Will we ever Make It Right?

We have to say it's a remarkable trip the City of New Orleans has been on with short term rentals for the better part of the last decade only to end up right back where we started. We've been through years and years of hearings, hotly debated regulations that don't work, hotly debated revisions to those regulations that continue to not work, at one point we even decided to go the whole nine and turn enforcement responsibility over to an industry profiteer.  A whole lot of things have happened. But also nothing has changed.  This article says it's "inexplicable" but is it?  

With New Orleans' spring tourism season in full swing, the Cantrell administration’s stated plan to crack down on illegal short-term rentals is inexplicably stalled, leaving scofflaw operators to freely list unpermitted rentals on Airbnb and other online booking platforms.

Pinning down just how many unpermitted rentals are available is nigh impossible, but data provided by the technology firm Granicus, combined with City Hall's short-term rental registry, suggests they outnumber legitimate ones at least 3 to 1.

There's probably a very simple explanation, actually. Helena Moreno seems pretty close to getting it right here. 

Council member Helena Moreno said she is baffled by the administration’s flagging enforcement efforts. 

 “With the lack of enforcement and slow-walking of accountability measures, it makes me wonder whether this is purposeful,” Moreno said.

It's hard not to think that. Otherwise, it would be difficult to explain why the city would be leaving so much money on the table. As Moreno also points out, the city has somehow never managed to give anyone a straight answer as to how much money it actually collects in fees and fines under the current STR enforcement regime. Strange behavior for an administration that has been otherwise diligent in chasing down drivers ticketed by its robots or shutting down any street parade or music venue not able to pay the premium fees. We know the city wants to collect its money.  It's just particular about who actually has to pay. 

Now I'm not honestly recommending that any normal person with actual things to do tries this, but, for those who really must, you can view last Wednesday's meeting of the city revenue estimating conference here.  Watching these meetings one gets a (rather grim) feel for what this administration's ideas are about the city's economy and who it is supposed to serve. For example, during a discussion on employment numbers, Gilbert Montano briefly references the "Great Resignation" to signal his sympathy with the "people don't want to work" myth popular among bosses these days. (Actually the labor participation rate is nearly back to pre-pandemic status now. But that isn't going to stop the ownership class from demanding we continue to shred what's left of the social safety net just in case any workers out there feel even the slightest hope.) At the REC, the Cantrell administration generally sound like they are the corporate board of a big hotel. Almost all of the metrics highlighted in their presentation are based on how well the tourism business is going; how many visitors fly in and out, how many hotel rooms are occupied, etc.  The first time I saw LaToya Cantrell speak publicly about short term rentals her comments were already very much shaped by a hospitality management mindset. Even while she assented to the point that they may be raising housing costs, she basically looked past that to assert that New Orleans is a "destination city" and that STRs are a source of revenue.

But Cantrell is "the mayor right now" and somehow all that revenue isn't finding its way into city coffers. Property values are up, rents are way way way up,  but according to city projections, property tax revenue is down slightly.  At the meeting, much of the discussion about that centered on assessor Erroll Williams. In September, Williams granted across the board breaks to property owners following Hurricane Ida.  The fact that Williams's office has apparently granted some invalid corporate exemptions was also mentioned. 

Near the end of 2020, three local government agencies denied tax breaks for planned improvements to the Folgers coffee plants in New Orleans East. But only now, more than a year later, has the assessor put the properties onto the tax rolls, making the company liable for $5.1 million in real estate levies.

Assessor Erroll Williams blames the Louisiana Department of Economic Development for the delay. That agency blames Williams.

That T-P story details circular arguments from the assessor and from LED about who is supposed to inform whom about ITEP denials. But, I dunno, I think one thing an assessor might do in a case like this  is call somebody and ask?

Williams said his office was following its standard practice: Don't put properties on the rolls while their applications for tax breaks are still pending. He said his office asked the state about Folgers in February because the state database did not yet show the tax breaks were denied and he had received no formal paperwork from any agency saying a decision on the breaks had been made.

"This office hasn’t gotten a letter from the School Board, city of New Orleans or the Sheriff’s Office that they’ve decided to vote the contract down, so I can’t put a taxpayer on the rolls based on what I read in the newspaper," Williams said.

The status was not changed to “denied” until March, at which point Williams said his staff began working to put the properties on the tax rolls.

The state agency said it “does not notify local taxing authorities about the actions of local government entities involved in the ITEP application review process. Questions about when and how the exemption is applied at the local level are best directed to each local taxing authority.”

Hard to believe these people can't all get together and talk one way or another. This just isn't that big a town.  Especially now that nobody actually lives here. Who can afford to, anyway?

Anyway, not to give the REC any more work to do but it turns out there are other places to dig for lost property tax money if they're feeling hard up. 

In total, Make It Right owes $14,972.81 in back taxes and fines, which are added to a property’s tax bill once they become delinquent. Most of that debt was accumulated in 2021, when the foundation failed to pay taxes on any one of its properties. And It’s possible that number will grow even higher for unpaid 2022 taxes, which are due today, March 31. 

According to the city’s online tax records database, the foundation owes $9,493 in 2022 property taxes. But The Lens was unable to confirm that the foundation has not paid that down. It appears that the city’s digital property tax records haven’t been updated to show whether property owners have yet paid their 2022 taxes. Officials did not respond to questions about the group’s 2022 property taxes.

Or maybe this is another thing where they've got to wait on Erroll to update the spreadsheet. 

One last point about the REC. Montano et al are still being extremely cautious with their use of the American Rescue Plan dollars by projecting it out over the course of a five year hypothetical revenue gap instead of applying it toward the addressing the city's numerous critical human services and infrastructure needs. (Notice how they are not shy about throwing that money at police as fast as they can, however.)  Back in August, we wrote more about how this administration's ideological conservatism informs its approach to budgeting.   On Wednesday, the projections we saw did not account for the next tranche of ARP dollars promised to cities because there was still talk in Washington about clawing those funds back in the next spending authorization.  As of this writing, though, it looks like that money is still coming.

Under the emerging deal, Mr. Romney, said, most of the $10 billion would be repurposed from the $1.9 trillion pandemic law Democrats muscled through without Republican support last March. But direct funds for state and local governments would likely not be touched, after Democrats balked at this money being clawed back. Mr. Romney said negotiators had discussed taking back some funding from a program that allowed states to give grants to local businesses.

That's pretty good news. But it could be better.  The way it looks right now the primary benefit of the federal bailout is it allows the city to keep letting wealthy property owners slide on their responsibility at the current rate. Without it, they'd still do that, of course. But they'd have to crack down even harder on the poor than they currently do to make up the difference.

Let's see if they notice

Remember those old Foldgers Crystals commercials?  You know the ones where they go into some fancy dining type setting and surreptitiously replace the gourmet coffee with the instant product like they're doing a Candid Camera type prank to "see if anyone notices." We have a new version of that in New Orleans. See what happens is Assessor Erroll Williams continually replaces Foldgers's tax liability on his spreadsheet with some fake number he doesn't bother to explain.

But this week, Together New Orleans issued another memo claiming the assessor is still leaving out $1.6 million from Folgers’ bill. And, the group says, his undercount suggests a troubling internal practice that could be erroneously giving extra tax breaks to hundreds of millions of dollars of business property throughout the city. 

