New Orleans Mayor talks economic damage caused by pandemic

Chris Miller
March 17, 2020 - 7:19 pm

The coronavirus pandemic's economic impact is disrupting businesses, and that also disrupts revenue collected by local governments.

"I know a lot of our people at this time are really worried, and I understand that they have a right to worry about how they're going to make ends meet," said New Orleans Mayor LaToya Cantrell. "And I hear you, and I've been fighting for you, and we'll continue to do just that."

The mayor said making matters worse, about half of the city's revenue comes from sales tax collections -- revenue that's crashing as people stay home and spend less, other than groceries and other basic necessities. She said it will present a challenge for the city to keep services available to the people who need them most.

"Much more severity is coming with layoffs that we have seen happening throughout the city of New Orleans," said the mayor.

The mayor encouraged people who qualify for unemployment benefits to seek them. She also offered support to the business community, and encouraged them to help their employees.

The city is waiving penalties and fees that businesses are subject to if they are late with sales tax payments, despite the hit that will cause the city's operating budget. 

Cantrell said the city is also extending the deadline for renewal of alcoholic beverage permits to try and protect businesses bottom lines.

The mayor said it's her hope that businesses will use this leeway to continue paying their employees.

However, she also said businesses that continue to operate, like grocery stores, need to get their sales taxes in on time.

City Hall released this statement this evening:

NEW ORLEANS – Mayor LaToya Cantrell today announced that, response to the COVID-19 outbreak, the City of New Orleans is waiving fines, fees, interest and penalties on sales tax payments due to the City for 60 days. In addition, the City will extend the renewal period for ABOs up to 30 days without penalty.


"The impacts of COVID-19 are going to leave a mark in history for the city. How we respond to this pandemic will define us. My number one concern has always been – and will always be – to protect and serve the people of our great city. I know that a lot of our people are really worried right now about how they are going to make ends meet. I hear you, and I am fighting for you," said Mayor Cantrell. "My goal: That we all get through this uncertain time. Everyone needs help getting through this. We are all going to have to help each other out as much as we possibly can. I have relaxed what is owed to the City – and businesses must use this opportunity to do everything in their power to help the residents of New Orleans – this includes paying employees.


"I want to be clear – businesses that are continuing to operate, such as grocery stores, should continue to remit taxes on time," added Mayor Cantrell.


Mayor Cantrell also emphasized the need for help from the federal government, particularly in the form of relief from the Small Business Administration and is coordinating efforts with the area’s congressional delegation to get direct assistance.

 

The actions come after six months of major logistical and financial challenges for the Administration, from the tragedy of and ongoing response to the Hard Rock collapse to the ongoing recovering from December’s cyber security attack. These events have a significant impact on the City’s financial future, Mayor Cantrell noted, and the City is going to feel the economic impacts for a long time to come.

 

Especially considering the timing of the decision, the City will forego major revenue; the months of February (which included Mardi Gras), March and April represent about 35 percent of the City’s total annual revenue. The City will be forced to adjust its budget, spending, and operations accordingly, while continuing to provide critical services to the community and continuity of government operations.

 

"I must make decisions today on what government will look like when this is over. I am committed to making difficult decisions that will allow residents, businesses that are continuing, the economy, and the City to recover when the time comes," said Mayor Cantrell.

 

Chief Administrative Officer Gilbert Montaño affirmed that the City has initiated significant changes to the way City Hall and other service providers operate to ensure the safety of residents, visitors, and employees while continuing to provide essential governmental services. However, he said, a little over 50 percent of the City’s total revenue comes from sales taxes and other sources that rely heavily on tourism, such as hotel/motel taxes.


"As we look at some of the manual projections and specific modeling we are doing, we have realized that the City will undoubtedly run out of cash at a certain point," said CAO Montaño. "Hotel/occupancy taxes are trending right now at 8 percent to 12 percent. We don’t feel it yet. But we will."

 

CAO Montaño estimated cuts in spending in upwards of 25 to 30 percent. This could lead to workforce reduction, limiting services, and closing NORD facilities and libraries.


REMINDER TO BUSINESSES

Businesses not included in those closed yesterday are encouraged to review their operations to ensure proper social distancing, regular disinfecting of workspaces and equipment, and no gatherings larger than a “household size.” If a business is not able to adjust to this guidance, it should not operate. Also, please call 311 to report gatherings and check back regularly at NOLA Ready.


Below is an update of other City departments.

 

PARKS AND PARKWAYS

In response to the COVID-19 outbreak, the Department of Parks and Parkways is taking steps to reduce the number of in-person visitors to their buildings. 


All requests for tree and neutral ground grass service should be routed through the 311 system.  


All applications for employment are being accepted by email only (parksandparkways@nola.gov). Download application. 


The Department is asking all applicants for all other services to submit their permit applications, materials, and general questions to the Department via e-mail. The Department will continue to accept in-person permit applications and payments that are left at their main gate.  


Those with general special event questions can contact eventpermits@nola.gov.

The following provides general information and instructions for applicants:  

    All applicants should make every effort to submit their application materials via email 
    Representatives from Parks and Parkways are available via phone or e-mail to answer general questions
        Phone: 504-658-3201
        Parks and Parkways E-mail: parksandparkways@nola.gov 

SUMMER YOUTH EMPLOYMENT

In order to slow the spread and flatten the curve of COVID-19, the Mayor’s Summer Youth Employment Program will temporarily suspend the process of scheduling interviews to register for the program. We are currently creating a contingency plan to re-engage our Summer Employment participants which will be made available to the public in the very near future. Please visit the NOLA Youth Works website periodically to find out when the process will resume and thank you for your patience.

 

COURTS

Due to the ongoing COVID-19 Coronavirus Health Emergency, Orleans Parish Civil District Court and First and Second City Court are closed except for emergency matters and are currently not scheduled to reopen until Monday, April 13. Jury and judge trials, status conferences, hearing dates, or any other court appearance scheduled on a date after April 13 will go forward unless this emergency order issued on March 17 is extended.

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