Like a bad tenant who seems intent on trashing the apartment before his lease runs out, Mayor Ray Nagin has been busily approving contracts that extend well past the May 3 end of his term — leaving the next administration and City Council saddled with obligations the city will not be able to meet. Here's just a glimpse of Hizzoner's late-term spending spree:
• He extended two of the city's three sanitation contracts to 2016. The contractors agreed to reduce their prices by 10 percent, but the extensions still would add tens of millions of dollars to the contracts' total costs.
• He plans to jump-start his proposed $80 million redevelopment of the Municipal Auditorium by giving some of his pals a no-bid "professional services contract" to oversee the project.
• He solicited proposals to supply computer equipment and software for various city departments at an estimated cost of $1 million a year for two years — but there's no guarantee the costs won't be higher.
• He is spending down the city's "revolver" fund on projects and contract extensions that one former official says probably won't qualify for federal reimbursement, which means the city will be on the hook for those expenses — and other, more worthy, recovery projects won't get funded. City capital projects director Bill Chrisman recently resigned over the mayor's decision to proceed with the questionable expenditures, saying he could not in good conscience remain part of an administration that spends recovery funds so cavalierly.
With less than 50 days remaining in his administration, Nagin continues to spend money the city does not have despite pleas from Mayor-elect Mitch Landrieu to exercise some fiscal restraint. Nagin has ignored Landrieu's requests, even though the mayor asked the same of his predecessor when he entered office in 2002. Nagin should recall that at least one of his predecessor's pals went to jail in connection with a last-minute deal.
We won't speculate as to Nagin's motives. Suffice it to say that a big part of the problem is bad timing: Mayors and council members begin and end their terms in the middle of a budget year. Fortunately, that part of the problem can be fixed.
Under the City Charter, New Orleans' citywide elections are held in February and March every four years, with inaugurations on the first Monday in May. The city's budget year begins on Jan. 1, however. That means every outgoing mayor can sign contracts and commit public funds well into a budget that a new mayor and council will have to balance. History has shown that to be a prescription for disaster. It's like giving someone unfettered use of your checkbook for four months, then having to cover any overdrafts.
We think every new mayor and council should get a fresh start — and a fresh budget. To make that happen, New Orleans should hold its citywide elections earlier — in September and October — so the incoming mayor and council can be sworn in as early as possible in the new year, say the second Monday in January. This would leave three months for a transition, which is longer than the present system allows, and succeeding administrations and councils would not have to worry about inheriting mid-year deficits. Equally important, we think every mayor should have to get two-thirds approval from the City Council to sign any contract that obligates the city beyond the last full year of his or her term.
These changes require amending the Home Rule Charter. Advancing the election dates also requires changing state law. Moving up the inauguration date will shorten the term of Mayor-elect Landrieu by about four months, so it's important that the new mayor embrace this idea. If he is sincere in his request that Nagin cease his spending spree, Landrieu should not hesitate to limit his own potential to overspend. The incoming mayor built his reputation on reform and selfless leadership; this idea demonstrates both.
We hope Mayor Nagin will summon the restraint and good sense to stop bankrupting the city. We are not optimistic. Going forward, we hope the new mayor, the new council and state lawmakers will take the steps necessary to make sure no future mayor can wreak the kind of fiscal havoc that Nagin seems furiously determined to leave as his legacy.