To make matters more confusing, the Assessor’s Office has since admitted that the $6.5 million figure it released last week was itself inaccurate, but not because of the reasons cited by Together New Orleans. 

Williams’ spokesman Devin Johnson would not tell The Lens why that number was inaccurate, only that “the preliminary estimates missed the mark” and that the office would release more accurate numbers once they were finalized.

“I wouldn’t read too much into the numbers on the spreadsheet,” he said. “The final numbers are going to be significantly different.”

Johnson also accused The Lens of trying to produce “clickbait that’s biased and factually inaccurate.”

“So nothing new there,” Johnson said.

This isn't the first time a city official has published incorrect data only to turn around and scold a reporter for correctly reading what was disseminated.  Last year the City Attorney's Office withheld information from The Lens about short term rental fees until after their story was published. The subsequent release of data forced a "correction" of sorts.  I'm starting to wonder if this a deliberate tactic. 

Anyway, regardless of what his spreadsheet says, Williams is clear enough about his priorities. 

Soon after that, the City Council formally called on the assessor to create a new written policy for reviewing exemptions granted through what has historically been the state’s largest tax subsidy program — the Industrial Tax Exemption Program, or ITEP.

But the request was passed in a non-binding resolution. Because the assessor is an independently elected official — not a part of city government — the council has no legal authority over his office. 

Williams explicitly told The Lens at the time that his office would not create a new policy. Instead, he would stick with the process he already had, even though, he admitted to The Lens, it was flawed and wasn’t adequate to catch the kind of mistake that Together New Orleans had discovered.

“The review process is not going to catch it,” Williams told The Lens in 2019. “It’s not the greatest priority for our office, obviously.”

Now, the office has once again undercounted Folgers’ tax bill. And, as was the case in 2019, the mistake raises the questions of what would have happened if Together New Orleans had not identified the error, as well as what other errors may be in the city’s tax rolls.

There's also some back and forth in the article between Williams and Together New Orleans over when or whether he is considering every appropriate factor in drawing up his assessments. Apparently the answer there is mostly "sometimes."  So, it still takes an exacting palate to tell the difference. 

Ripe for the picking

The race to stop COVID before the situation becomes much worse is more urgent than ever. We are told there is "no way to sugarcoat" that.  

If the variants alter the virus enough, tests, treatment and vaccines might not work as well, said Straif-Bourgeois. A new variant might be able to slip past antibodies, re-infecting someone who has already had COVID-19. Potentially, such a variant could complicate the path to herd immunity.

“There is no way to sugarcoat this,” said Garry. “It does look like some of the variants may not be as effectively blocked by the vaccine.”

The virus is leveling up. The longer these variants are out there unchecked, the more likely they are to develop into something that beats the vaccine. If those strains become dominant worldwide then we have to start all over. As of right now, we are told the vaccines are still effective against the so-called "UK variant" everyone is worried about.   But also that more infectious and deadlier strain has been detected in New Orleans already. So this is not the time to let up on our mask and distance precautions. It's not the time to pressure the schools to reopen. And it's definitely not the time to be welcoming visitors for Mardi Gras.  This is the time to get some shots into some arms, as they say. 

And for a minute there it seemed like that was indeed the plan.  But then a funny thing happened. 

The Biden administration has told Louisiana officials that shipments of the coronavirus vaccine won’t be increasing much for at least a month, the latest challenge to the state’s effort to ramp up vaccinations.

The revelation that shipments won’t be increasing — which has long been the promise made to states by federal officials — means Louisiana likely won’t be able to hold mass vaccination events anytime soon, Gov. John Bel Edwards said at a press conference Friday.

Vaccine shipments to the state this week and next are expected to remain flat at about 58,000 doses per week, with potentially only a 5% to 10% bump through most of February. Louisiana has received roughly flat shipments of vaccine doses for the past month, Edwards said, amid supply issues that are impacting distribution across the U.S.

Whoops! They took the Trump administration at their word and that turned out to be bullshit. Now the planned ramping up of vaccinations could be delayed by a month or so.  Do we have even that long before things get even more complicated?  Guess we'll find out. 

Either way the "post-pandemic era" is coming.  We might decide to mark its arrival at the time of our successfully containing the virus. Or we could call it when get a certain percentage of the population vaccinated. More than a few people might like to mark it at the end of Joe Biden's first 100 days in office.  It really depends on how soon you might want the checks to stop coming. But wherever we decide the pandemic ends, the conditions it will leave in its wake are setting us up for a cascade of further disasters which we are not likely prepared to mitigate. 

For example, I'm very curious where we decide to define the new level of "structural unemployment."   

The labor market has rebounded somewhat since the initial coronavirus wave in the spring. But of the 22 million jobs that disappeared, nearly 10 million remain lost.

“Compared to then, we are doing better,” said AnnElizabeth Konkel, an economist at the career site Indeed, referring to the spring. “But compared to the pre-Covid era, we still have so far to go.”

Consider that each of the last four recessions has occasioned a deeper and longer lasting period of job loss than its predecessor. The so-called "Great Recession" of 2008 was historically frightening.  Here is a somewhat famous very frightening graph of our declining economic resilience. 

These numbers do not even tell the whole story, of course. Each recession sets off a new exacerbation of precarities as the jobs that comprise each recovery are more exploitative and less secure with fewer hours and fewer benefits. So even as the line eventually goes back up, material conditions continue to worsen. 

To dig ourselves out of that hole we are going to need a more aggressive and determined commitment from the federal government than we have seen in generations.  We will need real support and relief. That should come in the form of monthly payments to make up the income lost during stay-at-home orders. It should include a guarantee that your boss can't expose you to danger and that a landlord or a bank can't kick you out of your home.  We need to rescue our state and municipal governments before they collapse into bankruptcy exposing everyone to more chaos.

Unfortunately, none of the above is Joe Biden's priority. Making Mitch McConnell happy is. 

President-elect Joe Biden will seek a deal with Republicans on another round of Covid-19 relief, rather than attempting to ram a package through without their support, according to two people familiar with the matter.

The approach could mean a smaller initial package that features some priorities favored by Senate Republican leader Mitch McConnell. The idea is to forgo using a special budget process that would remove the need to get the support of at least 10 Republicans in the Senate, which will be split 50-50 and under Democratic control only thanks to the vice president’s vote.

Rather than taking the challenges of the pandemic-depression seriously, Biden's first concern is rehabilitating the image of the Republican Party after its leadership instigated a riot at the Capitol intended to disrupt the certification of his own election.  And since delivering justice or even just the hope of a better world isn't as important as making sure he's got a  "strong opposition party" around to do deals with, Joe is opening the negotiations at... one time checks for $1400. 

The stimulus package has a price tag above $1.5 trillion and includes a commitment for $1,400 stimulus checks, according to a source familiar with the proposal, and Biden is expected to commit to partner with private companies to increase the number of Americans getting vaccinated.

A significant portion of the additional financial resources will be dedicated to minority communities. “I think you will see a real emphasis on these underserved communities, where there is a lot of hard work to do,” said another transition official.

We'll examine that "emphasis on underserved communities" more closely when there are more details. But there isn't much reason to believe this is anything beyond the usual noble-sounding framing for unnecessary and counterproductive means testing.  More to the point, after everything that's happened, pushing people to accept $1400 as $2000 if you count the accrued $600 store credit from December is just shitty messaging. Even though we've shoveled trillions of dollars in tax cuts and subsidies for billionaires out the door all year, Joe wants you to know now that he is counting every penny you might get your grubby little hands on. 

