphasized, however, that borrowing alone won’t solve the gap.

“They’re going to have to cut programs and furlough people… They’ve got to have a loan, but they’re going to also have to cut spending and find ways to enhance their revenue,” Fleming said.

He cautioned the plan is not yet final. A closed working session of the Fiscal Review Committee is tentatively set for Nov. 12 to lock down details, followed by an open State Bond Commission meeting, where the framework and any borrowing would be presented for approval.

“As of right now, nothing is signed,” Fleming said. “It’s a framework… we all agree that this is the best route to go,” subject to legal and constitutional checks.

The revived talks followed a tumultuous week in which Landry urged lawmakers to deny the city’s initial borrowing plan and pressed the Fiscal Review Committee to consider appointing a fiscal administrator, citing years of overspending. Attorney General Liz Murrill echoed those concerns.

In response, the City Council adopted what it described as guardrails to confine any borrowed dollars to payroll, segregate proceeds, require detailed spending plans and open the books to state scrutiny. Mayor-elect Helena Moreno has said she supports oversight but opposes a state takeover.