Times-Picayune (New Orleans)
March 16, 2005 Wednesday
3rd place fits bill for N.O. contract;
Winning firm rated last, lacks experience
BYLINE: By Martha Carr, Staff writer
SECTION: NATIONAL; Pg. 1
LENGTH: 2734 words
Mayor Ray Nagin has awarded a politically active company with no experience in the criminal justice field a contract to create a home monitoring program for municipal offenders, a deal the Nagin administration says could save the city hundreds of thousands in jail costs this year alone.
The mayor passed over two higher-scoring bidders to award a one-year contract with five one-year extensions to Community Based Corrections LLC, a local, minority-owned company created in October 2003 by Burnell Moliere, Jimmie Woods and Ray Valdes. All three have close political ties to District Attorney Eddie Jordan and former Mayor Marc Morial.
A three-person selection committee gave Community Based Corrections the lowest score of the three qualifying bidders, city documents show. The company's price also was the highest, but the mayor allowed CBC to rework its proposal to bring costs more in line with the other two bids, records show.
The contract is capped at $3 million, but the value depends on how many offenders are ordered to enroll.
Neither of the two competing bidders, which included another local, minority-owned firm, was allowed to resubmit their proposals for the Municipal Court job.
The city did renegotiate, however, with minority-owned Total Sentencing Alternatives Program, which received the second highest score, to provide electronic monitoring in Criminal District Court under a separate contract. That contract has yet to be finalized.
Because the contracts are for professional services, Nagin is not required by law to select the lowest bidder.
While the mayor previously has clashed with some of the politicians that CBC's officers are close to, campaign records show that companies owned by Moliere and Woods have begun contributing to Nagin since he took charge at City Hall.
Metro Disposal, a trash-hauling company owned by Woods, gave the mayor $2,500 in February 2003 and another $2,500 in May 2004. Moliere's janitorial company, AME Services, contributed $5,000 to Nagin in February 2003. Both companies received public contracts under Morial and have maintained them during the current administration.
Nagin campaign finance records filed with the state report no donations by either of the two firms that bid unsuccessfully against CBC or by their chief executive officers.
But Nagin's chief administrative officer, Charles Rice, said politics played no part in the mayor's selection of CBC. Rather, the mayor wanted to save the city money and help out local, minority-owned businesses. When asked why the city didn't award both contracts to Total Sentencing Alternatives Program, the minority bidder with the most experience and a higher rating by the selection committee, Rice said the mayor wanted to "spread the wealth."
"I think what the public needs to know is that we selected two vendors, both African-American owned companies, both local vendors, and if we can receive the same service at virtually the same cost from a local vendor, I think it's in the city's best interest to keep the money here at home and employ local people rather than send the money to Georgia," Rice said, referring to the highest-rated and cheapest bidder, PPS of Lawrenceville, Ga.
PPS is a subsidiary of the publicly traded company Universal Health Services.
Rice also said it is his understanding that Valdes is no longer a principal of CBC. Moliere said that's true, but that Valdes continues to provide marketing services for the company. Former Jefferson Parish Council President Robert Evans Jr. also worked for a time as the company's executive vice president, according to CBC's bid documents. Moliere said Evans is no longer with the company.
Cheaper way to monitor
Home monitoring systems have become popular in recent years as cities nationwide grapple with the skyrocketing costs of incarceration. Using voice recognition technology, electronic bracelets or GPS tracking, home monitoring allows nonviolent offenders to remain out of jail while fulfilling the terms of their court sentence.
Proponents say it's an especially viable concept in Municipal Court, where judges typically deal with minor offenses, such as public drunkenness, lewd conduct or criminal trespassing.
But until now, Municipal Court has used home monitoring on a limited basis, with the offender picking up the cost. Rice said enrollment wasn't high enough to significantly cut the city's jail costs, which have ballooned from $29 million in 2002 to $35.1 million last year for all offenders.
"We live in a very poor city, and most of the individuals in Municipal Court are indigent and do not have the financial wherewithal to pay costs," Rice said.
So the city has moved to government-financed home monitoring system, which Municipal Judge John Shea said gives judges an alternative to throwing offenders in jail when they don't pay fines. Last year, almost 34,000 offenders went to jail after failing to pay court-ordered fines, Municipal Court Clerk Ronald Lampard said.
Now, instead of paying $22.39 a day to keep a municipal prisoner in jail, the city will pay $7.73 to CBC for voice monitoring and probation management, a potential savings of $14.66 per day.
The city is required to pay the cost of jailing residents who break city laws, as well as those awaiting trial on state charges.
If CBC monitors 250 to 400 offenders a day -- an average that city officials say is a reasonable estimate -- it could save taxpayers $1.3 million to $2.1 million a year.
In the program's first two months, a total of 364 offenders were enrolled, at a cost savings of $159,030, Moliere said.
How it works
The monitoring works like this:
An offender is sentenced to home monitoring, and a case worker develops a call schedule to fit the nature of the offense. The offender then calls in and registers his or her voice, and is paged, or required to call in on a prescribed schedule, depending upon where the offender is supposed to be at a certain time. If an offender fails to call in or the system detects another voice, the authorities are notified.
Rice said there is no way the city can lose under the program. CBC doesn't get paid unless offenders enroll in the program, and the more offenders enroll, the greater the savings in jail costs, he said. Judges also have the option of requiring an offender to pay for the monitoring, city officials said.
"I assure you this is not set up for anybody to make a killing off of anything," Rice said. "It's all about reducing the amount of money we pay to the sheriff, and making things more efficient."
A spokeswoman for Orleans Parish Criminal Sheriff Marlin Gusman, whose budget could be adversely affected by a decrease in jail population, said the sheriff has seen little impact thus far.
Lowest bidder skipped
But records show the city could have saved more had it awarded the contract to the low bidder.
The city's request for proposals was broken down into three parts: home monitoring, probation management and fine collection.
If the city had hired PPS, the cheapest bidder and the company with the highest score from the selection committee, it would be paying $7.50 per day for voice monitoring and probation management, compared with $7.73 a day with CBC.
Although the difference is nominal, CBC also gets 10 percent of every delinquent fine it collects, down from the 38 percent it originally proposed. PPS offered to do fine collection free of charge.
Clay Cox, chief executive officer for PPS, said even CBC's lowered price accounts for some "good margins." He also said his company would have welcomed an opportunity to renegotiate its bid.
"Getting a percentage of a fine and a fee, that's crazy," Cox said. "There is plenty of money to be made by doing it right and treating people fairly. The fine money belongs to the taxpayers."
William Welch, chief executive officer of Total Sentencing Alternatives Program, declined to comment because of his company's ongoing negotiations to monitor pretrial detainees in criminal court using electronic bracelets.
But the president of ShadowTrack Technologies, the Covington subcontractor CBC originally proposed to do the voice monitoring, said his company typically charges offenders $4.50 a day to enroll in the program, which accounts for the cost of the service and a profit to his company. Comparatively, the city has agreed to pay CBC $6.75 a day for the same type of service.
ShadowTrack did not submit an independent bid.
Short on experience
In addition to the price issue, the city selected the firm with the least experience in the criminal justice field.
Woods runs a trash-hauling company. Moliere's experience is in janitorial services and public housing, according to his resume. Valdes has worked as a financier specializing in large municipal leases.
In comparison, PPS has been in the electronic monitoring business for 16 years and holds contracts with the cities of Atlanta, Salt Lake City and Montgomery, Ala., to name a few. The company also worked with judges in New Orleans municipal and traffic courts for two years doing electronic monitoring, probation monitoring and fine collection, with offenders picking up the cost of the service, according to its bid.
TSAP began working as a protégé of PPS when the company was under contract to New Orleans' municipal and traffic courts in 2000 and 2001, and it has run the program on its own since then. It has five years of experience working in Orleans Parish courts, according to its bid.
As for CBC, the New Orleans contract is its first major job. The company has no real experience. In its bid, it cited instead the experience of three subcontractors it proposed using, including ShadowTrack.
None of the subcontractors listed in the bid is now working on the contract, Rice said.
Subcontractor severs ties
ShadowTrack president Robert Magaletta said he cut off his relationship with CBC late last year after the company first asked him to lower his price, then, without notifying him, approached a competing vendor about working on the city contract.
ShadowTrack had been with CBC from the start, signing the company on as its exclusive dealer in the metro area in October 2003. But CBC produced no significant business for ShadowTrack, Magaletta said, never having more than 10 private-pay offenders on the service at any one time.
Magaletta also said he grew increasingly leery of dealing with Woods and Valdes, who have received subpoenas from a federal grand jury investigating city contracts meted out during Morial's administration.
"I had been hearing about the problems these people were having involved with city of New Orleans," he said. "I just preferred to stay away from this group."
Moliere said in a written statement that the separation was because of "philosophical business differences and different approaches to the marketplace."
He also said CBC has provided services to criminal courts in Orleans and Jefferson parishes, New Orleans Traffic Court, and the Louisiana Department of Parole and Probation. When asked whether the company held any contracts with those agencies, Moliere said it had relationships with individual judges and agencies, but no formal contracts. He did not specify a total number of clients enrolled.
CBC replaced ShadowTrack with Biometric Corp. of Dallas, whose president says the company has six years of experience in voice-based home incarceration systems.
CBC has hired its own staff to provide probation services, Rice said. For fine collection, the company has partnered with Gavin & Associates, a woman-owned company that will fulfill the 35 percent disadvantaged business enterprise goal for the contract, Rice said.
New York deal under fire
But what CBC lacks in practical experience, it more than makes up for when it comes to the politics of cutting deals with governments.
Although the New Orleans contract has drawn little attention, a similar CBC arrangement in Buffalo, N.Y., is being investigated by the FBI.
Erie County comptroller Nancy Naples has alleged that George A. Holt Jr., chairman of the county legislature, attempted to secretly award CBC a $3 million no-bid contract by slipping in a last-minute budget amendment in a late-night meeting Dec. 8. Naples told the Buffalo News last week that she was interviewed by federal agents for more than an hour about what she says was an "illegal" deal.
When questioned about the amendment, Holt told the Buffalo News that his staff inadvertently specified Community Based Corrections in the resolution, when his intent was only to reserve money for a later competitive bidding process. Holt has agreed to meet with FBI agents later this week.
He also told the newspaper that he flew to New Orleans in August to visit the firm, during which time CBC's principals held a fund-raiser for him at Pampy's Creole Kitchen, a political hot spot owned by Morial confidant Stan Barre. Campaign finance reports show that Holt received three checks at that function: $500 from Woods, $200 from Barre and $250 from bail bondsman Blair Boutte.
Barre, who has been subpoenaed in the ongoing federal probe of contracts awarded under Morial, said he has nothing to do with Community Based Corrections.
"I'm telling you, I wish those guys well, but I've got nothing to do with that bracelet stuff."
As for his contribution to Holt, Barre said: "I think I wrote him a check because Burnell (Moliere) begged like I don't know what, and he's a good customer," Barre said.
Boutte, president of the small eastern New Orleans political organization DOVE, also confirmed writing Holt a check. But he said he is not affiliated with CBC and did not attend the fund-raiser at Pampy's.
Holt got only one other contribution during the six-month reporting period that ended Jan. 15. He told the Buffalo News that accepting the $500 from Woods was a mistake and that he intends to return the money.
Active in politics
In New Orleans, the political connections necessary for deal-making were already well established.
Woods has a piece of the city's waste disposal contract through his company Metro Disposal Inc. Woods also has served on fund-raising committees for Jordan and donated $10,000 to Morial's third-term effort through Metro Disposal.
Moliere's Norco-based janitorial company, AME Services, has major contracts with the Orleans Parish School Board and the New Orleans Aviation Board. However, Schools Superintendent Tony Amato has threatened in recent months to cancel AME's contract, claiming the company has collected millions while leaving campuses filthy.
Moliere also contributed to Jordan, served on his fund-raising committees and headed his transition team. Moliere and AME Services contributed $10,000 to Morial's attempt at a third term.
Valdes, based in Metairie, arranged the financing for numerous high-dollar equipment leases at City Hall during Morial's tenure, including a controversial $81 million energy-efficiency contract with Johnson Controls Inc. that has been a focus of the ongoing federal investigation of Morial-era contracts. Valdes also arranged leases for hundreds of city buses, police cars and other vehicles. Top Nagin officials have complained bitterly about the above-market financing fees in some of those deals, which won't be completely paid off until 2022.
The financier contributed $5,000 to Jordan's 2002 campaign for district attorney through one of his companies, American Lease Financing LLC. He and a relative also made corporate and personal contributions of $15,000 to Morial's third-term bid. Valdes is the ex-husband of former Jefferson Parish Councilwoman Anne Marie Vandenweghe.
Metro Disposal and AME Services have likewise come under criticism from the Nagin administration.
In hiring Kimberly Williamson Butler as his first chief administrative officer, Nagin approvingly cited an episode in which Butler, as director of the Downtown Development District, refused to cave into political pressure and award a street-cleaning contract to AME.
