On Tuesday, Sept. 14th, after having read — once again — the city’s claim that at least two-thirds of New Orleans had had at least one round of trash pick-up since Hurricane Ida, we decided to see if we could independently verify that claim. To our eyes and noses, two-thirds sounded overinflated. We live in the Upper Ninth Ward just a few blocks from each other and thought maybe just our section of the city was getting passed over.
We decided to create a survey.
In five days, the survey garnered more than 1,300 responses. The results were clear and unequivocal: more than 60% of the city reported no pickup at all since Ida. There are important questions to be asked about where the city’s two-thirds number came from; why it was continually repeated; and how the performance of its contractors is verified. Those questions need to be asked. But the more pressing questions are: how did we find ourselves in this trash heap; how do we get out of it; and how do we keep this from happening again?
Our survey found that more than 70% of the people who reported no trash pick-up since Hurricane Ida reside in a swath of the city designated as Service Area 2. Metro Service Group serves that area. Service Area 2 covers neighborhoods downriver of Esplanade Avenue and east of Wisner Boulevard. Even though Service Area 2 has seen the worst service, many residents across Service Area 1, which is served by Richard’s Disposal and covers Uptown, Mid-City and the West Bank, had yet to see their trash picked up, either.
As early as two days before Hurricane Ida, Mayor Cantrell indicated that the city knew Service Area 2 would have a problem. She told residents they would not have to rely on Metro Service Group for trash pick-up after the hurricane, especially since the company struggled with labor shortages before the storm.
In market economies, the price for goods and services often rises and falls in relationship to supply and demand. And waste management workers are in demand. So hoppers and drivers can command more for their labor within the sanitation sector, its adjacent industries and the broader market. The result is upward pressure on Metro, who is unwilling to offer competitive wages for a service necessary to honor its contract and bid.
Metro Service Group seems to be either hoping for a bailout from New Orleans taxpayers or, perhaps, the magical reappearance of a nonunionized labor force, unable to negotiate. A lawyer for Metro Service Group told the City Council that shifts in the labor market were “not factored into the bid at the outset. Otherwise, they shouldn’t apply to this contract, because you can’t add additional costs without providing some additional revenues to cover that.” Metro’s lawyer seems to be suggesting that the company’s failure in financial forecasting is the problem of the city and its residents. The position implies that the city signed a contract which guaranteed a certain profit margin, rather than a contract to collect certain amounts of trash from certain parts of the city on certain schedules. Metro Service Group gets an A for effort, but an F in economics.
Across the economy, there is no labor shortage for businesses willing to pay competitive wages. If a business’s margins are so dependent on such a low price for labor that it can’t compete, well, to borrow a phrase from Milton Friedman, that’s “the business of business.” In this case, Metro Service Group and Richards’s Disposal contractually agreed to deliver services in exchange for a specific payment. If it ends up costing them more money to honor their contracts, then, from a business perspective, they miscalculated the cost of delivering those services. But they are still required to honor their contract — even if it means they lose money. Reluctance to cut into profits and unwillingness to pay market rates for labor are not excuses for contract infringement.
Metro Service Group, in particular, has demonstrated an ongoing unwillingness to provide just compensation for its employees. In 2019, the trash hauler settled a federal labor case with its sanitation workers for multiple instances of repeatedly violating federal minimum wage laws. When faced with an organizing effort by its hoppers in the spring of 2020, the company brought in prison labor. They allegedly denied their workers the democratic right to form a union through threats and coercive acts. (A complaint against Metro and its staffing services contractor People Ready filed with the National Labor Relations Board was dismissed in December. The NLRB found that after first telling striking workers they were fired, the companies distributed a letter to them affirming their right to organize and telling them they could come back to work after the strike.)
These companies need to be held accountable in every way possible. They should receive fines for every missed pick-up; and there should be a required review of GPS truck data to gauge the scale of any non-compliance. That would help to recoup as much money for customers and the city as possible. The city must make it patently clear to Metro, Richard’s and any other firm in non-compliance of a city contract, that it will cost more not to pay prevailing wages than it will to pay them.
Mayor Cantrell has repeatedly indicated an unwillingness to hold Metro Service Group to the terms of its contract. Since 2012, she has received at least $5,000 in donations from Metro CEO Jimmie Woods, a relatively paltry sum in the scheme of Woods’ political donations, which also included a $5,000 donation to her main opponent in the 2017 mayoral race.
The long-term answer is not to rebid contracts or bring in other sanitation firms. Rather, the city of New Orleans needs to get back into the trash collection business as soon as possible. As soon as these contracts end — ideally because of termination for non-compliance — garbage collection must return to being a public good just like firefighting and public libraries. Municipally owned trash collection systems have numerous advantages over our current system. They can be held accountable to our representatives and to voters.
At the end of the 19th Century, cities began to provide garbage collection as a city-run service. Streets without festering trash became an important public health asset for citizens and a symbol of good government. The failure to successfully remove garbage led to the downfall of many city administrations. In the 1980s and 1990s, many places — including New Orleans — began to outsource trash collection to private contractors. The result is a system where the city has hired three private companies to dispose of household waste.
Like our fire department, municipal garbage collection is not operated for profit. It is solely devoted to serving all residents. Municipal sanitation systems can be run internally with efficiency and high levels of public satisfaction like our libraries, our parks and recreation centers, and our fire department. City-run sanitation departments can easily and effectively pivot to deal with situations like our current one.
As city workers, hoppers and drivers will be essential personnel entitled to things like emergency housing in the event of another hurricane, allowing for speedier returns to work and quicker removal of waste, a public health hazard. And it’s cost effective. In San Antonio, which has a municipal garbage collection system, residents pay seven dollars less per month for more services than we receive. More importantly, under a municipal system, the hoppers and drivers who literally do our city’s dirtiest work will be entitled to all the competitive wages, benefits, safety equipment, and workplace rights of other city employees.
The current administration effectively made the point when it brought in city workers to help Metro pick-up trash in its service area. The city’s action made it clear that because of its wages and benefits, it has no such labor shortage. The city’s Operation Mardi Gras revealed a simple fact: the public health and quality of life issues that come from a failure to collect garbage, along with the well-being and security of these most essential of workers, are too important to be trusted to contractors. We agree!
Given the uproar, the candidates who seize this issue; demand that these contracts be honored immediately; and call for municipalized garbage pick-up in the future — no matter the cost to politically connected contractors — are likely to find themselves in a position to deliver on their promises. It’s up to the rest of us to remember this moment and to make a stink to ensure that our leaders do, too.
Thomas J. Adams is a Visiting Professor at Tulane University’s New Orleans Center for the Gulf South. Suzanne-Juliette Mobley is the Director of Research at Monument Lab.