The millionaires who comprise the Biden led faction of congressional Democrats may not feel this personally but their performative miserliness put on to please the op-ed writers does more than just insult people. It abandons whole communities to ravaging predators. 

The New Orleans area has earned an unwelcome financial distinction during the coronavirus pandemic: more homeowners here are at risk of losing their homes due to unpaid mortgages than in any other major American city.

More than one-in-ten borrowers in the New Orleans-Metairie metro area are now at least 30 days late with mortgage payments and could be at risk of foreclosure on their properties, according to federal data.

New Orleans was already being hollowed out and gentrified by predatory capital before the pandemic began.  Without drastic action, COVID will surely lead to an exponential expansion of that crisis. 

"Our numbers for folks seeking help with evictions already are through the roof — up 300% since the pandemic started," said Laura Tuggle, executive director of Southeast Louisiana Legal Services, a non-profit legal aid provider for low income Louisianans. "The deluge on mortgages is going to come."

With a relatively high concentration of low-income households, the New Orleans area already had one of the nation's highest mortgage delinquency rates before the pandemic, according to Andy Walden, economist and director of market research at Black Knight, a Jacksonville, Florida, firm that tracks mortgage trends nationwide.

That story is from a few weeks ago. There is a new one in today's paper that further confirms what's happening here. Housing sale prices are up in Orleans Parish by 16% this year.  But those numbers really just show us the rich getting richer.  Meanwhile...

Meanwhile, the broad numbers mask big discrepancies between the upper and lower end of the market, and some of the strains in housing across the area. According to federal data, more than one-in-ten borrowers in the New Orleans-Metairie metro area are at least 30 days late on their mortgage payments, putting them at risk of foreclosure.

About a month ago we wondered what was happening with the "large portfolio of foreclosed properties" that had been held by the embattled Bank of Louisiana before the younger generation of management there began selling them off.  We wondered about that specifically because a foreclosure crisis is typically followed up by a wave of vulture capitalism that results in even more intense and damaging wealth consolidation. One can only assume that will get even worse now with so much of the city ripe for the picking.

So we find ourselves, not only in a desperate race to stop the virus before it mutates beyond our control, but also in a race to protect working class New Orleanians from the ravages of the post-pandemic economy. At the beginning of the year we wrote that policy choices by both the mayor and the assessor indicate they intend to side with the asset speculators over the city's residents. In this month's Antigravity, MACCNO voices similar concerns about the assessor. 

Cutting property taxes for commercial property owners—who tend to be wealthier and whiter than the general population—without a corresponding benefit for commercial tenants, while simultaneously increasing residential property taxes and rent, would be a recipe for displacement and gentrification no matter when it happened. But during a pandemic that has already created economic disaster for musicians, small businesses, artists, and other members of the cultural community, the effects could be especially devastating. Williams himself acknowledges the situation he is creating but avoids responsibility, telling The Advocate he “is not the tax collector,” even though he doesn’t “see how everybody is going to be able to pay their taxes on time.”

Is anyone coming to help? It's not clear that they are. Biden's inaugural speech sounded a lot like a redux of his convention speech. Which is to say he was long on affected empathy for your suffering but short on resolve to do anything about it. The "unity" talk even evoked unpleasant Mitch Landrieu "One City One Voice" flashbacks. Yes, of course, bad things are happening to you. Maybe you've lost your job. Maybe you can't pay for health care.  Maybe you are facing eviction. Maybe the planet is on fire and we're facing a future of diminishing prospects for most of us. We know about all of these things and acknowledge that they are bad.  But the one thing we really can't tolerate is any complaints.

So Joe Biden is going to open the schools in 100 days.  If we can't vaccinate people by then and the virus is still out of control, that is too bad. Someone will just find a way to blame the teachers. So New Orleans is open for Carnival visitors.  If cases start to spike because workers were compelled by their bosses to go serve food and drinks to tourists, that is too bad. The mayor will inevitably just go on TV and yell at the residents again.  The post-pandemic is coming.  Hopefully it comes sooner than later because lives are at stake in that.  But, in its wake, the fortunes and livelihoods of the vulnerable working class are going to be exposed. And it's highly doubtful they'll find many friends in power willing to do anything about that.

Keeping the faith 2021

Happy New Year! Pandemic is over now. Congratulations to all who participated. 

(CNN)President-elect Joe Biden received his first dose of the Pfizer and BioNTech coronavirus vaccine on live television Monday afternoon and reassured Americans of the vaccine's safety.

The shot, which Biden received in his left arm, was administered at ChristianaCare's Christiana Hospital in Newark, Delaware, by Tabe Mase, who is a nurse practitioner and the head of employee health services at the hospital, according to the Biden transition team. 

 

"We owe these folks an awful lot," Biden said, thanking those involved in the vaccine's development and distribution and front-line health care workers. 

 

Biden said the Trump administration deserved "some credit" for Operation Warp Speed, the federal government's vaccine program, and their role in making coronavirus vaccinations possible.

Certainly we do love to get up every day and remember to give Trump "some credit" for everything that's gone on this year.  But let's try to remember that.. popular and electoral vote counts notwithstanding... he isn't the only winner. 

The real winners are the bosses. The bosses have won the pandemic.  They actually have been the winners since the very beginning but if you read this website you would have seen us bleating about it many times over already.  We could already see how they were going to win early as March. Before the CARES act even passed it was clear that first shot at a federal response was going to be the one opportunity for a just outcome . And it was just as clear we were well on the way to missing it.  I didn't explicitly use the phrase "bosses are winning the pandemic" until about a month later but anyone could tell what was happening. By May we had the whole picture and it has not changed since. 

Eventually they're just going to make everyone go back to work. The Brennans will send a six foot rabbit to force us there at the point of a sword. Those of us there are even jobs for, that is. Those of us that can be used under whatever temporary and tenuous conditions that are set down. It will happen before anyone is safe from the virus. If there is no further action from congress and the status quo order is already maintained, everything will still be as broken as it is now and we will all be several orders of magnitude poorer for it.  Poorer workers are cheaper workers. When unemployment is high they are more disposable. The conditions that force them to work despite the danger make them easily exploitable. The bosses have won the pandemic.

I don't bring that up to get in a cheap I-told-you-so. If you read this website you also know nothing I can tell you matters.  I just want to point out how obvious all of this has always been even to an idiot blogger who only knows what he reads in John Geroges's newspapers. 

From the moment the pandemic hit, the most likely thing to happen, as has been the case with every of our century's many disasters, was yet another concentration of wealth and power at the very top and a further immiseration and impoverishment of the vast majority.  Jesus I said that too way back in March.  Look, if you are wondering why there has been less and less posting on the yellow blog as this year has gone along it's because fewer and fewer new things have happened as it's gone along.

 Anyway here we are a few days before the end of the year and how is all that going? 

Meanwhile, America’s wealthiest have seen their fortunes soar. The 100 richest people in the U.S. added about $600 billion to their wealth in 2020, enough to send a $2,800 check to every adult in the country. One, Tesla Inc.’s Elon Musk, ended 2020 six times richer than at the beginning of the year.