Metro Disposal, meanwhile, was written up and briefly put on probation by former Sanitation Director Lynn Wiltz, who said in memos that the company had failed to live up to parts of its contract. Wiltz was fired a few months later, and Rice has said he is satisfied with Metro Disposal's performance.
Ditto for AME, he said.
"My experience with AME has been positive," he said. "They've done a pretty good job for us maintaining Gallier Hall and several other buildings."
Showing posts with label Charles Rice. Show all posts
Showing posts with label Charles Rice. Show all posts
Friday, September 21, 2007
Sunday, April 8, 2007
New meters to bring new ways to buy time -- Times Picayune Dec. 31, 2004
December 31, 2004 Friday
SECTION: NATIONAL; Pg. 1
LENGTH: 1709 words
HEADLINE: New meters to bring new ways to buy time;
But they also require hike from car and back
BYLINE: By Frank Donze , Staff writer
BODY:
With a control panel that looks like the dashboard of a state-of-the-art sportscar, they have begun cropping up on downtown curbsides. ATM machines? Gas pumps? Guess again.
They're the latest generation of parking meters, 6-foot-tall replacements for the old-time bubbles on a stick that have eaten dimes and quarters for decades.
City officials insist you won't need a degree in computer science to make them work, though it will help to be thoroughly comfortable with your cell phone. And a certain amount of hiking will be required, from your car to the meter and back again.
But after much anticipation, this much can be said for sure: They're here -- and almost operational.
City Hall's oft-heard promise that new, high-tech parking meters soon will be hitting the streets of New Orleans had taken on the hollow ring of "The check is in the mail" and "Your table will be ready in a minute."
For more than 10 years running, three successive mayoral administrations heralded the imminent arrival of cutting-edge meters that would accept "smart" debit cards, eliminating the dreaded scramble for pocket change that's never quite enough.
The debit cards still are in the offing. But the first of the futuristic meters, which cost about $7,500 apiece, began popping up around town about a month ago, and they eventually will allow motorists to use credit cards as well as coins -- and even an option, the first of its kind in the United States, to pay for parking by cell phone.
Nagin administration officials said this week that they expect the new system to be running by mid-January and pledged that the "smart" cards and cell phone option will be operational later in 2005.
The project is being handled by a 50-50 partnership between Standard Parking, a national firm that has operated parking lots in New Orleans for 25 years, and Parking Solutions LLC, a local minority-owned company with political ties to City Hall.
The Nagin administration has signed a three-year, $2.1 million contract with the joint venture, including options for three one-year renewals. The company is responsible for operation and maintenance of the meters, which the city projects will generate $4.5 million in 2005, a 15 percent increase over this year's take.
Ultimately, plans call for 400 of the new meters to be scattered about the Central Business District, the French Quarter, the Warehouse District, along Magazine Street and in the Uptown and downtown medical districts. About half of them have been installed so far, with the balance of the job scheduled to be completed by Feb. 1.
The joint venture owns the meters but the city will acquire them under a lease-purchase arrangement. Under the contract, leasing fees will come out of the city's monthly payment of $173,000.
The city will own the meters at the end of the six-year agreement. Their estimated life span is 10 to 12 years.
The space-age look of the new meters, which dwarf the old model, has drawn criticism from some residents of the French Quarter, who say the green towers are out of scale for the historic neighborhood.
"We've heard from some people who say the meters are too modern for areas like the Quarter and Magazine Street," said Mark Boucree, Parking Solutions' chief operating officer. "But we think once everyone sees the convenience they offer, they'll get used to them."
Administration officials hope to put the meters in operation in stages, with the first areas set to go on line in about two weeks, after signage is in place and an informational campaign is under way.
In addition to accepting credit cards and debit cards, the new meters -- like the ones now in use -- will take all coins except pennies. Paper currency, which company officials say has a tendency to jam the mechanism, cannot be used.
The city will retain about 1,000 of the 3,600 or so of the meters currently in use. Those meters, though they accept coins only, were designed to accept a "smart card," and officials with the company that installed them said they have long been ready to introduce one. But Nagin opted to go with the new meters instead.
Officials in the administration say a key selling point of the new devices was their ability to offer a "pay and display" system, already used in several U.S. and European cities, that lets motorists buy parking time that isn't tied to one particular space.
Under the system, two meters located in the middle of the block replace the six to 12 devices that now line many streets. Just like existing meters, the new ones will allow a motorist to buy up to two hours of parking time.
But instead of displaying the time remaining, the new machine spits out a receipt. A motorist will have to return to the vehicle and display the ticket -- which will prominently feature the expiration time -- on the dashboard.
Administration officials say the new system offers ancillary benefits: For one, motorists can move their car to another metered space while there is still time remaining on the ticket. Also, the printed receipt provides a handy record that can be used for accounting and reimbursement purposes.
More revenue expected
The administration's increased revenue projection is based on several factors.
Most important, city officials say the new system will bring the city revenue from 4,500 parking spaces citywide, an increase of about 900. Part of the increase will come from charging people to park in areas where parking is now free.
In addition, they say the new meters will allow a few extra parking spaces to be squeezed out of a street because there are no spaces per se. For example, parking areas that now contain seven striped spaces might now fit eight vehicles. But then, there's nothing to stop sloppy parkers from hogging space, thus reducing the number of customers.
Finally, under the new system, the administration says drivers now will take their unused parking time with them. As a result, no one will be able to park for free.
Old meters just paid for
The new meters are arriving just a few years after WorldWide Parking Inc., the Maryland-based company that formerly held the city parking meter contract, finished installing the current generation of meters. In fact, the Nagin administration made the final $400,000 payment on WorldWide's equipment just a few months ago.
WorldWide bid on the new contract, but the Nagin administration selected the local partnership in March, citing technological factors and the 50 percent minority participation.
WorldWide, which had no local partner, went to court to block the award of the contract, arguing that as the lowest responsible bidder, it should have been selected. The Nagin administration countered that the lowest-bid criterion was inapplicable because the contract is for a professional service.
The lawsuit was dismissed by a federal judge.
At the time of the contract award, Marc Meisel, president of WorldWide, questioned the administration's projections that the new meters would increase revenue. Furthermore, he said the meters now on the street likely would last another 25 years.
The new meters are solar-powered, but also have a battery back-up. The system is linked to a computer network that will allow company and city officials to monitor each meter and determine in real time whether it's working, how much revenue it has taken in and even whether it is low on paper for receipts.
Under its contract with the city, Parking Solutions must keep 98 percent of the meters in service at all times or face cash fines. Company officials said the computer monitoring system will allow them to fulfill that requirement easily.
Cell phone innovation
The ability to activate the meters by cell phone is their most radical innovation and a first of its kind in the United States, according to Boucree.
The system, invented by Mint Inc., a company based in Toronto, Canada, allows customers to purchase parking time without leaving their vehicles.
Motorists interested in using the service will first have to phone a number listed on the meter to set up an account that Boucree calls an "electronic wallet." Once a motorist has registered a name and license plate number with Mint Inc., the company will send the customer a windshield sticker that city parking control officers -- using hand-held computers -- can scan to determine whether the parking fee has been paid.
The company also will automatically phone customers a half-hour before their time at the meter expires. If they desire, customers also can call again to obtain more parking time -- up to a legal maximum of two hours.
Boucree said plans call for this payment system to be operating by May.
Chief Administrative Officer Charles Rice said the Nagin administration is looking into a change in the law that would permit a motorist -- for a nominal extra fee -- to park in a metered space for longer than two hours.
Plans call for the "smart" cards to be on sale by the summer.
Parking Solutions officials say they have started preliminary discussions with the Regional Transit Authority to develop a single debit card that could be used on parking meters, buses and streetcars.
Parking Solutions is owned by three local African-American businessmen. In recent months, Nagin has touted the 50-50 partnership as a prime example of his administration's commitment to steer government work to black-owned companies.
Two of the local firm's principals, Keith Pittman and Tyrone Rodgers, have ties to the administration.
Pittman and Rodgers are former business partners of developer Sean Cummings, a Nagin appointee who heads the New Orleans Building Corp., which is responsible for selling or developing certain city-owned properties.
Rodgers is the stepson of public-relations executive Bill Rouselle, who has advised Nagin and who has close ties to the BOLD political organization. Pittman worked as an aide to City Councilman Oliver Thomas, a leader of BOLD.
Boucree recently resigned his management position with Standard Parking, where he oversaw 40 facilities for the company.
This is the second contract the Nagin administration has awarded to Standard Parking and Parking Solutions. In May, the partnership was hired to operate three parking lots for French Market Corp.
SECTION: NATIONAL; Pg. 1
LENGTH: 1709 words
HEADLINE: New meters to bring new ways to buy time;
But they also require hike from car and back
BYLINE: By Frank Donze , Staff writer
BODY:
With a control panel that looks like the dashboard of a state-of-the-art sportscar, they have begun cropping up on downtown curbsides. ATM machines? Gas pumps? Guess again.
They're the latest generation of parking meters, 6-foot-tall replacements for the old-time bubbles on a stick that have eaten dimes and quarters for decades.
City officials insist you won't need a degree in computer science to make them work, though it will help to be thoroughly comfortable with your cell phone. And a certain amount of hiking will be required, from your car to the meter and back again.
But after much anticipation, this much can be said for sure: They're here -- and almost operational.
City Hall's oft-heard promise that new, high-tech parking meters soon will be hitting the streets of New Orleans had taken on the hollow ring of "The check is in the mail" and "Your table will be ready in a minute."
For more than 10 years running, three successive mayoral administrations heralded the imminent arrival of cutting-edge meters that would accept "smart" debit cards, eliminating the dreaded scramble for pocket change that's never quite enough.
The debit cards still are in the offing. But the first of the futuristic meters, which cost about $7,500 apiece, began popping up around town about a month ago, and they eventually will allow motorists to use credit cards as well as coins -- and even an option, the first of its kind in the United States, to pay for parking by cell phone.
Nagin administration officials said this week that they expect the new system to be running by mid-January and pledged that the "smart" cards and cell phone option will be operational later in 2005.
The project is being handled by a 50-50 partnership between Standard Parking, a national firm that has operated parking lots in New Orleans for 25 years, and Parking Solutions LLC, a local minority-owned company with political ties to City Hall.
The Nagin administration has signed a three-year, $2.1 million contract with the joint venture, including options for three one-year renewals. The company is responsible for operation and maintenance of the meters, which the city projects will generate $4.5 million in 2005, a 15 percent increase over this year's take.
Ultimately, plans call for 400 of the new meters to be scattered about the Central Business District, the French Quarter, the Warehouse District, along Magazine Street and in the Uptown and downtown medical districts. About half of them have been installed so far, with the balance of the job scheduled to be completed by Feb. 1.
The joint venture owns the meters but the city will acquire them under a lease-purchase arrangement. Under the contract, leasing fees will come out of the city's monthly payment of $173,000.
The city will own the meters at the end of the six-year agreement. Their estimated life span is 10 to 12 years.
The space-age look of the new meters, which dwarf the old model, has drawn criticism from some residents of the French Quarter, who say the green towers are out of scale for the historic neighborhood.
"We've heard from some people who say the meters are too modern for areas like the Quarter and Magazine Street," said Mark Boucree, Parking Solutions' chief operating officer. "But we think once everyone sees the convenience they offer, they'll get used to them."
Administration officials hope to put the meters in operation in stages, with the first areas set to go on line in about two weeks, after signage is in place and an informational campaign is under way.
In addition to accepting credit cards and debit cards, the new meters -- like the ones now in use -- will take all coins except pennies. Paper currency, which company officials say has a tendency to jam the mechanism, cannot be used.
The city will retain about 1,000 of the 3,600 or so of the meters currently in use. Those meters, though they accept coins only, were designed to accept a "smart card," and officials with the company that installed them said they have long been ready to introduce one. But Nagin opted to go with the new meters instead.
Officials in the administration say a key selling point of the new devices was their ability to offer a "pay and display" system, already used in several U.S. and European cities, that lets motorists buy parking time that isn't tied to one particular space.
Under the system, two meters located in the middle of the block replace the six to 12 devices that now line many streets. Just like existing meters, the new ones will allow a motorist to buy up to two hours of parking time.
But instead of displaying the time remaining, the new machine spits out a receipt. A motorist will have to return to the vehicle and display the ticket -- which will prominently feature the expiration time -- on the dashboard.
Administration officials say the new system offers ancillary benefits: For one, motorists can move their car to another metered space while there is still time remaining on the ticket. Also, the printed receipt provides a handy record that can be used for accounting and reimbursement purposes.
More revenue expected
The administration's increased revenue projection is based on several factors.
Most important, city officials say the new system will bring the city revenue from 4,500 parking spaces citywide, an increase of about 900. Part of the increase will come from charging people to park in areas where parking is now free.
In addition, they say the new meters will allow a few extra parking spaces to be squeezed out of a street because there are no spaces per se. For example, parking areas that now contain seven striped spaces might now fit eight vehicles. But then, there's nothing to stop sloppy parkers from hogging space, thus reducing the number of customers.
