[StBernard] Upstart is low bidder for Quarter trash deal

[Westley Annis]

Upstart is low bidder for Quarter trash deal
Company has several St. Bernard contracts 
Sunday, November 26, 2006
By Michelle Krupa
and Karen Turni Bazile

Staff writers 

The lowest bidder for a lucrative deal to collect trash and clean streets in
the French Quarter and Central Business District has landed several large
public contracts in St. Bernard Parish since the company was formed nine
months ago by a developer and hotelier who is the son of an influential
Chalmette lawyer. 

SDT Waste & Debris Services of Chalmette bid $8.9 million a year for a
seven-year deal that Mayor Ray Nagin has hailed as a way to bring
"Disneylike" cleanliness to the city streets that visitors see most often. 

The contract, which city officials are expected to award this week, will
supplement a pair of deals, worth $27 million a year, awarded last month for
collecting trash across the rest of the city. 

SDT's president is Sidney Torres IV, son of a well-known class-action
attorney and grandson of longtime St. Bernard Court Clerk Lena Torres. 

Although the company's extensive proposal for the New Orleans job includes
several reference letters from public entities, the firm's work has raised
questions in St. Bernard, where it has contracts with the parish government,
the School Board and a firm that manages FEMA trailer parks, bid documents
show. 

Just last month, St. Bernard officials issued SDT a cease-and-desist order
after the company started building a transfer station, without permits and
in violation of zoning laws, near Paris Road in Chalmette. 

Even before the order was sent, however, Torres halted construction
voluntarily. He said Saturday that his lack of permits resulted from an
internal office foul-up. As for the zoning problem, he said he believed he
was not in violation of the law but is preparing to apply for a zoning
change. 

Also, some Parish Council members had complained they were not notified of
the bid process that landed SDT, the lower of two bidders, a six-month
garbage-collection contract that began in July. 

Members were miffed when Alan Abadie, executive counsel to St. Bernard
Parish President Henry "Junior" Rodriguez, told them early this month that
the deal had been extended for 12 months at the same price: about $3.5
million annually for collections at 7,500 homes plus several large trash
containers across the parish. 

The SDT contract in St. Bernard also has raised eyebrows for the same reason
critics have questioned three new trash-hauling deals, including the French
Quarter job, in New Orleans: The agreements are "per-unit" contracts,
meaning that as more residents return, the deals' value increases. 

In New Orleans, where the city pays for trash collection entirely from its
general operating budget, officials expect the cost increases to be offset
by returning residents' monthly sanitation fees and the additional sales and
property taxes they will pump into the general fund. 


Rising from storm 


According to its bid documents, SDT has worked since Hurricane Katrina for
the St. Bernard School Board; DynCorp International, which manages a trailer
park for employees of St. Bernard Sheriff Jack Stephens; Associated
Terminals of St. Bernard, which manages the Chalmette Slip for the St.
Bernard Port, Harbor and Terminal District; and the University of New
Orleans. It also has inked contracts with several private firms, including
Boh Bros. Construction Co. 

Torres said he signed the contracts with the school system and DynCorp
before he incorporated his disposal company. Those agreements, he said, were
made through a parent company called SDT Inc., which he formed in 1997. That
firm also employs Jeff McClain, the stepson of Rodriguez. Torres
incorporated the disposal firm in February, Louisiana secretary of state
records show. 

Torres is a longtime developer who in the months before Katrina had won
approval from the New Orleans City Council for a controversial condominium
project in Faubourg Marigny. He said he got into the debris business as a
matter of convenience and a desire to aid the recovery. 

"The Monday of the storm, I was going to start 70 condominiums," he said.
When that project was derailed, Torres said, he focused on his existing
properties. "I got my hotels up and running. I got here five or six days
after the storm and I started working. I put my crews together working on
building FEMA camps. 

"Prior to the storm we would have never had this opportunity." 


No service complaints 

Torres said most of his waste company's employees are former Waste
Management of Louisiana workers who lost their jobs after Katrina. He said
that if he gets the French Quarter contract, he has lined up a manager who
has more than two decades of experience in the local garbage-collection
industry. He would not name the prospective employee. 

As for the contract with the parish, St. Bernard Council Vice Chairman Joey
DiFatta said the council was never told that administrators had hired a new
trash collector and then extended the deal. 

"It would have been nice for us to know about it," he said. 

But with work well under way, and the deal now in place for 18 months,
DiFatta said he is pleased with it. 

