New Orleans Mayor LaToya Cantrell's administration is apparently backing out of a settlement to pay New Orleans Parish Public Schools $20 million as part of a legal settlement.
It all started with a lawsuit filed in 2019, in which the school board accused the city of improperly withholding a portion of sales and property tax revenue due to the school system. In a letter sent to City Counci Budget Committee Chairman Joe Giarusso and obtained by our partners at WWL-TV, the Cantrell Administration cited the city's financial health, cash flow problems, and increasing expenses for backing out of the deal. The letter also noted potential impacts from President Donald Trump's executive order to pause federal spending for local programs--an order that was blocked by a federal judge and later rescinded by Trump.
“The refusal to fund the settlement is illegal," Giarrusso said in a joint statement issued by the council on Saturday. "The Council not only made this deal to help the children of New Orleans, but also expected it to be honored. The Administration’s refusal to help children is indefensible.”
WWL-TV reports that the city's first installment of $10 million was due to the school board by December 31, 2024, with the second installment due on April 1, 2025. The school system, the report says, was counting on the money to plug part of a $36 million budget hole.
According to letter from city attorney Donesha Turner that was obtained by WWL-TV, Cantrell met with school board officials to discuss a settlement, but she never made a decision about making that settlement.
"Our administration–the Mayor and CFO–will work with the administrators of the School Board to secure a settlement that is also financially feasible for the City," Turner wrote.
Council President J. P. Morrell accused Cantrell of putting politics over the city's children.
"Rather than take the win on a settlement structured around increased unbudgeted revenue from Taylor Swift and the Super Bowl, the Mayor instead seeks to starve our schools of revenue in order to keep more cash for the Administration," Morrell said in the statement. "If the City Attorney is concerned about money being misspent, she wouldn’t have taken a junket to DC Mardi Gras with the rest of the Mayor’s senior staff on the City’s dime. We’ve known for a while that the Administration doesn’t have its priorities straight, and this Council will do right for our families and taxpayers. We will do what is necessary to make sure all money is spent correctly and that our authority over the budget exists year-round, not just in December.”
School board officials say they will continue to pursue its lawsuit against the city.
To read WWL-TV's full report, click here.