Finally, under the new system, the administration says drivers now will take their unused parking time with them. As a result, no one will be able to park for free.
Old meters just paid for
The new meters are arriving just a few years after WorldWide Parking Inc., the Maryland-based company that formerly held the city parking meter contract, finished installing the current generation of meters. In fact, the Nagin administration made the final $400,000 payment on WorldWide's equipment just a few months ago.
WorldWide bid on the new contract, but the Nagin administration selected the local partnership in March, citing technological factors and the 50 percent minority participation.
WorldWide, which had no local partner, went to court to block the award of the contract, arguing that as the lowest responsible bidder, it should have been selected. The Nagin administration countered that the lowest-bid criterion was inapplicable because the contract is for a professional service.
The lawsuit was dismissed by a federal judge.
At the time of the contract award, Marc Meisel, president of WorldWide, questioned the administration's projections that the new meters would increase revenue. Furthermore, he said the meters now on the street likely would last another 25 years.
The new meters are solar-powered, but also have a battery back-up. The system is linked to a computer network that will allow company and city officials to monitor each meter and determine in real time whether it's working, how much revenue it has taken in and even whether it is low on paper for receipts.
Under its contract with the city, Parking Solutions must keep 98 percent of the meters in service at all times or face cash fines. Company officials said the computer monitoring system will allow them to fulfill that requirement easily.
Cell phone innovation
The ability to activate the meters by cell phone is their most radical innovation and a first of its kind in the United States, according to Boucree.
The system, invented by Mint Inc., a company based in Toronto, Canada, allows customers to purchase parking time without leaving their vehicles.
Motorists interested in using the service will first have to phone a number listed on the meter to set up an account that Boucree calls an "electronic wallet." Once a motorist has registered a name and license plate number with Mint Inc., the company will send the customer a windshield sticker that city parking control officers -- using hand-held computers -- can scan to determine whether the parking fee has been paid.
The company also will automatically phone customers a half-hour before their time at the meter expires. If they desire, customers also can call again to obtain more parking time -- up to a legal maximum of two hours.
Boucree said plans call for this payment system to be operating by May.
Chief Administrative Officer Charles Rice said the Nagin administration is looking into a change in the law that would permit a motorist -- for a nominal extra fee -- to park in a metered space for longer than two hours.
Plans call for the "smart" cards to be on sale by the summer.
Parking Solutions officials say they have started preliminary discussions with the Regional Transit Authority to develop a single debit card that could be used on parking meters, buses and streetcars.
Parking Solutions is owned by three local African-American businessmen. In recent months, Nagin has touted the 50-50 partnership as a prime example of his administration's commitment to steer government work to black-owned companies.
Two of the local firm's principals, Keith Pittman and Tyrone Rodgers, have ties to the administration.
Pittman and Rodgers are former business partners of developer Sean Cummings, a Nagin appointee who heads the New Orleans Building Corp., which is responsible for selling or developing certain city-owned properties.
Rodgers is the stepson of public-relations executive Bill Rouselle, who has advised Nagin and who has close ties to the BOLD political organization. Pittman worked as an aide to City Councilman Oliver Thomas, a leader of BOLD.
Boucree recently resigned his management position with Standard Parking, where he oversaw 40 facilities for the company.
This is the second contract the Nagin administration has awarded to Standard Parking and Parking Solutions. In May, the partnership was hired to operate three parking lots for French Market Corp.
Mayor's top aide quitting to join law firm -- Times Picayune June 28, 2005
June 28, 2005 Tuesday
SECTION: METRO; Pg. 1
LENGTH: 634 words
HEADLINE: Mayor's top aide quitting to join law firm;
Rice cites pressures of politics on family
BYLINE: By Martha Carr and Gordon Russell, Staff writers
BODY:
Confirming a rumored shakeup in the top tier of Mayor Ray Nagin's administration, an emotional Chief Administrative Officer Charles Rice said Monday that he is resigning his post to take a job at a law firm.
Rice, who joined the administration in June 2002 as city attorney, said the pressures of political life had taken a toll on his family, particularly his two sons, ages 8 and 10.
"Probably the most telling point was about six months ago, when my 10-year-old wrote me a letter," Rice said, fighting back tears. "He basically said, 'I want you at home more.' And for me, that was it."
Rice, 41, will remain in his post until the end of July. Nagin said he hopes to name a permanent successor by then. Without mentioning any candidates for the job, he said he plans to look internally first, a remark that fueled rumors he is eyeing Economic Development Director Don Hutchinson for the post.
Hutchinson did not return a request for comment.
Rice will join the law firm of Barrasso, Usdin, Kupperman, Freeman & Sarver LLC, a group that broke off from the Stone Pigman firm two years ago and does mostly commercial litigation. Rice, a former litigator for Entergy, said he has received multiple job offers but that this was the best fit.
"People need to realize when you are so-called 'marketable,' people come to you with opportunities," Rice said. "For me, this was the right time, and I think I'll be wildly successful in whatever I choose to do. Hopefully I'll be able to capitalize on some of the relationships that I've developed here."
Both Rice and Nagin, through his spokeswoman, denied Friday that any such move was in the works. However, Nagin said Monday that he has been aware for six months that Rice was looking for a new job and was just waiting for Rice's final notice.
Nagin said Rice's most impressive contribution was his effort to award a larger share of city contracts to African-American-owned businesses.
"He pushed very hard for minority business to participate at unprecedented levels," Nagin said.
Nagin also commended Rice for helping pass the city's largest bond issue, overseeing 260,000 pothole repairs, revamping the sanitation department, helping balance the city budget and awarding a new parking meter contract: the latter a controversial move that drew plenty of fire.
"I predict that as time goes on, people will say that that was one of the best moves the city of New Orleans has made in recent history," Nagin said.
But the parking meter contract and at least two others awarded on Rice's watch weren't universally viewed as good business.
The joint venture that won the meter contract got the job despite the fact that its price was 62 percent higher than the lowest bid the city received.
Rice defended the deal, saying the "pay and display" meters were technologically superior to the cheaper ones, and that the joint venture's bid was more attractive in part because a black-owned company was an equal partner in the venture.
In another contract flap, without seeking bids, Rice bought 600 trash cans with advertising panels from a company that had a business relationship with his brother, Terrence Rice, even though other firms routinely offer such receptacles for free. The contract also gave the city less of the advertising revenue than is standard in such arrangements.
Rice deflected questions about his brother's involvement with the firm. He said the cans were a better deal than the ones the city had previously used, and said their claim of being "bombproof" made for added safety. More recently, Rice said the contract to sell advertising on the cans would be rebid on terms more favorable to the city.
SECTION: METRO; Pg. 1
LENGTH: 634 words
HEADLINE: Mayor's top aide quitting to join law firm;
Rice cites pressures of politics on family
BYLINE: By Martha Carr and Gordon Russell, Staff writers
BODY:
Confirming a rumored shakeup in the top tier of Mayor Ray Nagin's administration, an emotional Chief Administrative Officer Charles Rice said Monday that he is resigning his post to take a job at a law firm.
Rice, who joined the administration in June 2002 as city attorney, said the pressures of political life had taken a toll on his family, particularly his two sons, ages 8 and 10.
"Probably the most telling point was about six months ago, when my 10-year-old wrote me a letter," Rice said, fighting back tears. "He basically said, 'I want you at home more.' And for me, that was it."
Rice, 41, will remain in his post until the end of July. Nagin said he hopes to name a permanent successor by then. Without mentioning any candidates for the job, he said he plans to look internally first, a remark that fueled rumors he is eyeing Economic Development Director Don Hutchinson for the post.
Hutchinson did not return a request for comment.
Rice will join the law firm of Barrasso, Usdin, Kupperman, Freeman & Sarver LLC, a group that broke off from the Stone Pigman firm two years ago and does mostly commercial litigation. Rice, a former litigator for Entergy, said he has received multiple job offers but that this was the best fit.
"People need to realize when you are so-called 'marketable,' people come to you with opportunities," Rice said. "For me, this was the right time, and I think I'll be wildly successful in whatever I choose to do. Hopefully I'll be able to capitalize on some of the relationships that I've developed here."
Both Rice and Nagin, through his spokeswoman, denied Friday that any such move was in the works. However, Nagin said Monday that he has been aware for six months that Rice was looking for a new job and was just waiting for Rice's final notice.
Nagin said Rice's most impressive contribution was his effort to award a larger share of city contracts to African-American-owned businesses.
"He pushed very hard for minority business to participate at unprecedented levels," Nagin said.
Nagin also commended Rice for helping pass the city's largest bond issue, overseeing 260,000 pothole repairs, revamping the sanitation department, helping balance the city budget and awarding a new parking meter contract: the latter a controversial move that drew plenty of fire.
"I predict that as time goes on, people will say that that was one of the best moves the city of New Orleans has made in recent history," Nagin said.
But the parking meter contract and at least two others awarded on Rice's watch weren't universally viewed as good business.
The joint venture that won the meter contract got the job despite the fact that its price was 62 percent higher than the lowest bid the city received.
Rice defended the deal, saying the "pay and display" meters were technologically superior to the cheaper ones, and that the joint venture's bid was more attractive in part because a black-owned company was an equal partner in the venture.
In another contract flap, without seeking bids, Rice bought 600 trash cans with advertising panels from a company that had a business relationship with his brother, Terrence Rice, even though other firms routinely offer such receptacles for free. The contract also gave the city less of the advertising revenue than is standard in such arrangements.
Rice deflected questions about his brother's involvement with the firm. He said the cans were a better deal than the ones the city had previously used, and said their claim of being "bombproof" made for added safety. More recently, Rice said the contract to sell advertising on the cans would be rebid on terms more favorable to the city.
Tuesday, March 27, 2007
Storm work deals go to inside players -- Time Picayune, Nov. 26, 2005
SECTION: NATIONAL; Pg. 1
LENGTH: 2747 words
HEADLINE: Storm work deals go to inside players;
Contracts could hurt state's image
BYLINE: By Gordon Russell, Staff writer
BODY:
Weeks after Charles Rice left his post as chief administrative officer of the city of New Orleans in June, the city sanitation department sought to hire a contractor for storm debris removal.
The day before Hurricane Katrina made landfall, Mayor Ray Nagin signed a contract potentially worth tens of millions of dollars with Omni Pinnacle of Slidell.
Omni's offer wasn't the cheapest of the six offers the city received. But the city didn't have to pick the low bidder, an experienced firm, because the job was considered a professional service rather than a finite task.
City sanitation director Veronica White, who oversaw the selection process, was hired into her city post by Rice. Rice, meanwhile, has turned up on Omni's payroll in his new position as a lawyer. Omni has also been represented in contract talks with the city and the Army Corps of Engineers by Rice's brother, Terrence Rice, according to a corps official.
The Rices' work for Omni is just one of many instances in which the politically connected have landed work as subcontractors in the few hot economic markets of post-Katrina New Orleans. Whether the job involves debris removal and staging, roof tarping, trailer sales or building inspection and cleanup, people with familiar names and faces are making money -- often in areas where they seemed to have no particular expertise before the storm. It's a sign, observers say, that perhaps the Louisiana way wasn't washed away with the storm's floodwaters.
Apart from the Rices, those who have found work related to Katrina's aftermath include a powerful lobbyist, a couple of state representatives, and, for a time, a St. Tammany Parish Council member. With the exception of the St. Tammany contract, which also involves Omni Pinnacle and which resulted in the filing last week of federal extortion charges against Councilman Joe Impastato, none of the contracts appears to involve anything illegal.
The impression that the Louisiana political and business worlds are inextricably entwined could hurt the state's chances of getting the federal help it needs, said Rafael Goyeneche, president of the Metropolitan Crime Commission.
"Our recovery depends on every dollar coming into this area to be used effectively and efficiently to rebuild our state and city," said Goyeneche. "I can't emphasize enough how precarious our position is."
Shaw Group Inc.
In spite of its ties to the Rices, Omni is far from being at the top of the politically connected contracting food chain.
That distinction arguably belongs to the Baton Rouge-based Shaw Group Inc., which has landed deals worth at least $300 million in areas as diverse as dewatering, tarping and building inspection. While the company's bona fides have not been publicly challenged -- it is one of the state's few Fortune 500 companies and has expertise in infrastructure repair -- competitors have attacked the size and value of some of the contracts Shaw has landed.
Shaw's political connections are well-known. Until just weeks ago, its chief executive officer, Jim Bernhard, was chairman of the state Democratic Party. Bernhard also was a strong supporter of Gov. Kathleen Blanco in the 2003 gubernatorial runoff, and he was chairman of Blanco's transition team.
For good measure, one of the firm's lobbyists is Joe Allbaugh, who was George W. Bush's chief of staff when Bush was governor of Texas, and ran Bush's successful 2000 presidential campaign. Allbaugh then served as director of the Federal Emergency Management Agency under Bush until 2003.
The company has said it has received the work because of its experience in post-disaster services. But responding to criticism about the contracts, the Federal Emergency Management Agency last month pledged to rebid a $100 million contract with Shaw covering a variety of services that the agency awarded with little or no competition.