Individual billionaires getting more billions? Check.  The engines that siphon the billions upward continue to crush and devour everything in their path?  Check on that too. 

“The COVID-19 pandemic has generated record profits for America’s biggest companies, as well as immense wealth for their founders and largest shareholders—but next to nothing for workers. In a report published last month, we found that many of America’s top retail and grocery companies have raked in billions during the pandemic but shared little of that windfall with their frontline workers, who risk their lives each day for wages that are often so low they can’t support a family. This is especially true of Amazon and Walmart, the country’s two largest companies. Together, they have earned an extra $10.7 billion over last year’s profits during (and largely because of) the pandemic—a stunning 56% increase. Despite this surge, we ranked Amazon and Walmart among the least generous of the 13 large retail and grocery companies studied in our report. The two companies could have quadrupled the extra COVID-19 compensation they gave to their workers through their last quarter and still earned more profit than last year.”

Sounds about like mission accomplished, right?  Well, they're almost there.  As I type this right now, I'm watching Mitch McConnell fend off a last minute attempt by Bernie Sanders to tack a one-time $2,000 payment to individuals onto the jumble of giveaways to Wall Street firms and defense contractors that just passed as the (likely final) COVID relief bill.

They wouldn't even be there had our ingeniously unstable President not thrown one last incoherent fit during which he happened to mention that $2,000 is a larger amount than $600. Before Trump opened his mouth, the deal was already closed. Our leading opinion makers were well on their way to lionizing the moonshine sipping centrists who brought it to us and explaining that it was "good enough" the way it was. Who would have thought we might actually miss having Trump around to light random things on fire like this?  Going back to brunch is going to suck. 

Or maybe it doesn't matter. McConnell seems to have the situation well in hand. 

McConnell introduced the parallel pandemic relief bill on Tuesday, S.5085, which would include the $600 to $2,000 increase in checks to individual Americans, but tacks on a repeal of section 230 of the Communications Act of 1996 and funding for a commission to investigate voter fraud. Both of these additions to McConnell's surprise bill are demands which have been made by Trump for months. The Section 230 repeal would pull back protections for internet companies and allow such media companies as Twitter and Facebook to be sued if users feel wronged by messages on the platform.

Aside from maybe Dick Cheney, Mitch McConnell is the most consequential American political figure of the 21st Century.  Over the course of the previous two Presidential administrations, McConnell has completely turned over the federal judiciary. He delivered trillions of dollars in tax cuts for the corporate ruling class.  Now he is leveraging the pandemic to crush workers' rights and bankrupt every state and municipal government which will result in radical austerity nationwide. When future historians write about the dawning of the American neo-feudal age, McConnell will be remembered as a prime architect.

Not to give him too much credit.  I mean being an insider hatchet man for the establishment is always an easier job than trying to protect the disenfranchised.  That's kind of the definition of how power works. McConnell isn't engaging in any dark wizardry. He's just making obvious moves that no one can muster the effort to counter.  It's very easy to muck up something everyone wants by tying it to something else everyone know cannot pass.  State and local governments need relief but McConnell killed that by tying it to liability shields for bosses who callously expose workers to danger during the pandemic. And now he has blocked these one time survival checks by tying them to internet censorship and Trump election conspiracy crap. Being a jerk really isn't that hard as long as you are sufficiently insulated from any consequences.  

So McConnell isn't the definitive US politician of the moment just because he happens to be the guy in position to pull the lever on the machine that feeds the abattoir. It's more the fact that he, or any person who would get to work those controls embodies the universal ethic of the governing class. It's a power that only does one thing. And so anyone who seeks to wield that power necessarily wants to do that thing. Which is another way of saying they're all like this. None of them is here to help.  In fact as I'm continuing to type now, I see the Democrats in the Senate have, in fact, caved on their gambit for the $2000. It looks like they decided it was more important to continue funding the current push for war with Iran.  Here's Joe Biden barely acknowledging the issue while literally turning his back and walking away.  You're not going to get a clearer image of where the Democrats are than that.

Of course, a one time check for $2,000 or even the $2,800 we could have by splitting up the billionaires' profits from this year is still an insult. A just pandemic response policy would pay people to stay home, protect them from their exploitative bosses and rapacious landlords, guarantee treatments and vaccinations are free, and "re-start the economy" through continued fiscal stimulus on the back end.  But we'll never do any of that. All we care about, even at this very late stage of the game, is keeping the military and police state funded while also giving away billions of dollars to rich people. 

WASHINGTON — Tucked away in the 5,593-page spending bill that Congress rushed through on Monday night is a provision that some tax experts call a $200 billion giveaway to the rich.

It involves the tens of thousands of businesses that received loans from the federal government this spring with the promise that the loans would be forgiven, tax free, if they agreed to keep employees on the payroll through the coronavirus pandemic.

But for some businesses and their high-paid accountants, that was not enough. They went to Congress with another request: Not only should the forgiven loans not be taxed as income, but the expenditures used with those loans should be tax deductible.

The truly remarkable thing now is how little it matters that the supply side philosophy guiding such policy has been repeatedly discredited over the course of our 50 year experiment with it. Tax privileges for the one percent do not magically raise revenues. They do not end racial inequality. They do not "create jobs" or raise the general standard of living.  No matter. Our leaders will press on with it as an article of faith. It's the central creed of both parties from Congress all the way down to your local City Council. Giving money to rich people is the reason our electeds are called to service.  The hours are running short on the year now. But real quick, here are a few of our favorite local examples of neoliberal gospel preached in 2020. 

Just last week, Governor John Bel proudly announced a plan to give away $3 million in state funds to a company owned by the world's richest man who proposes to "create jobs" paying $32,000 on average.

Besides the access to Interstate 49 and 10, Amazon is eligible for a performance-based grant from Louisiana Economic Development of $3 million. The grant is payable over two years and can offset facility infrastructure costs. The state will also give Amazon access to LED FastStart, the state's workforce training program, which has given 463,000 training hours to more than 29,000 employees since 2008.

In October, with Orleans Parish homeowners still reeling from last year's property tax assessment, and renters facing a wave of evictions as CARES act protections and unemployment benefits ran out, Erroll Williams announced a $42 million tax cut for corporate owners of downtown commercial properties. 

According to data compiled by the Downtown Development District, almost a third of the total cut in commercial sector valuations — or about $90 million — is accounted for by 10 downtown properties, including the cluster of properties at the river end of Canal Street owned by Harrah's New Orleans Casino, a division of Caesars Entertainment of Las Vegas. Harrah's valuations were more than halved to about $15.3 million, which will reduce its property tax bill by an estimated $2.4 million, according to the assessor's office.

Similarly, the Marriott Hotel on Canal, the Sheraton, the Intercontinental, the Crowne Plaza, the Roosevelt and the Ritz-Carlton will see their property taxes halved.

All are owned by national hotel management groups, suggesting that any tax savings will head to corporate coffers outside of the city.

This gift to out of state mega-landlords will be paid for by about a $12 million dollar drop in revenues meant for public schools and services while homeowners and renters will have to pay $30 million more collectively. 

But let's not get too caught up in the distinction between businesses and neighborhoods. Because another thing we learned this year is that the city's official position is that neighborhood ARE businesses. 

