Car damaged in a pothole? The NOLA City Council is looking to create fund to pay judgements.

NEW ORLEANS — If your car’s tire or rim was damaged in a pothole on a public street in New Orleans, you can sue the city for the cost of the repair.  But if you win a judgement, just get in line to get paid.

According to Councilman Jason Williams, the city has a backlog of unpaid judgements totaling about $40 million dollars and dating back to 1996.  Williams wants to change that.  Car repairs are just one of many reasons the city gets sued and sometimes loses.

“This ordinance attempts to address the backlog in a way that we can bring it down over time and eventually be able to deal with it each year,” Williams told four other council members during the Budget Committee’s meeting on Thursday.

Here’s what Williams is suggesting.  He wants the city to take the money it receives from judgements it wins and use that to pay judgements it loses.  For budgetary purposes, Williams wants to put the number at $2 million a year, which he says is the near average total for judgements against the city in recent years.

In years that the judgements are less than $2 million, the left over money could be applied to past obligations.  In years when it’s not enough, the city could look at other ways to find the extra money.

Besides allocating money to pay the judgements, the proposed ordinance could have another affect, and Williams addressed it early in his explanation.

“If we can put this in place, we can attract that cottage industry,” he said.

The cottage industry he’s talking about is the practice of lawyers or other investors buying the judgements that people have for less than their full value.  It allows people who need the money to get it immediately, and the investors know that eventually — if the city is truly paying the judgements — they’ll get their money back plus profits.

The cottage industry portion of the equation is something that bothers councilwoman Stacy Head.

“I can list about 500 things that are more important than creating a cottage industry…” Head said.   She’s also wondering if the $2 million could be better spent on other things.

“Two million dollars is a lot of money.  It’s a lot of catch basins.  It’s a lot of early childhood development programs.  It’s a lot of basic needs,” she said.

Both Head and Williams are lawyers.

Williams said that the main benefit of the program is getting money to the people who deserve it.

The committee passed the proposed ordinance by a 3-2 vote.  Council members Williams, LaToya Cantrell, and Jared Brossett voted for it.  Head and Susan Guidry voted against it.  Guidry made it clear that, while she likes the idea of the city paying its obligations, she hadn’t had an opportunity to study the plan enough to support it.

Next, the full council will take up the matter.  Williams says he expects there to be amendments offered, and he is encouraging other council members to make suggestions that improve the plan.  Already, there was talk of including language that would allow the city to use the $2 million dollars for other uses if some sort of an emergency is declared.

If the proposal eventually becomes law, it would take affect for the 2018 budget.