The contracts to collect solid waste from New Orleans homes and businesses are among the most lucrative the city has to offer. Those companies with the equipment and financial resources to compete for these contracts are willing to do whatever it takes to win. The current garbage collection dilemma in New Orleans is all about politics and money – who wants it, who has it and the citizens who are going to pay more every month.
Why have New Orleans residents been suffering with poor quality pick up? Naturally, citizens want to blame Jimmie Woods of Metro Services or even Alvin Richard of Richard’s Disposal. The real culprit in the garbage crisis is Mayor LaToya Cantrell who seems to have it out for two highly respected Black business leaders.
For decades New Orleans garbage was picked up exclusively by white owned companies until Richards was able to work his way in as a small subcontractor to the national hauler Waste Management, the city’s prime contractor for many years. Woods and his brother Glenn had also started a disposal company making pick-ups with only one small truck at first. One brother would drive and the other brother would scoop up the trash. Eventually, Woods also became a subcontractor with Waste Management taking a large overhead fee.
Mayor Ray Nagin wanted to change that equation and build generational wealth for the two minority- owned companies. He provided an opportunity for Richard and Woods to get the bigger portion of the pie. Soon the duo were sharing the main contract and had subcontractors of their own. Hurricane Katrina had already devastated the City’s budget. When Mayor Mitch Landrieu took over, he leaned on Woods and Richard to reduce their fees. Richards balked. Woods agreed. The new contract also failed to include a provision for additional compensation if and when the number of households in the service area increased.
Metro purchased new more energy-efficient equipment,expanded services to include construction and then bid on waste disposal contracts in other cities. At the same time, the number of households in Metro’s service area grew without additional compensation. Metro began to feel the squeeze that never let up.
Almost three years ago, the COVID-19 shutdown created a situation where citizens remained in their homes, ate all their meals at home and purchased items to make staying/working from home more enjoyable. At the same time, the amount of household garbage placed curbside increased. Many sanitation employees caught the virus or quit working altogether when federal unemployment funds became available. All sanitation companies – as well as many other industries – had trouble fulfilling their staffing requirements.
When Hurricane Ida struck in 2021, Mayor LaToya Cantrell made an unfortunate decision not to declare a mandatory evacuation. Everyday citizens had to fight to get compensation from their insurance carriers for evacuation expenses. But more important, federal funds did not kick in to compensate trash haulers for the extra loads they had to transport. Staffing shortages increased as the homes and apartments of some trash hauling employees were uninhabitable due to storm damage.Large amounts of storm debris needed to be picked up from front lawns and curbs.
Instead of providing additional compensation to existing trash contract holders, the City brought it outside contractors at premium prices. Metro was not able to properly manage the increased work load or provide better compensation to keep existing employees on the job. As word spread that Mayor Cantrell would re-bid Metro’s contract, more employees departed which only made Metro’s problems worse. The City continued to pressure Metro to perform under the terms of its existing contract without additional compensation for more households and trash to service. Chapter 11 Bankruptcy protection seemed to be the best answer for Metro.
Though many citizens applauded Cantrell’s decision to oust Metro, the new contracts will initially cost ratepayers an additional $6 million annually, far more than Metro was ever offered. Where will the $6 million come from? The city could divide those costs directly among ratepayers. Mayor Cantrell might utilize a lump sum from available federal dollars in 2023. If federal dollars are used, funding for other programs could be cut such as more affordable housing or recreation. Surely federal funds would not be available a second year. The Sanitation Department budget will never shrink. Rates will only go up in 2024 if not earlier.
Just over a year ago, the City called for a “temporary” reduction of waste pick-up to once- a-week in all neighborhoods except the French Quarter and the CBD/Warehouse District. The new contract promises more efficiency but does not return service to twice a week. How many readers are still going to be comfortable with once-a-week pickup six months from now when flies, roaches and maggots are breeding and rodents are teeming around over-stuffed cans? Even with the additional complimentary trash can the city will offer, insects and rodents and their accompanying health hazards won’t vanish. Whenever the public again demands twice-weekly collection, rates are sure to rise. Under Metro’s current contract, everything placed on the curb – furniture, appliances, etc. – was picked up. The new contractors will no longer collect bulky items. Citizens will have to personally pay to dispose of larger items.
The owners of Waste Pro and IV Waste are good trash haulers. They saw a fresh opportunity and went for it. As businessmen, they will not willingly absorb future cost increases which will negatively impact their bottom line. Expect to see them at the City Council for additional funding in budget year 2024.
With new 7-year signed contracts in place, Waste Pro and IV Waste are prepared to take over Metro’s routes on November 8 in Lakeview, Gentilly, New Orleans East and other downriver neighborhoods. U.S. Bankruptcy Judge Meredith Grabill has been assigned Metro’s case. She could uphold a stay order which would force the City to pay Metro’s $900,000 monthly fee while the case proceeds. The $900,000 will be just one more expense for citizens to absorb. Furthermore, the City Council has not indicated whether it will begin paying the new contractors next week as Cantrell has requested.
All these changes and additional millions in costs could have been avoided. Yet, Mayor Cantrell made a decision to select new trash haulers, as is her prerogative. Let’s hope that the citizens who pay for sanitation services will be able to absorb higher fees at the same time that Entergy and SWBNO bills increase. New efficient waste disposal services might smell good right now. But will they feel good in your wallet when rates inevitably rise?