“I really want to be thoughtful on the term business, because we were worried that there may be criticism that we only are thinking of businesses. I say business as a very global perspective where neighborhoods are businesses in my mind. People that have never been through this process and want to expand their gate, those individuals, those customers are businesses. So it’s not just ‘hey let’s help big business.’ “

That is New Orleans CAO Gilbert Montano employing a special kind of capitalism-inflected gobbledygook to talk about his plan to reorganize city planning, permitting and land use departments under something called the Office of Business and External Services. The scheme, which Montano describes as a "paradigm shift," would essentially change the mission of these agencies from protecting  public safety and quality of life from the hazards of profit-driven development to assisting the profit-seekers in getting around those protections.  

As if to drive the point home, the person they hired to implement this new vision made his own fortune monetizing the gentrification of New Orleans neighborhoods. 

Bowen’s new position caught the attention of some affordable housing advocates on Monday due to his former job as general manager of Sonder — a San Francisco-based company that has grown to be one of the largest operators of short-term rentals in New Orleans. In the resume he submitted for the job, Bowen claimed that during his tenure at Sonder he “Blitz Scaled the New Orleans market for Sonder from launch to 1,000 apartments (2,500 rooms) in under 36 months.” 

A report from March 2018 by Jane Place Neighborhood Sustainability Initiative, an affordable housing group that opposed the expansion of the legal short-term rental market in the city, found that Sonder had more listings on Airbnb than any other short-term rental operator in the city with 124.

Neighborhoods are businesses.  They are fodder for "blitz-scaled" profits regardless of whether anybody can actually live there.  It probably helps if they don't, in fact. That way they won't need things like public libraries which, incidentally, the city proposed to de-fund in order to pay for Bowen's new neighborhood monetization department. That proposal was killed by voters. But it's only a temporary set-back. It's clear where the city's priorities lie. Eventually they'll get the budget to follow. 

To expect anything different would be to expect a sudden conversion of the entire political class away from its religious belief in trickle-down economics.  But why would that happen when our priests continue to reaffirm their orthodoxy over and over?  As our final example, we have here one of Mayor Cantrell's very first actions in response to the emergency way back in March. She decided to give businesses a tax break. 

Despite worries about the city’s bottom line, Cantrell announced on Tuesday that the city would waive all penalties for late sales tax payments from businesses for the next 60 days. That measure is intended to make sure businesses have the money on hand to keep paying their employees while state and city closures are in place during the height of the outbreak.

What could possibly go wrong? Well they did ask her that. 

Given the strains to the city budget, Cantrell urged those businesses who are remaining open and can pay their sales taxes to do so, to lighten the burden on city government. Asked about concerns that businesses would simply pocket the money, not turning it over to their workers or to the government, Cantrell said she choose to look at the situation from an optimistic perspective.

“I’m not being negative at all and thinking that our businesses or employers will not do the right thing,” Cantrell said. “This is all with the expectation that they’ll do the right thing.”

Don't be "negative." Just hold fast to the belief that doing nice things for those at the top of the ladder will result in nice things for those at the bottom. For ever and ever amen. Anyway, the true believers only need to hold out a bit longer. The sooner we can declare the pandemic over, the sooner we can dismiss any heresy that suggests that poor people have anyone besides themselves to blame. 

The savior is coming in the form of a vaccine... eventually... maybe.

It’s happening all over again. For months, Americans who despaired about the country’s coronavirus-suppression efforts looked desperately to the arrival of a vaccine for a kind of pandemic deliverance. Now that it has arrived, miraculously fast, we are failing utterly to administer it with anything like the urgency the pace of dying requires — and, perhaps most maddeningly, failing in precisely the same way as we did earlier in the year. That is, out of apparent, near-total indifference.

Well, they'll figure it out.  After all, as Joe Biden might say, we gotta give Trump some credit. Just have a little faith.

These two items are not related

The way this story presents the information, a casual reader might conclude that Caesar's "pledged" to uphold its obligations under its licensing agreement because Erroll Williams gave them a tax break. Rest assured this is not the case. 

Part of Caesars' pledge on the license extension deal was that it would continue to employ at least 2,400 people and add 500 staff after the hotel was built. It also committed to pay for various state and city infrastructure projects, including $19.5 million over three years to New Orleans.

Earlier this year, Caesars got a big break on one of its biggest city bills. The casino operator was one of the prime beneficiaries of a decision by the Orleans Parish Assessor to cut property valuations for 2021 — and thus cut property taxes — for businesses in the area because of the unprecedented effects of the coronavirus pandemic. Hotels saw the highest valuation cuts, at about 58%, which translates into an annual savings for Caesars of an estimated $1.5 million to $2 million.

The license agreement has nothing to do with the property tax assessment. The license agreement was negotiated with the legislature in the spring of 2019. The tax break is part of a larger corporate giveaway cooked up by the Assessor's office this year. Just after homeowners saw their assessments go up dramatically and as housing costs remain high while workers are being laid off left and right during a pandemic, Erroll Williams and Michael Sherman arranged to hand over $42 million to commercial landlords with deep corporate pockets.  I know the placement of the two paragraphs above in today's story might make it look like this has something to do with Harrah's/Caesar's lease. But it does not.  

Meanwhile, Did You Know.. next Friday your beloved City Council and School Board are scheduled to approve a series of back-tax exemptions that would cede another $25 million to Folgers. Last month when the state Commerce board gave its preliminary approval to the exemptions, a certain parish assessor took their side. 

At Friday’s meeting, Folger consultant Jimmy Leonard said the company requested the delay simply because it wanted the board to consider the application along with the company’s other newer applications at the same time. Leonard also presented a letter to the board from Orleans Parish Tax Assessor Erroll Williams describing Folger as a good taxpayer that has been transparent with him throughout the process. 

Together Louisiana members were armed with a letter of their own — from New Orleans Councilwoman Helena Moreno — that painted a different picture.

“A recent investigation by journalist Lee Zurik on WVUE-TV brought this matter to the public’s attention in August, due to the alarming length of time of not paying millions of dollars of taxes and now seeking a loophole to get a pass,” Moreno wrote in the Oct. 26 letter. “The total owed could be as high as $12 million…We cannot afford for a large corporation to not pay its fair share when our residents and small business owners are being asked to sacrifice so much.”

The board, nevertheless, approved Folger’s application because it was up to the tax assessor to place the property on the tax rolls, which he never did, Board Chairman Jerald Jones said.

Together New Orleans has scheduled a rally and press event at City Hall to discuss the Folger's situation. Although, at the moment that page says the event is Friday in the headline and Monday in the text. So maybe check back when they have it sorted out.

Austerity isn't just an accident of nature

It is city budget season.  Happy Holidays. There will be quite a few of those in the future for these folks.  Unpaid, of course. 

Chief Administrative Officer Gilbert Montaño told City Council members in a special meeting Monday that under the budget plan set out by Mayor LaToya Cantrell and her administration, furloughs that took effect this month for employees should continue through next year. 

Employees would be furloughed for one day per pay period, or 26 furlough days over the course of the year, Montaño said. People who earn less than $30,000 a year would be excluded from the pay cut. 

The city's public safety departments, such as police and fire, will also take a 6% and 8% cut to their overall budgets, while other departments could see up to a 40% cut, he said.

Wow. Especially sucks to be the "other departments".  

The hardest hit departments include Public Works, which will see its funding drop more than 40% to $34 million. That decrease includes cutting about 10% of its total positions.

