Fact-Checking Mayor Cantrell's Case For The City's Millage Proposal

Dec 3, 2020

There are three parish-wide millage propositions on the ballot for Orleans Parish residents this weekend. One has to do with maintenance and infrastructure, another has to do with library funding and early childhood education. A third has to do with affordable housing.

New Orleans Public Radio’s Karl Lengel spoke with Mayor LaToya Cantrell, who made the case for voting for all three.

The following is a fact-checked transcript of their conversation. (Fact-checked statements have been italicized.) Proposition 2 has become increasingly controversial and critics have said the Cantrell administration has been pushing misleading information.

Karl Lengel: So let's get right to the heart of what's on everybody's mind these days. We have a vote coming up this Saturday on the millage and property tax. And let's get into Proposal 1. For folks who are just starting to pay attention — what are they voting on this Saturday — what should voters know about Proposal 1?

LaToya Cantrell: Well, first of all, they should know that Proposition 1, 2 and 3 — is a millage renewal package that has been restructured to meet the needs and priorities, up-to-date and 20 years from now. And it will come as a tax reduction starting January of 2021.

Proposition 1 is infrastructure and maintenance. And it will allow the City of New Orleans for the first time to have a dedicated funding source for annual maintenance. In the city, since Katrina, for example, we have spent over 1.5 billion in new infrastructure. But we have never had a lone, dedicated funding stream to even maintain what we have invested in.

So whether that is community centers, all public facilities, N.O.R.D. centers, police stations, fire stations, roads, streets, bridges, you name it. There is no funding source. And therefore we've had to take a scattershot approach in terms of how we maintain things. And what we're proposing with this restructure — that that's no more than we have an annual stream that we can provide annual maintenance every single year. And a roadmap that we can follow from year to year.

Fact-check: The Mayor claims throughout this interview that the millage proposal will reduce taxes. This is not correct. Taxes will remain the same for the coming year regardless of whether the proposal passes. It’s possible the Mayor is referring to other changes in the tax structure that could reduce taxes overall, but it won’t have anything to do with the city’s millage package.

Let’s follow up on that on the roadmap, because some of the major pushback for this has been the term “flexibility.” And in the proposed language is key. It allows the City to continue to spend these funds as infrastructure and technology needs change over the next 20 years. And the Bureau of Government Research (BGR) has objected to the language of “flexibility.” Concern that there's, there's kind of a paucity of detail in what the proposal has happening over the 20-year life. How does the voter approve that flexible proposal concerned with, for example, political changes that can occur over the next two decades?

Right. So, first of all, with the BGR report, pushing back very heavily. Because they were very much supportive of this last year. And it's the same, other than being a tax decrease for our public. That's the reality of this. So, there are plans, um, but if you don't have the resources, plans do not mean anything. But in the restructuring, we have, yes, created some level of flexibility. Because looking at how the millage was restructured previously. And now it is so, um, stringent. If we as a city do not spend what's allocated, for example, for streetlights, we cannot reuse or repurpose those dollars or divert those dollars to streets. So that's the level of flexibility that we're wanting.

In addition to that, historically, the City of New Orleans would take out a loan to buy vehicles or to replace vehicles for police officers, for EMS, for fire. That is not a way to run government, and to be fiscally prudent and sound and efficient in practices. You don't do that with a loan. So, this will allow us, again, that flexibility needed. And we have removed that from even an operating budget and put it on the capital side. Again, being more aligned with fiscal management and being responsible. And that's what we are proposing with the restructure. So BGR, pushing back heavily, they were supportive of this a year ago and a year ago it was actually more of a tax increase. This year it is a tax decrease, but builds in that flexibility, providing annual resources for maintenance in this city. A long time overdue.

Fact-check: The Bureau of Government Research did support the city’s propositions on last year’s November ballot pertaining to infrastructure projects. BGR has not published any reports pertaining to this year’s millage proposal other than the one in opposition.

Are there examples where this has worked? Are there other cities that they just don't do it that way? And they do it the way that you’re proposing?

Yeah. Well, that's the example. Other cities just don't do it that way. Bringing in my CAO, you know, Gilbert Montaño, first coming in and saying, “Wow. We previously would take out a loan to buy vehicles?” Or, “Why aren’t vehicles on the capital side? Why is it in the operating?”

And so we have done our due diligence. And speaking to that is why this city was able to get a credit rating – a year and a half in office and we had our credit rating improved. And not only that. This year, as we have been reviewed by the credit rating agencies, now the City of New Orleans was not downgraded. And we're seeing other cities around the country that are faced with the same fiscal challenges that they are being downgraded. This city has not. Therefore: tax reduction. So I'm asking voters to continue to support the propositions that are on the ballot that will come as a renewal that have been restructured and will also be a tax reduction.

Fact-check: New Orleans did improve its bond rating on Sept. 10, 2019. Moody’s Investor Service bumped the city’s rating from an A2 to an A3 and said the city’s future was stable. At the same time, it said a large amount of capital investment was still needed.

