The Orleans Parish School Board moved Tuesday to end a yearslong fight with the city of New Orleans over school funding, voting 6-1 to accept an agreement that settles a 2019 lawsuit the district had filed against the city.
Board officials said the dispute centered on how the city handled tax collection fees and other money flows related to the Orleans Parish School Board, arguing those arrangements diverted funds away from schools and toward municipal uses.
Under the settlement, the city will lower collection fees for sales taxes and eliminate them for property taxes, changes district lawyers argued were illegal under the original lawsuit. Board leaders also said the city would stop what they described as skimming funding meant for the school board to fund pension obligations.
Beginning next year, the city will reduce the fee it charges to collect sales taxes on the school board’s behalf from 1.6% to 1.5%, board vice president Olin Parker said. Parker also said the agreement would save an estimated $150 per student every year, according to the district’s calculations presented at the board meeting.
The settlement additionally calls for Orleans Parish School Board to receive $4 million every year in lease payments from Caesar’s Casino New Orleans starting in 2030 and continuing for as long as the lease exists. Parker said the casino fund would help support initiatives that address chronic absenteeism and provide funding for the Travis Hill School, which educates incarcerated children.
Parker described the settlement as a way to protect funding streams he said must endure, telling reporters, “The students are at the forefront of our minds,” and adding, “Protection of those fees in perpetuity is protection for the most vulnerable students in our district.”
In the broader financial terms of the deal, the settlement also includes payments to the NOLA Public School district. The city will pay $6 million by the end of 2027, and beginning in 2027 it will pay $2 million annually over the next 15 years, totaling $36 million, according to the board agreement described in the reports. The money is expected to go into the district’s fund balance and not directly affect the funds flowing into schools, board officials said, describing it as part of correcting costs the district incurred after a financial miscalculation that led to a $50 million deficit in 2024.
School board president Leila Eames said the settlement addressed major funding concerns, describing the city as financially constrained. “The city is broke — they’re having their own issues to deal with,” Eames said, adding, “Lets be grateful, lets be joyful, and lets celebrate.”
The city, for its part, said it expects the agreement to hold. Mayor Helena Moreno, speaking at a Tuesday press conference announcing the successful deal, said the council, the mayor’s office and the school board were aligned and that the arrangement would not fall through as it had last year, when she said an earlier settlement effort collapsed after the Cantrell administration.
Moreno said the settlement reflects what the city can afford while giving the school board what it needs, and she pointed to the earlier negotiated agreement during the Cantrell administration that she said “pretty much fell apart,” adding, “But we all vowed that we would be back.”
Not every board member backed the agreement, however. KaTrina Chantelle Griffin cast the only “no” vote, saying the settlement did not provide the school board all of what it was owed through the original lawsuit, while Nolan Marshall said the deal was positive but not perfect. Marshall said, “Fees will not be collected for anything that’s not codified anymore, period, going forward into perpetuity,” adding, “We will never be in this position again. That’s the agreement we have with the city. So that is a great deal.”
The school board and city leaders described the settlement as part of a response to ongoing fiscal pressures facing the district, including declining enrollment and deficits. Officials from charter operators, including Sabrina Pence of FirstLine Schools, also described the deal as protecting funding over time, saying it would shield children’s education “for a long, long time.”
The settlement still must proceed through additional steps before it is finalized. It requires a City Council vote, and it will not be finalized until a judge signs off, with the mayor’s office holding the press conference Tuesday and the City Council scheduled to vote Thursday.