The City Planning Commission, which is responsible for reviewing development proposals, is also slated for a 40% cut, will lose 6 of its 26 positions. The Vieux Carre Commission, the small agency that enforces the historic preservation rules in the French Quarter, is facing the deepest cut in the city at 42%, will lose two of its six spots.

To explain itself, the administration cites the obvious.  A compounding crisis of pandemic-induced depression has caused a sudden drop in expected revenues.  The federal government has failed to respond adequately and what aid it has made available has been watered down and diverted at the state level.  

All of this is, regrettably, true. But it's important to also keep in mind that many of the consequences of that disaster are still left to our local lords to decide. There are individuals in charge right now who impose their values on the question of who suffers the most during the disaster.   The above mentioned cuts in this budget are one example. The pandemic didn't decide the cut Public Works by one amount but NOPD by another.  Similarly, the pandemic didn't decide that businesses shouldn't have to pay the sales taxes they collected during Mardi Gras. Their lobbyists told the mayor that's what they wanted and she agreed to it.   The pandemic didn't decide it was time to give corporate landlords a big tax break paid for by residents and through layoffs. The assessor made that call.  

And, of course, we know the pandemic can't read the city ordinances but we are pretty sure that wasn't who decided to ignore this (admittedly toothless) city council decree that we would no longer stiff the Public Defender's office.  A person did that. On purpose.

Just stripping it for parts now

We're almost past the point of abandoning pretense.  At the same time that New Orleans administrators find themselves begging for help before a hostile audience in Baton Rouge, threatening city workers with furloughs and layoffs, and drastically cutting back on public services, it has been determined that now is also an excellent moment to give away millions of dollars to corporate entities who definitely do not need them.

Some of the biggest cuts will be for the largest downtown hotels, including the Marriott on Canal Street, the Hilton Riverside, and the Sheraton, as well as Harrah's Casino New Orleans and its adjacent properties.

Each could see their tax bills drop by between $1.5 and $2.5 million, based on current millage rates and estimates from data provided by the assessor.

The assessor says this is about helping "small businesses" and the local hospitality industry. But look at where the bulk of this goes. 

According to data compiled by the Downtown Development District, almost a third of the total cut in commercial sector valuations — or about $90 million — is accounted for by 10 downtown properties, including the cluster of properties at the river end of Canal Street owned by Harrah's New Orleans Casino, a division of Caesars Entertainment of Las Vegas. Harrah's valuations were more than halved to about $15.3 million, which will reduce its property tax bill by an estimated $2.4 million, according to the assessor's office.

Similarly, the Marriott Hotel on Canal, the Sheraton, the Intercontinental, the Crowne Plaza, the Roosevelt and the Ritz-Carlton will see their property taxes halved.

All are owned by national hotel management groups, suggesting that any tax savings will head to corporate coffers outside of the city.

In order to pay for this roughly $42 million tax cut gift to mega-landlords and out of town corporate interests, we will ask  residents - that is homeowners and renters combined since residential tax increases are always passed on to renters - to  pay about $30 million a year more, collectively.

Overall it means at least a $12 million drop in annual revenue to the city and public services that depend on property taxes.  And, of course, the poorer you are, the more likely it is you rely on such services or cannot easily pay to make up the difference if they are diminished.  

How does this happen? Who would push a disaster capitalism scheme like this on an already hard-hit city?  The same people who have been robbing that city blind since Katrina, of course. They are the pros at this, after all. 

Michael Sherman, a lawyer who was land-use adviser to Mayor Mitch Landrieu and whose current clients include 30 hotel owners, was among the industry representatives who consulted with Williams on the tax changes. Sherman pointed out that Williams had the authority to make the big cuts for commercial property owners because of a revision to a flood-damage law that came into effect after Hurricane Katrina. It required assessors to consider tax cuts after various types of disasters.

Who won the pandemic? The bosses won the pandemic. The landlords won the pandemic.  The same grifters who step in after every disaster to strip the broken pieces of the social contract for parts won the pandemic. But you can't say we didn't know it would be like this.  We've gotten pretty well used to it by now.

The Erroll Exemption

Williams says we don't assess businesses for the cost of labor and equipment installation when calculating their tax liability. Unless we do.

Faithless assessors

Erroll Williams says his office has a great deal of discrepancy to determine whether or not large industrial concerns like Folgers need to pay their "fair share" (to use the current term of art.)  City Council is trying to nudge him a bit on this and he's nudging back.

The resolution was announced last week, the day after The Lens published a report about potential defects in Orleans Parish Assessor Erroll Williams’ process for tracking the exemptions. There are at least two properties — owned by Folgers and worth a combined $40 million — that were exempted by the assessor in 2018 and 2019, even though the exemptions expired in 2017. A request to renew the exemptions was denied by the state last year and again in February, but Williams did not take action to confirm that the exemptions were invalid until August, after more than a month of questions from Councilwoman Helena Moreno.

The resolution also calls for Williams to formally develop and adopt a written policy to monitor the industrial tax exemptions. And it asks for an annual report from the assessor on “all tax incentive policies, procedures, projects, and exemption status.”

Moreno said that the council can’t force Williams to comply because his office is a state-created agency and he is an independent elected official.

“This resolution merely urges the assessor to comply,” Moreno said at the meeting. “He is not part of a city agency therefore we can’t force him to do this, but were hoping just out of respect for the public he’ll comply.”

While Williams said he may honor some of the requests, he said he would not comply with the request for a written policy for tracking the tax exemptions.

“They’re not going to get that,” he said. “That’s none of their business. That’s an internal policy.”

Meanwhile, Williams is telling us via a message posted at his website, that questions of whether or not property taxes that affect individual homeowners and renters are completely out of his hands. Williams writes,

The only way your property taxes will increase is if any of the taxing authorities which levy property taxes (millages) raise their tax rates before the end of this calendar year. The taxing authorities CANNOT raise your property taxes unless they hold a public hearing and pass an increase with a 2/3 majority vote. Some of these taxing authorities have already scheduled public meetings to consider this increase but have not specified how they will use these additional funds.

Be aware: ALL these agencies must by law advertise the dates, times and places of meetings to consider a proposed property tax increase (or millage roll forward).

This statement is not exactly true. It is true that the various taxing authorities are required to automatically roll back their millage rate such that they remain revenue neutral or roll the rate forward by a public vote to capture the windfall created this year when Williams's office drastically increased property assessments all over town. However, even if a board decides not to roll forward, this doesn't necessarily mean each individual property's tax bill remains the same. You may find yourself paying more in taxes solely because your assessment increased as long as the overall revenue collected is static.

In other words, while the roll forwards will certainly make the problem worse, taxes are going up regardless because Erroll Williams has observed the overheated, speculative real estate currently driving New Orleanians out of their homes and written it into the tax rolls. He says that he doesn't have any choice but that isn't what he says about his prerogative to protect tax exemptions illegally extended to mega-corporations. It seems the question of what the assessor does or does not have the power to do depends mostly on who benefits from his actions. If this is the case, maybe we need an assessor who makes different choices about whom to serve.

Several years ago, a group of middle class reformers launched an agit-prop campaign to consolidate New Orleans's seven assessors offices into one.  The idea was to run a slate of candidates on something called an "I.Q." ticket.  The I.Q. stood for "I Quit" which was precisely what each of the candidates proposed to do should they capture the offices the group deemed unnecessary.  It didn't quite work out that way but the goal of consolidating the assessors offices was eventually implemented.

