The years-long money fight between New Orleans City Hall and the Orleans Parish School Board may finally be heading for a truce. On Tuesday, the school board is set to consider a proposed settlement that could close out a bitter legal battle over how the city collects and spends school tax revenue. The board has called a special meeting with a single executive-session agenda item, and City Hall has scheduled a joint news conference to follow. If approved, the deal would resolve litigation that stems from the board's 2019 lawsuit.
The OPSB agenda recommends that members sign off on a settlement advised by the board's legal team, and the city is slated to brief reporters at 2:30 p.m., according to WDSU. Neither board counsel nor city officials have disclosed the settlement terms ahead of the closed-door session, keeping everyone else guessing until the public vote.
A years-long fight over tax collections
The dispute traces back to 2018, when the school board first flagged problems with how the city was handling school millage revenue. In 2019, OPSB sued, alleging the city was skimming a cut of property-tax dollars that were supposed to go directly to schools. For a brief moment in November 2024, it looked like the war might be over: a proposed deal on Nov. 18, 2024 included $20 million in near-term cash and $70 million in longer-term commitments. That agreement later fell apart under the previous administration, as reported by The Lens, leaving district leaders scrambling to plug a multi-million-dollar hole while the lawsuit rolled on.
Judge's ruling and budget pressure
In March 2025, a judge tossed out most of that larger settlement but still ordered the city to pay $10 million that had already been built into the municipal budget, a ruling detailed by WWNO. The court found the November agreement had never been fully finalized, yet the budgeted money remained owed to the schools, giving the district a narrow but important win.
School officials have long argued that the city's 2% collection fee has cost schools more than $10 million a year, and clawing back those dollars has been a central sticking point in negotiations. With budgets already tight, every percentage point in collection costs becomes a political and financial flashpoint.
What to watch Tuesday
The public agenda lists only an executive session on the pending lawsuit, along with a recommendation that the board approve the settlement when it returns to open session, according to Fox 8. The station reports that OPSB attorney Bill Aaron declined to comment on the terms, while the New Orleans City Council is scheduled to meet later this week, a step that could be required if council actions or budget adjustments are part of the package.
If the board votes yes, city and school leaders plan a joint announcement at the scheduled briefing, suggesting both sides are ready to claim at least a partial victory once the ink is dry.
What a settlement would mean
If OPSB signs off, the lawsuit would likely be dismissed and both one-time and recurring dollars could start flowing to schools and charter operators, helping to cover immediate shortfalls and longer-term funding gaps. The Lens previously outlined how the 2024 proposal would have redirected a slice of city millage revenue to schools and combined an upfront cash boost with programmatic commitments designed to soften cuts and restore some financial stability.
Officials have cautioned that the real impact will hinge on basic but crucial details: how much of the money is recurring versus one-time, and how quickly any new funds can move from city accounts into actual classrooms and programs.
Board members, parents and charter leaders will be watching Tuesday's vote and the city briefing closely for specifics on timing and allocation. This story will be updated after the news conference and the board's public action.