"It is a good contract in our opinion. It's all brand-new equipment. We
haven't gotten any complaints," he said. The original deal was for six
months "because we expected them to come in with new and serviceable
equipment, (and) we wanted to give them an escape hatch in case they
couldn't make money." 

St. Bernard Chief Administrative Officer Dave Peralta said he did not handle
the bid process in July, but he thinks the parish needed to sign the
yearlong extension because officials were unlikely to get a better deal from
any other company that could be ready to roll in January. 

"Their service has been excellent," Peralta said. "I haven't fielded a
complaint yet." 


Other bids 

SDT appears to have narrowly won among three bidders for the right to
collect trash in the French Quarter, CBD and Warehouse District. The
second-lowest bidder was the Ramelli Group of New Orleans, which also was
formed in February and which bid $9.1 million for the project, records show.


Officials have not revealed whether any of the bids comply with all city
requirements. 

The slim cost difference between the two top bids boils down to the low
price SDT offered for providing semiautomated garbage collection, which
utilizes robotic arms to unload uniformly designed trash bins into garbage
trucks, bid documents show. 

The contract also includes street cleaning. 

Though both bids for the downtown deal nearly equal the $9.4 million the
city is paying Waste Management post-Katrina to pick up trash at homes and
small businesses citywide, the Nagin administration has touted the elevated
level of service the contract would require. 

Trash in the Quarter, CBD and Warehouse District would be picked up once or
twice daily, depending on the type of unit. Streets and sidewalks would be
swept mechanically once, three times or seven times each week, depending on
the block. And the vendor would face stiff fines for shoddy performance. 


No winners yet 


The contract would round out a pair of deals that Nagin awarded in early
October for twice-weekly collection of household waste across the rest of
the city. 

Those contracts, which also would terminate in 2013, are worth a combined
$26.8 million, bringing the total cost of garbage pickup in New Orleans to
nearly $36 million annually. That is double the annual cost of the Waste
Management deal before it was reduced last year to account for the city's
smaller population. 

Sanitation Director Veronica White told the City Council early this month
that she expected to choose a vendor for the French Quarter deal within a
week of the Nov. 17 bid opening. All three new contracts are slated to begin
Jan. 2, and Waste Management has said it plans to yank its employees and
equipment from the city's streets on that date. 

Mayoral spokeswoman Ceeon Quiett said Saturday, however, that a contractor
has not been selected. "It is too early in this process to estimate when
contracts will be awarded," she said. 

A third company, Unique Pressure Washing, bid only on the street-cleaning
portions of the downtown deal, including manual and mechanical sweeping of
streets and sidewalks, and street flushing. Though the bid from the eastern
New Orleans firm for those tasks came in at $1.1 million -- compared with
$3.9 million by Ramelli and $5.9 million by SDT, for the street cleaning
items only -- it is unclear whether the city is considering the bid. 


Sharing subcontractors 


Officials rejected a proposal from the New Orleans firm of TSG Solutions
Inc., which bid on a small portion of the contracts for trash collection in
all neighborhoods except the downtown areas. TSG bid only to collect garbage
from litter cans along public streets, leaving blank all other sections of
the bid worksheet, including trash-hauling in residential neighborhoods. 

Bid documents show that TSG's offer was cheaper than the bids for litter-can
collection offered by Richard's Disposal and Metro Disposal, which each won
a contract to collect trash across about half of the city, including the
litter-can services. 

In an unusual facet of the downtown bids, documents show that SDT and
Ramelli chose the same subcontractor -- Empire Janitorial Sales & Services,
a subsidiary of Nolmar Corp. of New Orleans -- to handle a major portion of
work under the deal. 

Nolmar, founded by businessman Nolan Marshall, came under fire several years
ago from the Orleans Parish School Board for what school officials said was
its shoddy performance as part of a joint venture with ServiceMaster. 

In 2003, a year after Nagin took office, the company was part of a team that
became the sole construction management firm for the New Orleans Aviation
Board after the board fired a second firm with strong ties to former Mayor
Marc Morial. 

For all three city sanitation contracts, the city has required the prime
contractors to create a 50 percent partnership with disadvantaged business
enterprises; Empire/Nolmar is a qualified DBE. The participation rate for
women- and minority-owned business partners in the Waste Management contract
has been lower. 

. . . . . . . 

Michelle Krupa can be reached at mkrupa at timespicayune.com or (504) 826-3312.
Karen Turni Bazile can be reached at kturni at timespicayune.com or (504)
826-3321.