Feeling the sting, perhaps, Shaw has recently launched a public-relations campaign including television ads in which Bernhard, using a highlighter pen to scrawl across the screen, touts the firm and its contributions to the state's economy.
Capitol clout
Compared with the Shaw Group, many of the other politically connected companies and individuals who have landed storm-related work rank as small fry. But that doesn't mean they're scrounging for scraps.
Randy Haynie, who is often described as the state's most influential lobbyist and who also has enviable access to the Blanco administration, landed a subcontract with ECC Operating Services, one of four companies that each received debris-removal contracts worth up to $500 million apiece with the Army Corps of Engineers.
Corps documents indicate that Haynie was hired for public relations, but the corps has refused to release specific figures on what any subcontractors, including Haynie, have been paid. Haynie did not return phone calls seeking comment.
Haynie's work is no doubt far less lucrative than three deals worth $108 million landed recently by a motorcycle shop owned by the father and uncle of state Rep. Gary Smith, D-Norco. Under the contracts, Bourget's of the South, which until recently lacked the state license needed to sell new trailers, is to supply FEMA with 6,416 travel trailers, according to FEMA.
Rep. Smith is the registered agent for the company, according to state records. But his father and uncle have said that their success in winning contracts has nothing to do with the political clout of Rep. Smith, who sits on the House Special Committee on Disaster Planning, Crisis Management, Recovery and Long-Term Revitalization.
State records show that Rep. Smith also serves as the agent for a firm called Alliance Construction, which incorporated weeks after the storm and soon landed a subcontract for debris hauling with Ceres Environmental Services Inc., one of the region's four main haulers. Federal officials have so far been unwilling to divulge the amount of such subcontracts.
Rep. Smith did not return calls about that contract.
One other state legislator, state Rep. Troy Hebert, D-New Iberia, also has his hand in the world of debris removal. Hebert has said he has worked as the subcontractor of a subcontractor of a subcontractor in hurricane debris removal. But he scoffed at the notion that political influence had anything to do with his landing work.
"I've been having a tractor since I was 14," he said. "I worked cleaning up Hurricane Andrew. If I was on the level of (a first-tier sub), then you could accuse me of that."
Local players
Debris pick-up is also the job for which the city of New Orleans hired Omni Pinnacle, the firm Charles Rice represents.
City officials denied that Rice played any role in Omni getting the contract in August. Rice said he has never negotiated with the city on Omni's behalf. And Terrence Rice said he has only attended meetings on behalf of his own firm, T. Rice and Associates.
In selecting Omni, the city bypassed DRC Emergency Services of Mobile, Ala., a company with debris removal contracts in many parts of the country that submitted the lowest price.
City sanitation director Veronica White said price was "one of several evaluation criteria on the proposal," and that Omni "ranked the highest when all criteria were evaluated." She did not say which factors put Omni over the top.
But DRC's officials are raising questions about Omni's selection.
"I'm shocked to learn that we were the low bidder and were not awarded this contract," Bob Isakson, head of DRC, said recently when told about the city's choice. "I'm certain our qualifications were more than sufficient."
It's unclear when Charles Rice began working for Omni. He and Omni's owner, Ronald Reine, both said their relationship sprang up after the firm received a city contract as Katrina approached New Orleans. When asked for a copy of Charles Rice's contract, however, Reine said through a spokeswoman that he could not locate it. Charles Rice and Reine also said Rice never contacted city officials while representing Omni.
Omni's position as the city's main debris collector lasted until Sept. 23, when the parties agreed to suspend the deal because the Corps of Engineers' policy is to pay only 90 percent of the cost as long as the city continued to supervise debris removal. To have the corps pick up the full cost, it would have to oversee the contract.
The corps' top contractors for that work in New Orleans were ECC and Phillips & Jordan Inc., two national disaster-management firms. But that did not mean Omni was out.
On Sept. 17, an agreement was struck under which Omni would become a "first-tier" subcontractor under both ECC and Phillips & Jordan, said Allen Morse, a debris expert for the corps. He said Omni was represented at the meeting by Reine and Terrence Rice. The city was represented at the meeting by White of the sanitation department, Morse said.
"They were trying to see if Omni could be absorbed by the prime contractors," Morse said.
Through spokeswoman Betsie Gambel, Reine said Terrence Rice had never represented him at anything except perhaps a job fair. Told that a corps official had said otherwise, Reine -- whose company walked off the job Friday citing unpaid invoices -- retorted: "Is this the same corps that owes me $20 million?"
Terrence Rice, through e-mail, said that the only meetings he attended "were on behalf of T. Rice and Associates and only T. Rice and Associates."
The Rices' work for Omni when the firm had a direct contract with the city did not necessarily violate any ethics rules, which say high-ranking public officials cannot do business with an agency they served until two years after the date they left the agency.
Charles Rice said he was well aware of such laws. He said he even sought recently an advisory opinion from the ethics board as to whether he could represent clients with business before the City Council or other city agencies.
The board said unequivocally that he could not do business with the city administration and initially forbade him from working with the council and other agencies. Rice said the board intends to revise the latter part of that opinion.
But in any case, Rice said, his only meetings on behalf of Omni had been with corps officials.
"The facts are, I appeared at a meeting with the Corps of Engineers and Omni Pinnacle, and I attended a meeting between Omni Pinnacle and Phillips & Jordan," Rice said. "I have never, and I repeat never, appeared at any meeting between Omni Pinnacle and any city officials."
Reine likewise said there was no connection between his hiring of Charles Rice and his success at City Hall.
"I did not know either Terrence or Charles until way after the city contracts were signed," Reine said through Gambel. "Since I met them, I have had minimal contact with them. Terrence represented me in a job fair. Charles has reviewed some contracts.
"No one ever spoke with the city on my behalf. I've never had any firm lobbying on his behalf for this or any city contract."
Federal charge
The contract Omni had with New Orleans is not the only controversial deal involving the firm and a political figure. Another contract in a different parish, has sparked the first post-Katrina public corruption indictment in south Louisiana.
Federal prosecutors last week charged St. Tammany Councilman Joe Impastato with extortion after he allegedly told a St. Tammany Parish landowner that he could set him up with a subcontract through Omni for a price. Impastato has denied that he's done anything illegal.
According to the federal complaint, Impastato demanded half the subcontract's $200,000 value. While Omni has not been charged with any wrongdoing, the complaint suggests that Impastato was able to deliver favors and retribution through Omni.
The contract that Impastato allegedly promised the landowner indeed materialized, the federal document said. But after the landowner refused to pay the graft, Omni stopped using the landowner's property, the complaint said. Prosecutors declined to directly answer questions about whether they believed Omni was complicit in the alleged scheme.
Reine declined to comment on the matter, citing the ongoing investigation. He said his company is not under scrutiny.
Subcontract awarded
Terrence Rice wound up with a subcontract from ECC when that firm took over New Orleans' prime debris-collection contract from Omni.
Allan Katz, a spokesman for ECC, said that Terrence Rice's company, T. Rice & Associates, had "performed several services for ECC and performed them well."
He did not say what the services were. Terrence Rice declined to answer questions about his work.
Another business owner who has also wound up with a lucrative subcontract from ECC, according to the firm, is Michael Sullivan, owner of TSG Solutions. Charles Rice has described Sullivan as a friend and occasional dinner companion. Sullivan won two subcontracts from city agencies during Rice's tenure as chief administrative officer, with deals netting TSG at least $1.3 million, according to city records. But Charles Rice said his friendship with Sullivan blossomed only after TSG firm received its city contracts.
Sullivan's resume says his firm's focus is "strategic planning, economic development and business development." Gambel, who is representing TSG as well as Omni, said TSG is mainly "doing debris hauling and solid-waste work." She added: "They've invested in a number of pieces of equipment to get the job done."
The company's work force now numbers about 40, Gambel said. She said that the work hews closely to TSG's mission of working in "construction-related fields."
Another well-known actor in political circles who has been retained by ECC is Bernard "Bunny" Charbonnet, a New Orleans Dock Board member and a leader of the political organization COUP.
Charbonnet, whose planning firm has offices in three states, said he initially received a contract worth up to about $500,000 to provide a project manager and about 10 other employees to oversee debris removal. He said he left the job after taking in about $100,000 because "it wasn't a good fit."
"It's nothing against ECC," Charbonnet said. "It just wasn't good for my company."
Subs tied to city
Some of the politically connected companies involved in the post-Katrina work have gotten work through The Shaw Group, which is the prime contractor for building inspections in New Orleans.
Shaw's major subcontractors include some companies well-known around City Hall. Among them: the engineering firms Three Fold Consultants, N-Y Associates and Citywide Testing and Inspection, the last one owned by Roy Glapion Jr., son of a late city councilman. All three firms have been active players in local politics, and Citywide and N-Y in particular have often been tapped for public contracts, public records show. All three companies have donated to Nagin's campaigns, with Three Fold giving a total of $6,000 and Citywide and N-Y Associates $10,000 apiece, state campaign finance records show.
Representatives of N-Y referred questions about their work to the Shaw Group. Officials from Three Fold and Citywide did not return phone calls.
The engineering firm Montgomery Watson Harza, which holds a contract for catch-basin cleaning and other debris-removal services, is also employing a familiar roster of subcontractors, including Three Fold and Citywide, and Sullivan's TSG.
It's unclear exactly how important connections to state or local politics are in the awarding of contracts or subcontracts. Officials at all levels have said that they seek the best deal they can get with a prime contractor, and then leave the hiring of subcontractors to that company.
And while elected officials have argued publicly that as much work as possible go to local firms, they say they don't lobby on behalf of particular ones.
Some degree of politics-as-usual is OK, Goyeneche said -- but there's a line that shouldn't be crossed.
"There's a tremendous push right now to see that local firms get more of this business," he said. "I'm sure they're contacting local political leaders to get those, and I'm sure they're using intermediaries to get that work.
"Should people not call on politicians and ask for favors? I don't believe that's the case. I think you can call on a friend to ask him to consider your firm, but don't go beyond that. You can't say, 'If you hire my firm, I'll do this for you.' "
. . . . . . .
Staff writers James Varney and Martha Carr contributed to this report. Gordon Russell can be reached at grussell@timespicayune.com or (504) 826-3347.
CORRECTION:
Shaw not among Fortune 500: A story in Sunday's editions identified The Shaw Group of Baton Rouge as a Fortune 500 company. While Shaw was listed as one of the nation's 500 largest companies in 2003 and 2004, the firm did not make the list in this year's rankings. (11/24/2005)
LOAD-DATE: November 26, 2005
It's not just Louisiana
LENGTH: 2747 words
HEADLINE: Storm work deals go to inside players;
Contracts could hurt state's image
BYLINE: By Gordon Russell, Staff writer
BODY:
Weeks after Charles Rice left his post as chief administrative officer of the city of New Orleans in June, the city sanitation department sought to hire a contractor for storm debris removal.
The day before Hurricane Katrina made landfall, Mayor Ray Nagin signed a contract potentially worth tens of millions of dollars with Omni Pinnacle of Slidell.
Omni's offer wasn't the cheapest of the six offers the city received. But the city didn't have to pick the low bidder, an experienced firm, because the job was considered a professional service rather than a finite task.
City sanitation director Veronica White, who oversaw the selection process, was hired into her city post by Rice. Rice, meanwhile, has turned up on Omni's payroll in his new position as a lawyer. Omni has also been represented in contract talks with the city and the Army Corps of Engineers by Rice's brother, Terrence Rice, according to a corps official.
The Rices' work for Omni is just one of many instances in which the politically connected have landed work as subcontractors in the few hot economic markets of post-Katrina New Orleans. Whether the job involves debris removal and staging, roof tarping, trailer sales or building inspection and cleanup, people with familiar names and faces are making money -- often in areas where they seemed to have no particular expertise before the storm. It's a sign, observers say, that perhaps the Louisiana way wasn't washed away with the storm's floodwaters.
Apart from the Rices, those who have found work related to Katrina's aftermath include a powerful lobbyist, a couple of state representatives, and, for a time, a St. Tammany Parish Council member. With the exception of the St. Tammany contract, which also involves Omni Pinnacle and which resulted in the filing last week of federal extortion charges against Councilman Joe Impastato, none of the contracts appears to involve anything illegal.
The impression that the Louisiana political and business worlds are inextricably entwined could hurt the state's chances of getting the federal help it needs, said Rafael Goyeneche, president of the Metropolitan Crime Commission.
"Our recovery depends on every dollar coming into this area to be used effectively and efficiently to rebuild our state and city," said Goyeneche. "I can't emphasize enough how precarious our position is."
Shaw Group Inc.
In spite of its ties to the Rices, Omni is far from being at the top of the politically connected contracting food chain.
That distinction arguably belongs to the Baton Rouge-based Shaw Group Inc., which has landed deals worth at least $300 million in areas as diverse as dewatering, tarping and building inspection. While the company's bona fides have not been publicly challenged -- it is one of the state's few Fortune 500 companies and has expertise in infrastructure repair -- competitors have attacked the size and value of some of the contracts Shaw has landed.