Imagine if a candidate ran for assessor now promising not to jack up property assessments so long as that action only accelerates the already out of control process of gentrification and displacement. Call it the Faithless Assessor campaign. Could that get any traction, you think?  Anyway, if anybody wants to give this a try my fee is one million dollars.

Municipocalypse 2019: The final STR shitshow

Well it is early August now and the first thing I gotta say is it looks like we may have picked the wrong week to stop taking kratom.  There's so much going on all of a sudden! For those of us accustomed to a long summer's nap this is very jarring. Seriously, how is it football season again already? We haven't even gotten to see the Commissioner's deposition over the NFC Championship debacle and somehow we're already doing the 2019 fake games and everything.

That is to say we will be doing that  Friday if we first survive what could be the most intense City Council meeting of the year on Thursday. Expect a full day shout-a-thon. Public commenters may, in fact, be lining up even as I type this. The reason for that, in a word, is gentrification.

Property values across New Orleans jumped by more than 18% in the last four years, an increase that is expected to result in a sharp rise in property taxes for many residents, according to preliminary estimates from the city's assessor.

The jump is far larger than has been seen in years in New Orleans as the spread of gentrification has caused prices to rise both in the already expensive historic core of the city and in more outlying areas that had remained relatively affordable until recently.

Mayor Cantrell took care this month to make sure nobody blames her for the rise in assessments. For example, during this video session, Cantrell urged us to complain to assessor Erroll Williams's office and not hers.  "It’s not us doing something to you,” she says. But that isn't really true.  In fact, her office is expected to ask City Council to for a millage roll forward in order to maximize revenue windfalls from the new assessments. That is apparently on top of a proposed new tax of 3 mils.

Chief Administration Office Gilbert Montaño has suggested the city would be looking to roll its property tax rates forward, arguing that New Orleans’ budget is about $100 million short of what it should be to meet the city’s needs.

In addition, the mayor’s office and council are currently sparring over a 3-mill tax proposed by the administration. Council members, in part responding to complaints from residents who have already received their notices of higher assessments, have sought restrictions on how that money could be spent, arguing that they could not ask residents to pay even more unless the money was specifically dedicated to infrastructure.

Administration officials argue they need to have flexibility to deal with unforeseen future needs.

Now before we get too far with this, we should probably emphasize that we here at the Yellow Blog are sufficiently orthodox in our socialism to understand the importance of funding essential government services. We also recognize the relatively progressive approach of a property tax as compared to, say, fines and fees generated by hyper-aggressive policing.  But the tax burden in New Orleans still falls disproportionately on poor and working class people and jacking up the millage is not going to repair that discrepancy.  The higher assessments combined with higher tax rates are almost certain to push poorer homeowners to cash out and move likely leading to further concentration of wealth in the city overall. Renters are also likely to suffer as higher taxes are passed on to them by landlords and fewer rental properties are available at affordable prices. This is what the mayor's 3 mil tax is doing to you.

Meanwhile, the mayor isn't exactly doing anything  for you either. LaToya swears assessments are "not her job." But she does consider it her job to push for millions of dollars in tax breaks and "incentives" to hand out to wealthy real estate developers who build more nice things for rich people.  All of which ultimately leads, again, to higher assessments, higher rents, higher taxes. The cycle (vicious or virtuous depending on which side of the wealth divide you find yourself on) keeps driving property values higher until you've got block after block of attractive speculative assets where nobody actually lives.

NEW ORLEANS — Tandra Smith has been living in her Fairgrounds neighborhood home since 2008.

"A lot of my neighbors have been here longer than I have," Smith said. She said she likes the area, mainly for its affordability, but after seeing her recent property assessment skyrocket she fears she won't be able to live here much longer.

She said her assessment last year valued her property and home at $167,000, which she said was reasonable because she purchased her home at $135,000. This year's assessment, which by law has to happen at least once every four years, put her house value at $416,000.

“I wanted to cry,” Smith said. do  

There are several factors pumping gas into this speculative bubble. But the one thing New Orleanians have been most loudly asking their elected representatives to do that could take some of the air out is get a handle on the explosive growth of short term rentals.

Robinson says it's something that's effected everyone on her street.

“So last year I paid one rate, and this year it’s a full 100% higher," she said. "The remaining six neighbors on this block, yes, there are only six of us left, theirs have gone up 300-450% higher.”

Ask her why, and she has one answer

"I believe 45% of the homes here in Treme are AirBnBs or Short Term Houses," she said. “That’s a business, but technically that’s a residence. So now we’re comparing their property taxes to my property taxes.”

City Council is planning to take up the short term rental ordinances this Thursday.  As a courtesy to all of us who enjoy a long and rancorous meeting, they have also wisely punted the property millage question that very same date. Expect a total shitshow of confused rhetoric. No doubt there will be landlords arguing in favor of more STRs in order to compensate for the rising taxes.  Also expect to hear that we need to hold the property taxes down specifically so that we can impose more fees on STRs. But these are false choices. Councilmembers can choose to protect people from rising housing costs without playing the drivers of those costs off against one another.  It's not at all clear that they understand this, unfortunately.

For example, here is Jay Banks saying some troubling things to WWLTV just a couple weeks ago. Talking about STRs, in particular, Banks says they "allow regular people to participate in this tourism economy."  By regular people, we have to assume he means individual landlords holding single properties.  But that is a gross misapprehension of the STR landscape in New Orleans. A report published by Jane Place last year showed that the bulk of the business is controlled by a handful of international corporations.

JPNSI found that 18 percent of all operators control roughly half of all STRs in New Orleans. Gambit’s recent review of licenses issued by the city found the top 10 operators - including Sonder, Hosteeva and Stay Alfred - hold more than 400 licenses, with several operators holding several listings per license; JPNSI says those top 10 operators have 568 listings.

Since then, that situation has almost certainly gotten worse. More to the point, though, there's no way Jay Banks wouldn't have been made aware of the data by now. But here he is pretending otherwise and saying defeatist things like, "we can't put this genie back in the bottle" and  "we've got to come to a happy median somewhere." Uh oh.

Similarly confused, or at least saying similarly confusing things is Mayor Cantrell. It's been difficult to pin her down on the specific ordinances being considered this week. But the comments she has made lead us to suspect she's not especially sympathetic. Just last Tuesday, councilmembers expressed frustration with the mayor's lack of commitment to enforcement. Even under the current overly liberal rules, there are an estimated 5,000 or so STRs operating illegally. But the mayor's staff are reluctant to do anything about that because of a circular argument I'm not even sure they understand.

The mayor’s representatives, however, said they could not bring on new staff until they figure out how stricter rules on Airbnb and HomeAway rentals would affect the amount the city now brings in from taxes on short-term rentals, whether they’re operating legally or not.

“We have to be careful about what we’re greenlighting to see how the market reacts to these issues,” said Gilbert Montaño, Cantrell’s chief administrative officer. He said uncertainty about how much will be brought in once short-term rentals are curtailed makes it “vitally prudent to hold off on hiring $2 million” worth of new staffers.

I think what  Montaño is saying is they are waiting for "the market" to decide what the law actually is. So that's encouraging.

