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Local charities, leaders discuss potential impact of fiscal cliff

Despite talk out of Washington of a tentative deal in talks to avert the so-called "fiscal cliff", there is continued worry here in the New Orleans area about what deep federal budget cuts and tax increases might mean on the local level.

The homeless come and go from the New Orleans Mission as donors stop by to give what they can.  "They're vital, that's how we exist -- we don't get a dime from the government," said mission assistant Claire Kay of such donations.

It costs over $2,000 a day to care for nearly 250 homeless people at the mission. All of it comes from private donations. That's discretionary spending -- which would likely decline if massive tax increases kick in.

Kay said, "We are extremely worried.  We desperately need the corporate sponsors.  It costs us $60,000 a month -- we couldn't make payroll.'

The New Orleans Mission has had a tough time since Katrina.  Before the storm, the mission had 28,000 donors.  Today, they only have about 8,000, making private donations more critical than ever.

This shelter is more vital to the city's homeless than ever, since efforts were beefed up to clear them out from under the expressway two months ago.  "We took on 35 new people a day. We have 244 living on site," Kay said.

It's not just charitable groups who worry about donations going down.  Local governments say their tax revenues have already suffered, due to consumers' concerns about the future.

"That affected our Christmas season," said Jefferson Parish President John Young.  "It was one of the worst retail-wise since 2008."

For state and local governments, there's much more at stake than just declining tax revenues.

Mandatory tax cuts could cost Orleans Parish over $12.4 million in federal community block grant money.  Jefferson Parish could lose $2.5 million.

It appears as if the talks are bearing fruit.  Senator Mary Landrieu (D-La.) said, "Democrats have put $1.5 trillion in spending cuts in place; we are lacking someone on the other side to put revenues on the table."

But until a deal is done, few will rest easy.

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