Shaw's political connections are well-known. Until just weeks ago, its chief executive officer, Jim Bernhard, was chairman of the state Democratic Party. Bernhard also was a strong supporter of Gov. Kathleen Blanco in the 2003 gubernatorial runoff, and he was chairman of Blanco's transition team.
For good measure, one of the firm's lobbyists is Joe Allbaugh, who was George W. Bush's chief of staff when Bush was governor of Texas, and ran Bush's successful 2000 presidential campaign. Allbaugh then served as director of the Federal Emergency Management Agency under Bush until 2003.
The company has said it has received the work because of its experience in post-disaster services. But responding to criticism about the contracts, the Federal Emergency Management Agency last month pledged to rebid a $100 million contract with Shaw covering a variety of services that the agency awarded with little or no competition.
Feeling the sting, perhaps, Shaw has recently launched a public-relations campaign including television ads in which Bernhard, using a highlighter pen to scrawl across the screen, touts the firm and its contributions to the state's economy.
Capitol clout
Compared with the Shaw Group, many of the other politically connected companies and individuals who have landed storm-related work rank as small fry. But that doesn't mean they're scrounging for scraps.
Randy Haynie, who is often described as the state's most influential lobbyist and who also has enviable access to the Blanco administration, landed a subcontract with ECC Operating Services, one of four companies that each received debris-removal contracts worth up to $500 million apiece with the Army Corps of Engineers.
Corps documents indicate that Haynie was hired for public relations, but the corps has refused to release specific figures on what any subcontractors, including Haynie, have been paid. Haynie did not return phone calls seeking comment.
Haynie's work is no doubt far less lucrative than three deals worth $108 million landed recently by a motorcycle shop owned by the father and uncle of state Rep. Gary Smith, D-Norco. Under the contracts, Bourget's of the South, which until recently lacked the state license needed to sell new trailers, is to supply FEMA with 6,416 travel trailers, according to FEMA.
Rep. Smith is the registered agent for the company, according to state records. But his father and uncle have said that their success in winning contracts has nothing to do with the political clout of Rep. Smith, who sits on the House Special Committee on Disaster Planning, Crisis Management, Recovery and Long-Term Revitalization.
State records show that Rep. Smith also serves as the agent for a firm called Alliance Construction, which incorporated weeks after the storm and soon landed a subcontract for debris hauling with Ceres Environmental Services Inc., one of the region's four main haulers. Federal officials have so far been unwilling to divulge the amount of such subcontracts.
Rep. Smith did not return calls about that contract.
One other state legislator, state Rep. Troy Hebert, D-New Iberia, also has his hand in the world of debris removal. Hebert has said he has worked as the subcontractor of a subcontractor of a subcontractor in hurricane debris removal. But he scoffed at the notion that political influence had anything to do with his landing work.
"I've been having a tractor since I was 14," he said. "I worked cleaning up Hurricane Andrew. If I was on the level of (a first-tier sub), then you could accuse me of that."
Local players
Debris pick-up is also the job for which the city of New Orleans hired Omni Pinnacle, the firm Charles Rice represents.
City officials denied that Rice played any role in Omni getting the contract in August. Rice said he has never negotiated with the city on Omni's behalf. And Terrence Rice said he has only attended meetings on behalf of his own firm, T. Rice and Associates.
In selecting Omni, the city bypassed DRC Emergency Services of Mobile, Ala., a company with debris removal contracts in many parts of the country that submitted the lowest price.
City sanitation director Veronica White said price was "one of several evaluation criteria on the proposal," and that Omni "ranked the highest when all criteria were evaluated." She did not say which factors put Omni over the top.
But DRC's officials are raising questions about Omni's selection.
"I'm shocked to learn that we were the low bidder and were not awarded this contract," Bob Isakson, head of DRC, said recently when told about the city's choice. "I'm certain our qualifications were more than sufficient."
It's unclear when Charles Rice began working for Omni. He and Omni's owner, Ronald Reine, both said their relationship sprang up after the firm received a city contract as Katrina approached New Orleans. When asked for a copy of Charles Rice's contract, however, Reine said through a spokeswoman that he could not locate it. Charles Rice and Reine also said Rice never contacted city officials while representing Omni.
Omni's position as the city's main debris collector lasted until Sept. 23, when the parties agreed to suspend the deal because the Corps of Engineers' policy is to pay only 90 percent of the cost as long as the city continued to supervise debris removal. To have the corps pick up the full cost, it would have to oversee the contract.
The corps' top contractors for that work in New Orleans were ECC and Phillips & Jordan Inc., two national disaster-management firms. But that did not mean Omni was out.
On Sept. 17, an agreement was struck under which Omni would become a "first-tier" subcontractor under both ECC and Phillips & Jordan, said Allen Morse, a debris expert for the corps. He said Omni was represented at the meeting by Reine and Terrence Rice. The city was represented at the meeting by White of the sanitation department, Morse said.
"They were trying to see if Omni could be absorbed by the prime contractors," Morse said.
Through spokeswoman Betsie Gambel, Reine said Terrence Rice had never represented him at anything except perhaps a job fair. Told that a corps official had said otherwise, Reine -- whose company walked off the job Friday citing unpaid invoices -- retorted: "Is this the same corps that owes me $20 million?"
Terrence Rice, through e-mail, said that the only meetings he attended "were on behalf of T. Rice and Associates and only T. Rice and Associates."
The Rices' work for Omni when the firm had a direct contract with the city did not necessarily violate any ethics rules, which say high-ranking public officials cannot do business with an agency they served until two years after the date they left the agency.
Charles Rice said he was well aware of such laws. He said he even sought recently an advisory opinion from the ethics board as to whether he could represent clients with business before the City Council or other city agencies.
The board said unequivocally that he could not do business with the city administration and initially forbade him from working with the council and other agencies. Rice said the board intends to revise the latter part of that opinion.
But in any case, Rice said, his only meetings on behalf of Omni had been with corps officials.
"The facts are, I appeared at a meeting with the Corps of Engineers and Omni Pinnacle, and I attended a meeting between Omni Pinnacle and Phillips & Jordan," Rice said. "I have never, and I repeat never, appeared at any meeting between Omni Pinnacle and any city officials."
Reine likewise said there was no connection between his hiring of Charles Rice and his success at City Hall.
"I did not know either Terrence or Charles until way after the city contracts were signed," Reine said through Gambel. "Since I met them, I have had minimal contact with them. Terrence represented me in a job fair. Charles has reviewed some contracts.
"No one ever spoke with the city on my behalf. I've never had any firm lobbying on his behalf for this or any city contract."
Federal charge
The contract Omni had with New Orleans is not the only controversial deal involving the firm and a political figure. Another contract in a different parish, has sparked the first post-Katrina public corruption indictment in south Louisiana.
Federal prosecutors last week charged St. Tammany Councilman Joe Impastato with extortion after he allegedly told a St. Tammany Parish landowner that he could set him up with a subcontract through Omni for a price. Impastato has denied that he's done anything illegal.
According to the federal complaint, Impastato demanded half the subcontract's $200,000 value. While Omni has not been charged with any wrongdoing, the complaint suggests that Impastato was able to deliver favors and retribution through Omni.
The contract that Impastato allegedly promised the landowner indeed materialized, the federal document said. But after the landowner refused to pay the graft, Omni stopped using the landowner's property, the complaint said. Prosecutors declined to directly answer questions about whether they believed Omni was complicit in the alleged scheme.
Reine declined to comment on the matter, citing the ongoing investigation. He said his company is not under scrutiny.
Subcontract awarded
Terrence Rice wound up with a subcontract from ECC when that firm took over New Orleans' prime debris-collection contract from Omni.
Allan Katz, a spokesman for ECC, said that Terrence Rice's company, T. Rice & Associates, had "performed several services for ECC and performed them well."
He did not say what the services were. Terrence Rice declined to answer questions about his work.
Another business owner who has also wound up with a lucrative subcontract from ECC, according to the firm, is Michael Sullivan, owner of TSG Solutions. Charles Rice has described Sullivan as a friend and occasional dinner companion. Sullivan won two subcontracts from city agencies during Rice's tenure as chief administrative officer, with deals netting TSG at least $1.3 million, according to city records. But Charles Rice said his friendship with Sullivan blossomed only after TSG firm received its city contracts.
Sullivan's resume says his firm's focus is "strategic planning, economic development and business development." Gambel, who is representing TSG as well as Omni, said TSG is mainly "doing debris hauling and solid-waste work." She added: "They've invested in a number of pieces of equipment to get the job done."
The company's work force now numbers about 40, Gambel said. She said that the work hews closely to TSG's mission of working in "construction-related fields."
Another well-known actor in political circles who has been retained by ECC is Bernard "Bunny" Charbonnet, a New Orleans Dock Board member and a leader of the political organization COUP.
Charbonnet, whose planning firm has offices in three states, said he initially received a contract worth up to about $500,000 to provide a project manager and about 10 other employees to oversee debris removal. He said he left the job after taking in about $100,000 because "it wasn't a good fit."
"It's nothing against ECC," Charbonnet said. "It just wasn't good for my company."
Subs tied to city
Some of the politically connected companies involved in the post-Katrina work have gotten work through The Shaw Group, which is the prime contractor for building inspections in New Orleans.
Shaw's major subcontractors include some companies well-known around City Hall. Among them: the engineering firms Three Fold Consultants, N-Y Associates and Citywide Testing and Inspection, the last one owned by Roy Glapion Jr., son of a late city councilman. All three firms have been active players in local politics, and Citywide and N-Y in particular have often been tapped for public contracts, public records show. All three companies have donated to Nagin's campaigns, with Three Fold giving a total of $6,000 and Citywide and N-Y Associates $10,000 apiece, state campaign finance records show.
Representatives of N-Y referred questions about their work to the Shaw Group. Officials from Three Fold and Citywide did not return phone calls.
The engineering firm Montgomery Watson Harza, which holds a contract for catch-basin cleaning and other debris-removal services, is also employing a familiar roster of subcontractors, including Three Fold and Citywide, and Sullivan's TSG.
It's unclear exactly how important connections to state or local politics are in the awarding of contracts or subcontracts. Officials at all levels have said that they seek the best deal they can get with a prime contractor, and then leave the hiring of subcontractors to that company.
And while elected officials have argued publicly that as much work as possible go to local firms, they say they don't lobby on behalf of particular ones.
Some degree of politics-as-usual is OK, Goyeneche said -- but there's a line that shouldn't be crossed.
"There's a tremendous push right now to see that local firms get more of this business," he said. "I'm sure they're contacting local political leaders to get those, and I'm sure they're using intermediaries to get that work.
"Should people not call on politicians and ask for favors? I don't believe that's the case. I think you can call on a friend to ask him to consider your firm, but don't go beyond that. You can't say, 'If you hire my firm, I'll do this for you.' "
. . . . . . .
Staff writers James Varney and Martha Carr contributed to this report. Gordon Russell can be reached at grussell@timespicayune.com or (504) 826-3347.
CORRECTION:
Shaw not among Fortune 500: A story in Sunday's editions identified The Shaw Group of Baton Rouge as a Fortune 500 company. While Shaw was listed as one of the nation's 500 largest companies in 2003 and 2004, the firm did not make the list in this year's rankings. (11/24/2005)
LOAD-DATE: November 26, 2005
It's not just Louisiana
Was Rice shown the door at City Hall? Times Picayune July 2, 2004
SECTION: METRO; NEW ORLEANS POLITICS; Pg. 1
LENGTH: 1003 words
HEADLINE: Was Rice shown the door at City Hall?;
ALSO: City Hall's revolving door; Power to the worker
BYLINE: By Gordon Russell and Frank Donze and Martha Carr, Staff writers
BODY:
The unanswered question about the departure this week of Charles Rice, the second chief administrative officer to resign during Mayor Ray Nagin's three years in office: Did he jump ship, or was he pushed?
Did Rice go because he was tired of the job's demands, wanted to spend more time with his kids, and had a tempting offer with a law firm on the table? Or did Nagin want Rice out?
The party line is that Rice's departure was completely voluntary, but the truth may be in the middle.
At Monday's news conference, Nagin warmly lauded Rice, a sharp contrast with the tepid sendoff he gave his first CAO, Kimberly Williamson Butler.
The mayor commended him for everything from pothole repairs to new parking meters -- and tried to put to rest any speculation about Rice being forced out.
"This was his decision," he said. "If he wanted, he could come back as CAO tomorrow."
Rice was similarly effusive. In a teary speech, he said he thinks of Nagin "as a brother."
But some people close to Nagin have suggested otherwise. They suggested a story like more like this: Nagin's most important political asset is integrity. Rice, while never accused of any malfeasance, was front and center on a few deals that emitted an odor of patronage -- among them the no-bid deal for trash cans that went to a company with ties to his brother -- leading to grumbling among certain aides and head-shaking from Nagin supporters.
