Act #203 of the Louisiana legislature, passed on March 20, 1850, provided for the biennial election of six men to serve along with the Mayor as a board for the liquidation of the debts of the city and of its constituent municipalities. This Board of Liquidators was to determine, through examination of the city's fiscal officers, the total amount owed by the city and its three municipalities. The amount owed by the city prior to 1836 was to be apportioned among the municipalities on the basis of each body's share of the city's taxes for the year 1849. The share of each municipality so determined was to be added to that municipality's separate debt to determine the total debt of each.

The Board was authorized to issue bonds to be given in exchange for outstanding instruments of indebtedness. The Board assumed control of the assets of the General Sinking Fund and of whatever sinking funds had been established by the individual municipalities. All such funds were accordingly abolished.

The assets acquired from the sinking funds, along with a special tax levied by the Board, were to be used to for the payment of principal and interest on the city's bonds. Provision was also made for the payment of debts not converted into the new liquidation bonds.

This Board of Liquidators was superseded in 1852 by the newly established Commissioners of the Consolidated Debt of New Orleans. All assets and records of the Board were turned over to the Commissioners.