That same day, LaToya was interviewed by Norman Robinson for a WLAE show called "Housing Matters"  primarily to promote the city's having landed $28 million in new grants and tax credits with which to "incentivize" the creation of new housing.  Cantrell doesn't always do a great job of explaining things. She mentions various applications for the grant money; soft second mortgage programs, home repair grants (probably distributed via non-profit partners) and, of course developer incentives. To the extent that money trickling down through those infamously sticky pipes is helpful, it's still mostly about chipping away at the symptoms of the housing crisis without really getting at the causes. Of course, there's only so much $28 million can do.  But for the sake of perspective, it's estimated that at best we're talking about 620-640 added "affordable units."  Currently the Greater New Orleans Housing Alliance estimates we need upwards of 30,000 to adequately address the need.

Norman also asked Cantrell to speak about East New Orleans in particular which led to some more confusing double talk.  The mayor was naturally eager to show that she wants the often neglected East to benefit from the new pile of money. But her choice of phrase, "New Orleans East is somewhere we want to push people towards" with regard to housing is ominous.

Generally speaking, the mayor's philosophy with regard to housing policy is neoliberal in the extreme.She even ducks a question about the demolition of the Big Four housing projects after Katrina choosing instead to fixate on a right wing policy paper about the 2008 financial collapse which she connects to a drying up of the state and federal "incentive" pipeline she prefers to just about any other possible solution.  What's worse, Cantrell is not at all convinced that STRs are a serious problem.  She sort of admits that they "don't help," but continually brings the conversation back to the need to find "balance" with the tourism industry in light of the fact that New Orleans is "a destination city."

So LaToya doesn't want to talk about it. But we should probably take a moment to explain what the City Council will actually be debating at this meeting.  We'll try to keep it simple.

Kristin Palmer has introduced a set of ordinances based on the most recent round of Planning Commission recommendations which would create two basic sets of rules. In residential zones STRs will be restricted only to properties whose owner also claims a homestead exemption there. The intent is to effectively outlaw the so-called "whole home" short term rental on any residentially zoned property.  In commercial or mixed-use zones, the ordinance would limit owners of large apartment buildings to convert only 25 percent of available units to STR while also requiring a 1-1 affordable unit match.

But that was before a consultant's report came back at the end of July and argued against the affordable match and 25 percent cap.  Essentially, their recommendation was for no restrictions on commercial STRs whatsoever. That seemed pretty shocking at first. But after The Lens pointed out the consulting firm, HR&A had some pretty glaring conflicts of interest, it started to make more sense.

The real estate consulting company that wrote the report, HR&A Associates, has worked for Airbnb at least four times since 2012, producing glowing reports about its local economic benefits and job creation bonafides. Most recently in 2017, the company produced “Sharing for a Stronger New York” on behalf of Airbnb.

HR&A responded a few days later but even if we take their argument in good faith, it doesn't add up. The problem begins with the treatment of the commercial and mixed use zoned properties as though it occurs in a wholly separate universe what happens in "residential areas."

HR&A says the scope of their report was to focus on the commercial zones only. But this is really a warping of perspective.  In practice, commercially zoned properties are a necessary component of any residential area. The corner grocery, the neighborhood bar, the hardware store, the gas station, laundromat, etc. these are all part of what makes a neighborhood a neighborhood. Here is the city's land use map.  If you look around at the zoning, you can see commercial properties running through the city along transit corridors or highly trafficked areas, or just occasionally on a corner lot maybe. So allowing unlimited STRs  to proliferate in commercial or "mixed use" zones doesn't protect these neighborhoods at all. It aggressively disrupts them.

We could see every affordable housing unit along a major transit line turned into an STR. This, in turn, will cause businesses along these commercial corridors; Magazine Street, St. Bernard Ave., Oretha Castle Haley, etc., to cater primarily to visitors rather than residents with further negative ramifications for the surrounding areas. Land use policy is supposed to be about managing an interdependent urban system. HR&A is structuring an argument that treats the different zones as if they exist as completely independent municipalities.   It's a deliberate obfuscation to tell us a tale of two cities where in fact there is only one.


The second thing HR&A wants to tell us is that we need to maximize STR proliferation in the commercial zones because that will, through a series of bank shots and hypothetical fees and plans that do not exist yet, generate money for "affordable housing" at some point.

But Phillip Kash, the lead author on the study, said the study’s recommendation to promote affordable housing primarily by imposing fees on such commercial short-term rentals would give the city the most bang for the buck.

“We came at it with the (idea) that the goal was to generate the most subsidized units or the most money for affordable housing,” Kash said this week. “We thought there was consensus on that point; now I hear there is less consensus on that point.”

But what that means in practice is sacrificing every commercial and mixed use corridor to tourist hosting and services. It means we are leaving the entire "historic" or "high ground" portions of the city (and then some) vulnerable to accelerated gentrification.

Meanwhile, the affordable housing hasn't been built yet. Remember, LaToya wants to filter the funds HR&A says we're going to generate back down through a series of developer incentives and bank loans in order to build a number of housing units woefully insufficient to meet the city's need.  Plus, once that even happens, because we have willingly failed to protect our core neighborhoods, whatever newly affordable housing we create will inevitably be cited in further flung and lower elevated neighborhoods. In other words, residents are displaced to less desirable areas. Perhaps New Orleans East where the mayor has already said she wants to "push people."

Unfortunately the study, flawed and corrupt as it may be, appears to have had some impact on the policy direction. On Wednesday evening even Palmer appeared to have given up on the one-to-one affordable match for commercial properties.  And the 25% cap also could be in serious trouble if Jason Williams decides to move on it.

Gisleson Palmer’s team said there will likely be several amendments, mostly technical updates, but they don’t expect a lot of push back. Except for one: A proposal to remove the 25 percent cap on short-term rentals in large scale commercial buildings in the CBD.

“That basically means you could take an entire apartment complex building and turn it into a short-term rental, a de facto hotel, which would basically kill the residential life within the CBD,” Gisleson Palmer said.

Council members said Jason Williams is the main author behind the amendment, but his staff told FOX 8 he’s still debating on whether to propose it.

He very well may do it. Remember Jason already has a handshake agreement with Sonder and Mike Motwani to convert a building near the foot of Canal Street into a de-facto STR hotel.  Because God forbid our tourist facing downtown corridor ever go "under-retailed." Not when Pottery Barn is right there waiting.

Peter Bowen, Sonder New Orleans’ general manager, said he hopes to have the three projects up and operating within three years.

On Monday, City Council President Jason Williams expressed optimism that Sonder’s approach would help efforts to bring more big-box retailers, such as an Apple store or Pottery Barn, to Canal.

“New Orleans is significantly under-retailed, but it’s not because we don’t have people with resources who want to spend money,” he said. “It’s because of our lack of investment over a period of time.”

On the other hand, maybe he will back down. If so, the result might not be too bad.  The match can be revisited later and the cap is a good enough imperfect place to start.  One thing is for sure. There will be a lot of yelling and speechifying between now and the time that we arrive at that place.

Save our city! New Orleans has become an increasingly unaffordable place to live as housing gets turned into Short Term Rentals by greedy, primarily out-of-state hypercapitalists. Make your voice heard at City Hall during the hearing on potential STR laws Thursday morning! pic.twitter.com/z5sZJCQW8x

— New Orleans DSA (@NewOrleansDSA) August 7, 2019