Others say that Nagin didn't push Rice, but that his stock with the mayor had fallen -- and his influence with it. They say the power of an once-omnipotent office, , partially neutered in the Butler days, was further diminished by Nagin's recent tweaks to City Hall's contract-selection process, which shifted more power to the city attorney's office. Seeing the writing on the wall, Rice may have pursued an exit strategy.
But some Rice fans believe he had grown tired of taking the hits for the administration's decisions.
Another slice of the New Orleans political world -- not all of it Nagin-friendly -- saw Rice as a man who could be reasoned with, a breath of fresh air in an administration not always known for diplomacy.
"This is going to be the biggest void," Councilman Oliver Thomas said. "He was the go-to guy for the mayor."
. . . . . . .
SHRINKING CIRCLE: For several months, there has been talk that Nagin didn't want to see any more top aides leave before the February election.
But now Rice has left, adding to the long list of high-ranking advisers who have begged off before the close of the first term -- a number that dwarfs that of previous administrations.
Since Nagin took office, the departed include Butler, Economic Development Director Beth James, top political adviser Garey Forster and Communications Director Patrick Evans.
Of the original "inner circle," the only one left standing is Greg Meffert, chief technology officer -- a post that didn't exist when Nagin took office. Other high-ranking appointees still in the fold include top housing aide Alberta Pate, Executive Counsel Kenya Smith, Finance Director Reggie Zeno and City Attorney Sherry Landry, who took over that position for Rice when he became CAO.
By comparison, the top tier of former Mayor Marc Morial's administration remained nearly intact into his second term. And those who left did so because they had gotten an obvious promotion; political aide Paul Sens, for instance, left to run for the Municipal Court bench.
To some observers, the turnover suggests Nagin didn't do the greatest job of hiring top executives. But Nagin addressed those critics this week, saying that in the corporate world he came from, longevity is rare.
The mayor, who led Cox Communications of Louisiana before becoming mayor, said that he generally expected his top brass at Cox to move on to bigger and better things every couple of years. In staying three years, Rice exceeded his expectations, Nagin said.
. . . . . . .
END GAME: The unusual three-step process used to seat a city employee on the New Orleans Civil Service Commission has reached its final stage, and the decision is now in the hands of the City Council.
Council members have three weeks to choose from among the three top finishers in a recent balloting to winnow the five-candidate field. The three top finishers, selected by city employees in a runoff election, are: Jerry Davis, longtime personnel administrator for the Civil Service Department, 436 votes; Howard Eugene Noland, a support services administrator with the Sewerage & Water Board, 435; and police officer Neville Payne Sr., 320.
Eliminated were Recreation Department analyst Marie Henley and water board engineer Barham "Bob" Moeinian, who received 297 and 286 votes, respectively. The five finalists survived a first round of balloting that featured 10 contenders.
If the council takes no action, Davis, the top finisher, will be automatically appointed to the five-member board, which handles appeals of disciplinary actions against city employees and oversees City Hall's other personnel actions, from establishing wages to testing prospective workers.
City workers got the right to place one of their own on the panel in 1993. Before then, all members were chosen by the council from lists of nominees submitted by local universities. A seat was designated for a city employee after the closing of St. Mary's Dominican College.
While the other four commissioners receive a $50-per-meeting stipend, the employee representative gets no compensation other than time off from work to attend meetings. All commission members serve six-year terms.
The representative will replace Pamela Davis, compliance manager for the city's Neighborhood 1 housing program, who finished second in the 1999 election but was later picked by the council. Davis did not seek re-election.
LENGTH: 1003 words
HEADLINE: Was Rice shown the door at City Hall?;
ALSO: City Hall's revolving door; Power to the worker
BYLINE: By Gordon Russell and Frank Donze and Martha Carr, Staff writers
BODY:
The unanswered question about the departure this week of Charles Rice, the second chief administrative officer to resign during Mayor Ray Nagin's three years in office: Did he jump ship, or was he pushed?
Did Rice go because he was tired of the job's demands, wanted to spend more time with his kids, and had a tempting offer with a law firm on the table? Or did Nagin want Rice out?
The party line is that Rice's departure was completely voluntary, but the truth may be in the middle.
At Monday's news conference, Nagin warmly lauded Rice, a sharp contrast with the tepid sendoff he gave his first CAO, Kimberly Williamson Butler.
The mayor commended him for everything from pothole repairs to new parking meters -- and tried to put to rest any speculation about Rice being forced out.
"This was his decision," he said. "If he wanted, he could come back as CAO tomorrow."
Rice was similarly effusive. In a teary speech, he said he thinks of Nagin "as a brother."
But some people close to Nagin have suggested otherwise. They suggested a story like more like this: Nagin's most important political asset is integrity. Rice, while never accused of any malfeasance, was front and center on a few deals that emitted an odor of patronage -- among them the no-bid deal for trash cans that went to a company with ties to his brother -- leading to grumbling among certain aides and head-shaking from Nagin supporters.
Others say that Nagin didn't push Rice, but that his stock with the mayor had fallen -- and his influence with it. They say the power of an once-omnipotent office, , partially neutered in the Butler days, was further diminished by Nagin's recent tweaks to City Hall's contract-selection process, which shifted more power to the city attorney's office. Seeing the writing on the wall, Rice may have pursued an exit strategy.
But some Rice fans believe he had grown tired of taking the hits for the administration's decisions.
Another slice of the New Orleans political world -- not all of it Nagin-friendly -- saw Rice as a man who could be reasoned with, a breath of fresh air in an administration not always known for diplomacy.
"This is going to be the biggest void," Councilman Oliver Thomas said. "He was the go-to guy for the mayor."
. . . . . . .
SHRINKING CIRCLE: For several months, there has been talk that Nagin didn't want to see any more top aides leave before the February election.
But now Rice has left, adding to the long list of high-ranking advisers who have begged off before the close of the first term -- a number that dwarfs that of previous administrations.
Since Nagin took office, the departed include Butler, Economic Development Director Beth James, top political adviser Garey Forster and Communications Director Patrick Evans.
Of the original "inner circle," the only one left standing is Greg Meffert, chief technology officer -- a post that didn't exist when Nagin took office. Other high-ranking appointees still in the fold include top housing aide Alberta Pate, Executive Counsel Kenya Smith, Finance Director Reggie Zeno and City Attorney Sherry Landry, who took over that position for Rice when he became CAO.
By comparison, the top tier of former Mayor Marc Morial's administration remained nearly intact into his second term. And those who left did so because they had gotten an obvious promotion; political aide Paul Sens, for instance, left to run for the Municipal Court bench.
To some observers, the turnover suggests Nagin didn't do the greatest job of hiring top executives. But Nagin addressed those critics this week, saying that in the corporate world he came from, longevity is rare.
The mayor, who led Cox Communications of Louisiana before becoming mayor, said that he generally expected his top brass at Cox to move on to bigger and better things every couple of years. In staying three years, Rice exceeded his expectations, Nagin said.
. . . . . . .
END GAME: The unusual three-step process used to seat a city employee on the New Orleans Civil Service Commission has reached its final stage, and the decision is now in the hands of the City Council.
Council members have three weeks to choose from among the three top finishers in a recent balloting to winnow the five-candidate field. The three top finishers, selected by city employees in a runoff election, are: Jerry Davis, longtime personnel administrator for the Civil Service Department, 436 votes; Howard Eugene Noland, a support services administrator with the Sewerage & Water Board, 435; and police officer Neville Payne Sr., 320.
Eliminated were Recreation Department analyst Marie Henley and water board engineer Barham "Bob" Moeinian, who received 297 and 286 votes, respectively. The five finalists survived a first round of balloting that featured 10 contenders.
If the council takes no action, Davis, the top finisher, will be automatically appointed to the five-member board, which handles appeals of disciplinary actions against city employees and oversees City Hall's other personnel actions, from establishing wages to testing prospective workers.
City workers got the right to place one of their own on the panel in 1993. Before then, all members were chosen by the council from lists of nominees submitted by local universities. A seat was designated for a city employee after the closing of St. Mary's Dominican College.
While the other four commissioners receive a $50-per-meeting stipend, the employee representative gets no compensation other than time off from work to attend meetings. All commission members serve six-year terms.
The representative will replace Pamela Davis, compliance manager for the city's Neighborhood 1 housing program, who finished second in the 1999 election but was later picked by the council. Davis did not seek re-election.
Saturday, March 24, 2007
Parking Meters -- Times Picayune Editorial April 30, 2005
Copyright 2005 The Times-Picayune Publishing Company
Times-Picayune (New Orleans)
April 30, 2005 Saturday
SECTION: METRO - EDITORIAL; Pg. 6
LENGTH: 229 words
HEADLINE: The best thing ever
BODY:
If only New Orleanians had known the import of the new parking meters sprouting up around the city, they might have demanded them sooner.
Charles Rice, Mayor Ray Nagin's chief administrative officer, put things in perspective this week.
In response to criticism from French Quarter residents about the appearance of the meters and the way parking rules are being enforced, Mr. Rice spoke in sweeping terms.
Not only are the credit card-ready meters more convenient, they will also "bring New Orleans into the 21st century," he said.
Pause for dramatic effect.
"So we can compete with the Atlantas and the Houstons."
New Orleanians surely would be happy to compete with the Atlantas and the Houstons for economic development. Those cities are among the most vibrant in the South, and the New Orleans area has lost some well-paying jobs to Houston.
But who knew that updated parking meters could help with job creation? Obviously, the company supplying the meters will benefit, and so will the people paid to hand out tickets. And maybe, instead of spending all their time looking for quarters, people will have more time for genetic engineering and aerospace research.
Or maybe Mr. Rice is trying to make the meters seem so fabulous in the hope that residents will forget that the city paid too much for them and gave the contract to a politically connected supplier.
Good luck with that.
Times-Picayune (New Orleans)
April 30, 2005 Saturday
SECTION: METRO - EDITORIAL; Pg. 6
LENGTH: 229 words
HEADLINE: The best thing ever
BODY:
If only New Orleanians had known the import of the new parking meters sprouting up around the city, they might have demanded them sooner.
Charles Rice, Mayor Ray Nagin's chief administrative officer, put things in perspective this week.
In response to criticism from French Quarter residents about the appearance of the meters and the way parking rules are being enforced, Mr. Rice spoke in sweeping terms.
Not only are the credit card-ready meters more convenient, they will also "bring New Orleans into the 21st century," he said.
Pause for dramatic effect.
"So we can compete with the Atlantas and the Houstons."
New Orleanians surely would be happy to compete with the Atlantas and the Houstons for economic development. Those cities are among the most vibrant in the South, and the New Orleans area has lost some well-paying jobs to Houston.
But who knew that updated parking meters could help with job creation? Obviously, the company supplying the meters will benefit, and so will the people paid to hand out tickets. And maybe, instead of spending all their time looking for quarters, people will have more time for genetic engineering and aerospace research.
Or maybe Mr. Rice is trying to make the meters seem so fabulous in the hope that residents will forget that the city paid too much for them and gave the contract to a politically connected supplier.
Good luck with that.
Friday, March 23, 2007
Garbage Cans, Charles Rice -- Times Picayune Nov. 7, 2004
November 7, 2004 Sunday
SECTION: NATIONAL; Pg. 1
LENGTH: 2064 words
HEADLINE: Trash bin contract smells, some say;
No-bid deal in N.O. raises questions
BYLINE: By Gordon Russell, Staff writer
BODY:
A no-bid deal that gives a New Orleans firm the exclusive right to sell advertising on hundreds of city-owned trash cans in the Central Business District has raised eyebrows among others in the industry, who wonder why they weren't given a chance to compete for the potentially lucrative job.
Moreover, the company selling the ads and supplying the cans, Niche Marketing USA, had a business relationship with Terrence Rice, the brother of New Orleans Chief Administrative Officer Charles Rice, at the time the deal was announced, according to the company president. The company's chief executive later denied that Terrence Rice had worked with Niche.
City officials have been tight-lipped about the deal, refusing on numerous occasions during the past three months to answer basic questions about it. They say they have no paperwork on the arrangement because it is technically a subcontract between Niche Marketing and Waste Management, the city's trash collector, which buys the receptacles, known as "Jazzy Cans," from Niche at the city's direction.
The Nagin administration's reluctance to provide details on the matter has been unusual, given the aggressive stance the mayor has taken against patronage and in favor of transparency in the awarding of city contracts.
According to Charles Rice, Niche representatives had demonstrated the cans, purported to be bombproof, to him and other city officials. Along with the antiterrorism feature, the cans also contain four panels to display advertising.
City officials were impressed, Rice said, and so far have ordered Waste Management to buy 600 from Niche Marketing, using money donated by private companies to the mayor's "Imagine It Clean" campaign. The cans, which are not manufactured by Niche, cost $750 apiece, for a total of $450,000, Rice said.
Though the cans belong to the city, Rice said the city has no written agreement or contract with Niche Marketing on the company's exclusive franchise to sell advertising on them. However, he said the city does have a letter in which Niche promises to give 15 percent of its ad revenue to the city.
