November 15, 2010
New Orleans, LA – Mayor Mitch Landrieu announced that the City of New Orleans successfully renegotiated a contract with Metro Disposal, Inc., one of the city’s sanitation collection contractors.
“This is a big win for New Orleans,” Landrieu stated. “The negotiations were guided by three core principles. First, I honored my fiduciary responsibility to get a good value for taxpayer dollars at a price the City can afford. Second, I honored my belief that government has an obligation to support local businesses. And third, I honored my commitment to good costumer service by providing curbside recycling, which we heard loud and clear, is a priority for our citizens.”
“On behalf of Metro Disposal Incorporated I am pleased to announce that we have been able to reach an agreement with the City of New Orleans which will allow us to continue serving this community,” said Jimmie Woods of Metro Disposal. “As good corporate citizens, we understand the financial challenges faced by our City and we have searched for ways to provide added value to the services we provide.”
Woods continued, “Thus, we are also pleased to announce that under this new arrangement we will re-introduce curbside recycling to our coverage area. The details of this new service will be rolled out over the next few weeks as we streamline the process for implementation. Like our slogan suggests, ‘Just another day … isn’t just another day at Metro. We have to prove ourselves every day,’ we are hopeful that the great citizens of this community will understand that we live by our creed.”
The key points of the agreement are as follows:
- $15.99 per household monthly, including curbside recycling;
- Metro and the City will collectively agree on a methodology for determining and monitoring the house count;
- By advanced mutual consent of the parties, Metro will receive only a one-year extension through December 31, 2014, to its current contract reducing the 3-year extension granted by the previous administration;
If this contract was not renegotiated or rebid, the city would have paid $18.15 per household without recycling in 2011 for Area 2.
Metro serves “Area 2” of the city (current house count 55,943), which includes New Orleans East, Lower 9th Ward, Gentilly, Lakeview, Faubourg Marigny, Bywater, Upper 9TH Ward, City Park, and Treme. Richard’s Disposal currently serves “Area 1” of the city (current house count 66,525), which includes Algiers, Uptown, Garden District, and Mid City.
In the midst of the City’s budget crisis, Metro is the latest in a long list of contracts renegotiated by the city. In August, the Landrieu administration successfully renegotiated the SDT Waste & Debris Services, LLC sanitation contract, saving the city $110,000 a month or $1.32 million annually.
In addition to the SDT contract, the Landrieu Administration has also renegotiated and cut millions from other contracts:
- Saved $11 million on its contract with MWH by building capacity internally
- Saved $2 million on contracted staff augmentation IT services
- Saved $450,000 by Law Department reducing outside counsel
- Saved $180,000 by utilizing volunteer hearing officers
- Saved $300,000 by cancelling Finance department audit contracts
- Saved $300,000 by reducing PFM’s consulting and Budgeting for Outcomes contract
- Saved $1 million by reducing the contract for basic street maintenance
- Saved $250,000 on contracts for tree trimming and grass cutting for Parks & Parkways
- Saved $100,000 by eliminating the City Hall Xerox copy center
On November 4, 2010, after more than four months of stalled negotiations, the City issued an invitation to bid for sanitation collection services in Area 1 (Richard’s) and Area 2 (Metro), in order to prevent a break in sanitation services for New Orleans residents.
After reaching an agreement with Metro, the City will withdraw its invitation to bid for Area 2. The City will still accept bids for Area 1, since an agreement with Richard’s has not been reached, and will amend it to include curbside recycling. Details on the amended bid will be available online and will be discussed at a pre-bid conference to be held on November 16, 2010, at 11am in the Purchasing Conference room at City Hall. Responses to the amended bid will be due December 6 at 11am.
The City Attorney communicated the city’s best and final offer to Richard’s Disposal through its attorney who had been negotiating with the City on behalf of both contractors for over four months. The proposal the City received from Richard’s was not responsive to the City’s best and final offer. The Landrieu Administration remains open to negotiations with Richards Disposal and hopes to reach a resolution that is satisfactory. If not, the City will proceed with the invitation to bid to prevent a break in trash pick up for residents in 2011.