Well, let's get to the second proposal: Proposition 2. And there's lots of controversy here. The [Cantrell] administration states that the reallocation serves early education needs while keeping the library supported. Now, how does it do that?

How we do that is very simple. We have looked at the numbers. Numbers do not lie. Over the past five years, our library system has not spent the budget that has been allocated to it. And what we're proposing with the restructuring is simply allowing their annual expenditures to be aligned with a budget that goes hand-in-hand with that. Freeing up a little money that will be directed towards early childhood education and an investment that this city needs to desperately make in order to ensure that our children, our families. And this economic gap that has only gotten wider since post-Katrina – that we finally turn it around in this city.

We have over 70% of our third graders that cannot read at third-grade level. We have 43% of our children who are living in homes at or below the poverty line. And I've said, “Hey. Nothing stops a bullet like a job.” So we need to invest heavily in our young people in and our families. And we do that through our library system that will remain robust, but we will see some improvements there as well.

But in addition to that, we'll be caring for our children. And currently, we know 7,000 young people that we have identified – low-income children – have no seat to sit in because those families cannot afford it. And much of the pushback on this are from folks that really don't have that choice to make. They can go ahead and put their children in early childhood education as soon as they would like to. But we have too many of our families that do not have that opportunity. And so this is what we're proposing.

Fact-check: A lot to unpack here. First, while the library does have a reserve fund of $14.5 million, it’s picked up its spending in recent years. In 2018 and 2019 it spent just over 97 percent of its budget.

Whether the library can absorb the 40 percent budget cut outlined in Proposition 2 is a separate issue. New Orleans Public Library Director Gabriel Morley says they can do it without reducing services or firing staff. The plan is to look for efficiencies, eliminate vacant positions, and partner with other government agencies to reduce expenses. But none of this is written down. Morley said this week there isn’t a concrete plan.

Library advocates argue that the library will inevitably suffer. Maybe not next year, but over time reserve funding will run out and the new millage rate lasts for 20 years. Library board member Andrea Neighbours argues that the cut will have the largest impact on low-income families who rely on the library for a variety of services including early childhood education.

Cantrell is correct about the literacy situation and the number of families who can’t afford early childhood care and education. More than 7,000 families are eligible for a free childcare seat, but the seats don’t exist.

Proposition 2 does not create new seats overnight. If it passes, the city’s early care program City Seats will have guaranteed funding for the next 20 years and will be able to leverage additional resources from the state. With dedicated funding, the city expects to grow the number of seats over time. I get more into that here.

The proposition itself doesn’t guarantee funding for City Seats, instead it makes it possible for the city to fund early childcare using library tax revenue. The specifics need to be approved by the city council.

The city is relying on Proposition 2 to fund City Seats for the coming year. If it fails, the city won’t be able to fund the program in full and will have to cut the number of available seats in half, unless they secure funding elsewhere.

But some of the pushback and that the library serves underserved communities very well. And to your point, yes, there are people who are benefiting very well in their lives these days and do fine. So by reducing it by 40% is how do you address that? And yes, I understand early education is important, but the library essentially serves as a community center for content access. Crippling that, how do we take care of that over the next two decades?

We take care of both. We take care of both. Because we're going to continue to ensure that the expenditures of the library, again, will remain consistent. So, not taking anything away from what our community receives today. Only going to be improving there and being more efficient in our practices. So, absolutely understanding the role that our library plays in our community. And me being the first on the ground, creating the first community center at a library in the City of New Orleans. So you're talking to someone who has walked the talk, and who will continue to do that. But also understanding that if we don't deal with early childhood education and double down on that investment with our libraries, then we're not gaining anything as a city. So the library serves everyone. Early childhood education – that opportunity right now, it doesn't exist for everyone. So we're looking at a holistic approach to meet the needs of our families – all of our families – in a way that looks at equity. By investing in our people. And much of the social unrest and talks and voices, you know, yelling out about the social injustice and the inequities that exist. This speaks to that very upfront.

So being able to maintain our libraries, while at the same time investing in our future – meaning our young people – puts this city on a path that our residents have deserved for, really, for decades.

Fact-check: Take a look at the last note and read more here.

So when you were putting this together and looking 20 years down the road, there had to be some sort of vision of “after 20 years this what the library looks like.” And I'd like to do a little dreaming right now, because technology does change things. We've got historical references to that. The move from parchment, the idea that we moved to movable type, and it changed how people accessed content. Because that's what a library does. In 20 years, as you sat down and discussed cutting funding to the library, is it that there are fewer buildings? Fewer books and on more platforms? Are there wireless hubs for kids?

No, it’s not fewer anything. It’s not fewer anything. The library has maintained, in terms of its expenditures — and we're looking closely at the data over a five year period – and we're maintaining that level of funding. As well as that level of expenses. So we're not taking anything away from our libraries.