City officials have yet to provide the letter to The Times-Picayune, though the newspaper submitted a public-records request in August asking for all contracts and agreements between the city and the company. City officials also did not respond to a request for information about how much revenue the city has earned from the arrangement. Relatively few ads appear to have been sold so far.
Mixed messages
Charles Rice declined to directly answer questions about whether his brother had a relationship with Niche Marketing.
"That's something you would have to ask my brother about," Charles Rice said. "But I think you've spoken to Niche, and I think they've given you that answer."
Terrence Rice has not responded to numerous e-mails and phone messages.
Shortly after the cans were unveiled at a Nagin news conference in July, a receptionist at Niche Marketing answered a reporter's call asking for Terrence Rice by saying she would take a message for him.
In a later conversation, company President Stacey Mays-Douglas said Terrence Rice "no longer works here."
When asked what job Rice had performed, Mays-Douglas answered: "He was simply selling advertising. His goal was to sell ads on the Jazzy Cans."
Not long afterward, Kerry Brown, the firm's attorney, called The Times-Picayune and said Mays-Douglas "may have been mistaken." He said Terrence Rice "had been utilizing office space" leased by Niche but "has not received a penny from Niche."
He added that "there is no employer-employee relationship" between the company and Terrence Rice, and that Rice "has not received a paycheck, directly or indirectly." Brown described Rice as a "jack-of-all-trades."
Later, Niche CEO Rodney Whitney, who founded the firm, categorically and vehemently denied that Rice had any ties to the company.
"Terrence Rice has no relationship with Niche. He has never had a relationship with Niche," Whitney said.
Asked why the company's No. 2 official had said otherwise, Whitney said: "I don't know why she told you that. Evidently, you weren't talking to the right person."
'Imagine It Clean'
When asked why the city did not go through a bid process or a request for proposals to buy the new cans or to select an advertising vendor, Rice said a bid process was unnecessary and would have been unfair to Niche. He said the city's contract with Waste Management allows the city to direct the trash hauler to buy garbage cans and does not require a bid process.
The money for the cans came from the "Imagine It Clean" campaign, which Nagin's press office describes as a public-private initiative. Money for the effort had been donated by private companies, including $150,000 from Harrah's and $50,000 apiece from Waste Management and from Browning-Ferris International, another major trash hauler.
Technically, Waste Management has bought the cans at the city's direction, and then been reimbursed by the city, Rice said. A similar process was used for 508 new cans, costing $675 apiece, in the French Quarter and along St. Charles Avenue.
Waste Management bought those cans through Celtic Distributors, a company run by James "Dutchie" Connick, who is a lobbyist for Waste Management and also is the brother of Jefferson Parish District Attorney Paul Connick Jr. In that case, city officials apparently did not order Waste Management to buy cans from a specific vendor.
Rice added that when Marc Morial was mayor, the city was buying cans through Waste Management that cost $1,000 apiece, so the new cans represent a substantial savings.
Chuck Dees, area vice president for Waste Management, said his company had purchased a large number of concrete-based cans, adorned with the "Mayor's Clean Team" logo, for $490 apiece through Dutchie Connick. The company also bought a smaller number of fancier cans for the French Quarter at $840 apiece under the direction of the Morial administration, Dees said.
The Nagin administration did not respond to questions about which cans cost $1,000 apiece.
Lawsuit against Niche
When asked if a bid process might have resulted in a better price, Rice said he wanted the cans marketed by Niche, which he said embodied "patented technology" making them bombproof. Niche is the exclusive distributor of such cans in Louisiana, he said.
Rice said he took Niche officials at their word that they were the sole providers of such cans. Niche also "showed me a patent," Rice said, though the company's attorney said Niche has yet to receive a patent.
Rice said it would have been unfair to seek bids to select an advertising vendor because the idea of putting ads on trash cans was Niche's.
"Look at this realistically," Rice said. "If you brought me an idea, would it be fair for me to steal it and profit from it? This was their idea."
However, a federal lawsuit against Niche filed last month by City Media Concepts, a company based in New York City, alleges that Niche parroted the design and concept of City Media Concepts, which has placed similar cans in Times Square.
The suit claims a violation of City Media's "trade dress" and trademark. In a nutshell, that means that the company has pioneered a trash can with a certain look and features, much in the way that McDonald's restaurants have certain looks and features, said Andy Langsam, City Media's attorney.
"You and I could not open a hamburger chain and call it McDougal's," Langsam said. "Or, if we called it Sam and Andy's, but it had golden arches, they'd stop us, too."
The suit asks the court to seize all litter cans provided by Niche and to order the company to change its design.
As evidence for its claim, City Media pointed to Niche's Web site, which used language strikingly similar to that used by City Media to pitch its product.
In a letter to Niche, Langsam demanded changes to the site owing to its "blatantly copied portions of our client's copyrighted materials."
As an example, the letter noted that City Media's Web site described its cans this way: "Crafted of heavy steel and weighing over 325 pounds, the Receptasign kiosk's sleek frame houses an outsized 45-gallon container that discreetly hides greater quantities of unsightly refuse."
Niche's site until recently described its cans like this: "Crafted of heavy metal and cement weighing more than 900 pounds, 'Jazzy Cans' have a 39.9 gallon container area, and a dome top that discreetly covers large quantities of unsightly refuse."
Said Langsam: "That told us that they knew of us, they copied us, this wasn't accidental."
Redesigned
Niche's Web site was redesigned shortly after the company received the letter from Langsam. Kerry Brown, the firm's attorney, said he suggested the changes after receiving the letter because he always advises clients to try to work out disagreements amicably rather than get bogged down in costly litigation.
"I want to get rid of any and all possibility that we did something wrong, because we didn't," he said.
Brown said the suit is baseless and promised that it will be dismissed within a week. He said Niche's cans differ substantially from City Media's because they are bombproof rather than bomb-resistant. He said the company has applied for but not yet received a patent.
"City Media does not have a mitigating can, a can that's capable of absorbing explosions," Brown said. "That's what Niche brought to the city. And City Media didn't see that."
Brown said he and Langsam had already agreed in principle to a settlement that essentially would involve City Media dropping the case. He said he couldn't discuss the exact terms.
But Langsam gave a different version. He said Brown had called him, explained that Niche, which was sued in federal court in North Carolina earlier this year in an unrelated action, could not afford to defend another suit. Brown wanted to discuss a settlement, Langsam said.
Langsam said he agreed to drop the claim only if Niche either agrees to remove all the trash cans from New Orleans' streets within two months, or pays City Media a licensing fee for each one. He would not disclose an amount.
Brown said he disagreed with Langsam's version of events but declined to offer his own.
"He's not going to get what he's asking for," Brown said.
Other companies irked
City Media is not the only company taken aback at the appearance of Jazzy Cans on New Orleans' streets.
Representatives of several companies that produce and sell display advertising said they would have welcomed a chance to bid for the right to sell ads on the garbage cans, but there was apparently no bid process to purchase the cans or sell advertising space on them.
"We did not receive an RFP (request for proposals) or anything," said Jodi Senese, a spokeswoman for Viacom, a major player in the outdoor advertising market.
Asked whether the company would have bid given the chance, Senese said: "It's in line with our business. It is an out-of-home advertising product, and we're in the out-of-home advertising business. We would have evaluated it and made a decision based on that."
Several other companies in the outdoor advertising business said they, too, would have welcomed a chance to compete. But none wanted to speak on the record for fear of hurting their chances of getting future city business.
It's possible the city could have gotten a better deal had it sought bids for the job.
Peter Arbor, vice president of operations for City Media, characterized Niche's arrangement in New Orleans as a sweetheart deal.
City Media pays for the cans it provides in New York, Arbor said, and also continues to own and maintain them around the clock, with crews that come out hourly to wipe the cans off so the advertising remains visible. That's not cheap, he said.
City Media shares 10 percent of its ad revenue with New York City, he said.
By comparison, New Orleans must buy and maintain the cans Niche provides. And although the city gets 15 percent of the ad revenue, the extra 5 percent doesn't nearly cover the other costs, Arbor said.
"It appears on the surface that it's a very good deal for Niche," Arbor said.
But Brown said Niche's cans are of far better quality and thus far more expensive than City Media's. Also, it's unfair to compare the advertising markets in New Orleans and New York City.
"They get tons more for advertising," he said. "You're comparing Times Square to Poydras Street."
. . . . . . .
SECTION: NATIONAL; Pg. 1
LENGTH: 2064 words
HEADLINE: Trash bin contract smells, some say;
No-bid deal in N.O. raises questions
BYLINE: By Gordon Russell, Staff writer
BODY:
A no-bid deal that gives a New Orleans firm the exclusive right to sell advertising on hundreds of city-owned trash cans in the Central Business District has raised eyebrows among others in the industry, who wonder why they weren't given a chance to compete for the potentially lucrative job.
Moreover, the company selling the ads and supplying the cans, Niche Marketing USA, had a business relationship with Terrence Rice, the brother of New Orleans Chief Administrative Officer Charles Rice, at the time the deal was announced, according to the company president. The company's chief executive later denied that Terrence Rice had worked with Niche.
City officials have been tight-lipped about the deal, refusing on numerous occasions during the past three months to answer basic questions about it. They say they have no paperwork on the arrangement because it is technically a subcontract between Niche Marketing and Waste Management, the city's trash collector, which buys the receptacles, known as "Jazzy Cans," from Niche at the city's direction.
The Nagin administration's reluctance to provide details on the matter has been unusual, given the aggressive stance the mayor has taken against patronage and in favor of transparency in the awarding of city contracts.
According to Charles Rice, Niche representatives had demonstrated the cans, purported to be bombproof, to him and other city officials. Along with the antiterrorism feature, the cans also contain four panels to display advertising.
City officials were impressed, Rice said, and so far have ordered Waste Management to buy 600 from Niche Marketing, using money donated by private companies to the mayor's "Imagine It Clean" campaign. The cans, which are not manufactured by Niche, cost $750 apiece, for a total of $450,000, Rice said.
Though the cans belong to the city, Rice said the city has no written agreement or contract with Niche Marketing on the company's exclusive franchise to sell advertising on them. However, he said the city does have a letter in which Niche promises to give 15 percent of its ad revenue to the city.
City officials have yet to provide the letter to The Times-Picayune, though the newspaper submitted a public-records request in August asking for all contracts and agreements between the city and the company. City officials also did not respond to a request for information about how much revenue the city has earned from the arrangement. Relatively few ads appear to have been sold so far.
Mixed messages
Charles Rice declined to directly answer questions about whether his brother had a relationship with Niche Marketing.
"That's something you would have to ask my brother about," Charles Rice said. "But I think you've spoken to Niche, and I think they've given you that answer."
Terrence Rice has not responded to numerous e-mails and phone messages.
Shortly after the cans were unveiled at a Nagin news conference in July, a receptionist at Niche Marketing answered a reporter's call asking for Terrence Rice by saying she would take a message for him.
In a later conversation, company President Stacey Mays-Douglas said Terrence Rice "no longer works here."
When asked what job Rice had performed, Mays-Douglas answered: "He was simply selling advertising. His goal was to sell ads on the Jazzy Cans."
Not long afterward, Kerry Brown, the firm's attorney, called The Times-Picayune and said Mays-Douglas "may have been mistaken." He said Terrence Rice "had been utilizing office space" leased by Niche but "has not received a penny from Niche."
He added that "there is no employer-employee relationship" between the company and Terrence Rice, and that Rice "has not received a paycheck, directly or indirectly." Brown described Rice as a "jack-of-all-trades."
Later, Niche CEO Rodney Whitney, who founded the firm, categorically and vehemently denied that Rice had any ties to the company.
"Terrence Rice has no relationship with Niche. He has never had a relationship with Niche," Whitney said.
Asked why the company's No. 2 official had said otherwise, Whitney said: "I don't know why she told you that. Evidently, you weren't talking to the right person."
'Imagine It Clean'
When asked why the city did not go through a bid process or a request for proposals to buy the new cans or to select an advertising vendor, Rice said a bid process was unnecessary and would have been unfair to Niche. He said the city's contract with Waste Management allows the city to direct the trash hauler to buy garbage cans and does not require a bid process.
The money for the cans came from the "Imagine It Clean" campaign, which Nagin's press office describes as a public-private initiative. Money for the effort had been donated by private companies, including $150,000 from Harrah's and $50,000 apiece from Waste Management and from Browning-Ferris International, another major trash hauler.
Technically, Waste Management has bought the cans at the city's direction, and then been reimbursed by the city, Rice said. A similar process was used for 508 new cans, costing $675 apiece, in the French Quarter and along St. Charles Avenue.
Waste Management bought those cans through Celtic Distributors, a company run by James "Dutchie" Connick, who is a lobbyist for Waste Management and also is the brother of Jefferson Parish District Attorney Paul Connick Jr. In that case, city officials apparently did not order Waste Management to buy cans from a specific vendor.
Rice added that when Marc Morial was mayor, the city was buying cans through Waste Management that cost $1,000 apiece, so the new cans represent a substantial savings.