But what we will be doing, and we've looked at the data, as you suggested. We know that even since COVID, 60% of the youth in terms of eBooks have gone up and have increased. We know that when we look at the opportunities to help our workforce pivot to new growth sectors that the use of computers and technology will definitely be a priority. So we're going to not only look at now, but absolutely move our library system into the 21st century and beyond. Because that's what the needs of our city – that's what it's calling for.

Fact-check: Same thing with this one. Take a look at the earlier note, and for a deeper look at the data, check out Michael Issac Stein’s recent reporting.

The state education superintendent [Dr. Cade] Brumley just this week announced that the [State of Louisiana] is going to be looking at accelerating some early education efforts for K-2. Some people have said, “Why don't we just wait a year on this library and early education programming and kind of work some more details out?” Is there any advantage to waiting and seeing what the state might be doing in the way of addressing the problem?

Well the advantage is right now. We cannot wait. We already know the impacts that early childhood education has on children and families. And we also have seen the impact of not educating our public has had on society and in our city. So the thought of telling a parent who has an infant and a child that's ready for early ed to wait? That's the gap. So, what we're doing is encouraging that our kids are not ready for kindergarten. We can't do that. In addition to that, you know, we want to be the first in line to access the state funding for early childhood education. So we don't want to wait for that. We cannot wait. We've waited long enough. And it speaks to, again, the economic divide – the equity gap – that exists in the City of New Orleans and has existed for generations. So, no sir, we cannot wait. But I tell you if people believe that we can, then the resources will only get smaller for libraries if they vote this proposition down. It will not grow.

And not only that. You're talking about a time, in recovery from the pandemic, we can't wait. We can't wait.

Fact-check: We can technically wait. The current millage package is good until the end of 2021. Many groups have argued that the best thing to do is go back to the drawing board and try again.

If Proposition 2 passes, New Orleans would become the first municipality in the state to draw down a “significant match” through Louisiana’s Early Childhood Education Fund, according to Director of the Office of Youth and Families Emily Wolff. At the same time, these funds don’t appear to be going anywhere.

Proposition 3: housing and urban development and affordable housing. How does this one work?

So the economic development and housing millage renewal is focusing very heavily on the 40,000 plus people that we have unemployed right now in the city. It also focuses very heavily on understanding that our main industry for decades and generations has been hospitality and tourism. Knowing and looking at the numbers, it's going to take some time for us to regain our footing in that industry. But the need to groom, prepare, train a workforce for employment right now for jobs in our city right now – we cannot wait. The time is now. So, we're going to ensure, that we prioritize investments, also, in our small businesses. Because they are the backbone. And really do supply jobs for our people.

As it relates to housing – absolutely – the need is there for affordable housing. We still have a community and a city that has a majority of renters. So we definitely need to look at our tenants. But at the same time, move more of our people into homeownership.

Also our small landlord community. We need to ensure that these programs that we've started, even with COVID-19 – that we're able to maintain them throughout our recovery. That also includes our mortgage program.

But one that I'm very much excited about as well is the owner-occupied program. Because this one really speaks to our residents that are currently living in a home – one that they own – that they have yet to be able to maintain adequately. This will help them maintain and improve their homes as they have seen homes be redeveloped around them. It will keep them in the neighborhoods that they've been living in for decades. And also in the community that they've been investing in, and therefore not pushing anyone out. It will also help us leverage the other programs that we have. And structure these development programs to have quality, affordable and accessible housing for all of our citizens in our city that desperately need it.

Fact-check: We’re not fact-checking this section in detail, but the city does offer a deferred forgivable loan program for homeowners to make health and safety repairs. As with the other two propositions, BGR criticized Proposition 3 for lack of clarity:

“There is little doubt that New Orleans faces significant challenges in the areas of housing and economic development. This proposition aims to step up the City’s direct financial investment to address them. The new taxes have the potential to complement other resources with stable, flexible revenue. While established planning and evaluation processes would guide most usage of the housing tax revenue, the lack of a clear spending plan for the economic development tax makes it difficult for voters to assess its potential for effective outcomes.”

And finally, when can I hear Kermit Ruffins live again? Drink a Sazerac without wearing a mask and standing six feet away from my wife? Any kind of projection on that at all?

Well, I mean, I wish I could tell you what that looks like. And what I will say is that the City of New Orleans is one of the only parishes right now that is still being able to even have bars open for that matter. But we have to continue to wear that mask.

We also have been selected to receive a vaccine, being one of the first to do that. So, I've been working very hard on mass distribution pilots, and how we will be able to get that vaccination, again, to our people. It's going to be through the vaccine, I believe, that you're going to realize your beautiful vision of sitting with a Sazerac and listening to Kermit Ruffins while he drinks his Budweiser right along with you.

Fact-check: New Orleans is one of seven parishes where bars remain open. Under Governor Edward’s modified Phase 2, bars in parishes with test positivity 5 percent or higher cannot serve patrons indoors.