Chuck Dees, area vice president for Waste Management, said his company had purchased a large number of concrete-based cans, adorned with the "Mayor's Clean Team" logo, for $490 apiece through Dutchie Connick. The company also bought a smaller number of fancier cans for the French Quarter at $840 apiece under the direction of the Morial administration, Dees said.
The Nagin administration did not respond to questions about which cans cost $1,000 apiece.
Lawsuit against Niche
When asked if a bid process might have resulted in a better price, Rice said he wanted the cans marketed by Niche, which he said embodied "patented technology" making them bombproof. Niche is the exclusive distributor of such cans in Louisiana, he said.
Rice said he took Niche officials at their word that they were the sole providers of such cans. Niche also "showed me a patent," Rice said, though the company's attorney said Niche has yet to receive a patent.
Rice said it would have been unfair to seek bids to select an advertising vendor because the idea of putting ads on trash cans was Niche's.
"Look at this realistically," Rice said. "If you brought me an idea, would it be fair for me to steal it and profit from it? This was their idea."
However, a federal lawsuit against Niche filed last month by City Media Concepts, a company based in New York City, alleges that Niche parroted the design and concept of City Media Concepts, which has placed similar cans in Times Square.
The suit claims a violation of City Media's "trade dress" and trademark. In a nutshell, that means that the company has pioneered a trash can with a certain look and features, much in the way that McDonald's restaurants have certain looks and features, said Andy Langsam, City Media's attorney.
"You and I could not open a hamburger chain and call it McDougal's," Langsam said. "Or, if we called it Sam and Andy's, but it had golden arches, they'd stop us, too."
The suit asks the court to seize all litter cans provided by Niche and to order the company to change its design.
As evidence for its claim, City Media pointed to Niche's Web site, which used language strikingly similar to that used by City Media to pitch its product.
In a letter to Niche, Langsam demanded changes to the site owing to its "blatantly copied portions of our client's copyrighted materials."
As an example, the letter noted that City Media's Web site described its cans this way: "Crafted of heavy steel and weighing over 325 pounds, the Receptasign kiosk's sleek frame houses an outsized 45-gallon container that discreetly hides greater quantities of unsightly refuse."
Niche's site until recently described its cans like this: "Crafted of heavy metal and cement weighing more than 900 pounds, 'Jazzy Cans' have a 39.9 gallon container area, and a dome top that discreetly covers large quantities of unsightly refuse."
Said Langsam: "That told us that they knew of us, they copied us, this wasn't accidental."
Redesigned
Niche's Web site was redesigned shortly after the company received the letter from Langsam. Kerry Brown, the firm's attorney, said he suggested the changes after receiving the letter because he always advises clients to try to work out disagreements amicably rather than get bogged down in costly litigation.
"I want to get rid of any and all possibility that we did something wrong, because we didn't," he said.
Brown said the suit is baseless and promised that it will be dismissed within a week. He said Niche's cans differ substantially from City Media's because they are bombproof rather than bomb-resistant. He said the company has applied for but not yet received a patent.
"City Media does not have a mitigating can, a can that's capable of absorbing explosions," Brown said. "That's what Niche brought to the city. And City Media didn't see that."
Brown said he and Langsam had already agreed in principle to a settlement that essentially would involve City Media dropping the case. He said he couldn't discuss the exact terms.
But Langsam gave a different version. He said Brown had called him, explained that Niche, which was sued in federal court in North Carolina earlier this year in an unrelated action, could not afford to defend another suit. Brown wanted to discuss a settlement, Langsam said.
Langsam said he agreed to drop the claim only if Niche either agrees to remove all the trash cans from New Orleans' streets within two months, or pays City Media a licensing fee for each one. He would not disclose an amount.
Brown said he disagreed with Langsam's version of events but declined to offer his own.
"He's not going to get what he's asking for," Brown said.
Other companies irked
City Media is not the only company taken aback at the appearance of Jazzy Cans on New Orleans' streets.
Representatives of several companies that produce and sell display advertising said they would have welcomed a chance to bid for the right to sell ads on the garbage cans, but there was apparently no bid process to purchase the cans or sell advertising space on them.
"We did not receive an RFP (request for proposals) or anything," said Jodi Senese, a spokeswoman for Viacom, a major player in the outdoor advertising market.
Asked whether the company would have bid given the chance, Senese said: "It's in line with our business. It is an out-of-home advertising product, and we're in the out-of-home advertising business. We would have evaluated it and made a decision based on that."
Several other companies in the outdoor advertising business said they, too, would have welcomed a chance to compete. But none wanted to speak on the record for fear of hurting their chances of getting future city business.
It's possible the city could have gotten a better deal had it sought bids for the job.
Peter Arbor, vice president of operations for City Media, characterized Niche's arrangement in New Orleans as a sweetheart deal.
City Media pays for the cans it provides in New York, Arbor said, and also continues to own and maintain them around the clock, with crews that come out hourly to wipe the cans off so the advertising remains visible. That's not cheap, he said.
City Media shares 10 percent of its ad revenue with New York City, he said.
By comparison, New Orleans must buy and maintain the cans Niche provides. And although the city gets 15 percent of the ad revenue, the extra 5 percent doesn't nearly cover the other costs, Arbor said.
"It appears on the surface that it's a very good deal for Niche," Arbor said.
But Brown said Niche's cans are of far better quality and thus far more expensive than City Media's. Also, it's unfair to compare the advertising markets in New Orleans and New York City.
"They get tons more for advertising," he said. "You're comparing Times Square to Poydras Street."
. . . . . . .
Garbage Cans, Rice -- Times Picayune Jan. 18, 2005
January 18, 2005 Tuesday
Correction Appended
SECTION: NATIONAL; Pg. 1
LENGTH: 2204 words
HEADLINE: City's trash bin contract called wasteful;
Other firms say they can do more for less
BYLINE: By Gordon Russell, Staff writer
BODY:
As part of a no-bid deal with a local advertising company that enjoys close ties to the Nagin administration, the city of New Orleans paid $450,000 for garbage cans similar to those that competing businesses routinely provide for free.
Representatives of at least three companies that sell advertising on trash cans like those now dotting the streets of New Orleans say they would have been eager to provide the cans at no cost in exchange for the right to sell the ads that go in panels on the four-sided bins. To boot, two of the three said they also would have given the city a bigger piece of the ad revenue than the 15 percent the city is getting from the company that got the deal, Niche Marketing USA.
Nagin's chief administrative officer, Charles Rice, defended the city's decision to buy the cans, saying among other things that bidding would have been unfair to Niche, which he said submitted to the city the idea of advertising on cans.
But one of the three companies that said it would have provided the cans for free, Verres Media, submitted a proposal about two years ago that mentioned its ability to provide cans with advertising. At the time, however, the city was looking for a wide-ranging branding and marketing strategy, not trash cans, and the bid was overlooked.
Had the city gone out to bid on the trash cans, Verres officials said they would have resubmitted their previous offer, which would have saved the city $450,000 up front, and likely generated more money down the road.
And had the city entertained bids other than the one from Niche Marketing, it also would have heard from Eyeball Media, based in Atlanta, according to that firm's president, Richard Mashburn, who called Niche's contract "a sweetheart deal."
Eyeball provides similar cans with advertising to the city of Atlanta as well as private businesses. The company pays for the cans, maintains them and shares anywhere from 15 percent to 25 percent of the ad revenue with the client. Typically, cities get 25 percent, Mashburn said.
Mashburn, who checked out Niche's cans on a recent trip to New Orleans, said he intends to send a letter to city officials offering to help sell ads and giving the city a 25 percent cut.
"The way I look at it, the more the merrier," Mashburn said. "We would love the opportunity to come down there and sell."
City Media Concepts, a firm based in New York City that makes advertising cans similar to those the city bought from Niche, also provides and maintains similar receptacles at no cost. The firm typically shares 10 percent of its revenue.
Better terms from other vendors isn't the only problem rivals are finding with the Niche deal. City Media filed a federal lawsuit against Niche in October alleging that Niche's cans parroted City Media's design and concept. The suit says City Media's "trade dress" and trademark have been violated -- in essence, that Niche appropriated a trash can with a certain look and features that were pioneered by City Media.
The suit asks the court to seize all litter cans provided by Niche and to order the company to change its design.
City Media officials have said they would allow Niche to keep its cans on the street if the company paid an unspecified licensing fee. Niche officials have countered that the case has no merit. No trial date has been set.
Instead of conducting a bid process, the city opted to deal exclusively with Niche, which has ties to the brother of Chief Administrative Officer Charles Rice as well as to a lawyer who worked for Rice when he was city attorney.
Not only has the city paid for the cans -- which, at $750 a pop, have cost a total of $450,000 -- but Niche is forking over only 15 percent of the revenue from its sales, which so far have been less than brisk.
The city recently received the first of the royalty checks that are supposed to arrive twice a year. The total: $5,969. At the current pace, it will take the city 38 years to recoup its investment.
It is unknown how many ads the company sold to make that figure. Niche Chief Executive Officer Rodney Whitney refused to answer questions, but sales appear very slow: It is difficult to find any ads that are not "house ads": those that promote cleanliness, a donor to the "Imagine It Clean" campaign or Niche itself.
In Atlanta, Mashburn said he has been able to fill 63 percent of his ad space in nine months. If his company had access to the 600 cans in New Orleans and was able to sell ads at similar rates and at a similar pace, New Orleans would receive a check totaling almost $100,000 every six months.
Mashburn also noted that the city's decision to finance the purchase of the cans may have contributed to the slow pace of sales because Niche isn't on the hook for any real costs.
"If everything's coming out of your own pocket, you've got a real incentive to sell," Mashburn said. "Otherwise, you die."
When Christian Nardi of Verres Media saw the new trash cans popping up all over downtown New Orleans, he got a queasy feeling. That was my idea, he thought. When he learned about the terms the city had settled on, the queasiness turned to anger.
"I thought I got the shaft," Nardi said. "I felt like all the work I did on the proposal was for the city to take my idea and give it to someone else."
Verres' proposal, presented in early 2003 in response to a call by the Nagin administration for marketing ideas, centered on "traffic channelers," barricades with advertising used in airports and on outdoor walkways to steer pedestrians.
The process drew five responses, none of which the city pursued.
Verres' proposal also featured a picture of a trash can with four ad panels similar to those the city began buying from Niche last summer, and noted that the company could provide them as well.
Nardi said he made clear to city officials that the cans would be made available to the city under the same terms he offered for the traffic channelers. His terms: Give the cans to the city for free, maintain them and give the city 40 percent of the revenue from ad sales.
Nardi said he and an uncle who is his business partner "were both in awe of the idea that teachers are buying their own paper and books for students, and meanwhile the city is spending $750 apiece on trash cans that we offered the city for free."
But officials in the Nagin administration vigorously dispute elements of Nardi's account. In particular, they say, Nardi emphasized channelers, not trash cans, and that he never explained in writing the terms under which he could provide the cans.
"I read through every one of those proposals in exhaustive detail, and I would never remember he presented trash cans," said marketing director Matt Konigsmark, who coordinated the request for proposals for branding ideas. Konigsmark was not involved in last year's procurement of the trash cans.
"It is clearly an afterthought," Konigsmark added. "This whole proposal is focused on channelers, and then there's one page that said, 'Oh, by the way, we can do this.' There are 20 pages in the book, and 19 of them were on the channelers."
A review of the document shows that the garbage cans are indeed mentioned only in passing. The proposal also does not state that the financial terms would be the same as for the channelers.
But Nardi said he mentioned the garbage cans when he delivered the document to Konigsmark and made clear that the same terms would apply. Konigsmark said he does not recall such a conversation, and that even if it occurred, the members of the evaluation committee, which included Rice, would have relied on the written proposal to make its decisions.
"I certainly wasn't aware of the financial aspects of it," Konigsmark said. "He may have been willing to do it on those terms, but he didn't make that clear."
Konigsmark added that he read certain aspects of Nardi's proposal to mean that the city would have to help the company sell ads. "We're not really staffed to do that," he said.
Nardi said he was never expecting that kind of help. Rather, he wanted the city to assist in smaller ways, such as giving the company a letter it could use when soliciting potential customers.
"We wanted an endorsement," Nardi said. "We wanted their contacts, not for them to help us sell."
Rice has publicly defended the decision not to seek a better deal for the city through competitive bidding. After all, he said, the idea of trash cans with advertising on them occurred to him only because Niche representatives gave him and other city officials a demonstration of the cans, purported to be "bombproof."
In fact, that anti-terrorism feature makes the cans different from the cans that Niche's competitors offer for free, Rice said through a spokeswoman. But even if Niche's cans cost more than others, many of which claim only to be "bomb-
resistant," Niche's deal is unusual in that the company was not required to spend any money up front.
Rice said he was impressed with the cans and decided to have the city's trash collector, Waste Management, buy 600 of them, to be reimbursed by the city.
The pass-through arrangement freed Rice from having to follow public bid laws. Though he could have conducted one anyway, he said a bid process would have been unfair to Niche.
"Look at this realistically," Rice said in a November interview. "If you brought me an idea, would it be fair for me to steal it and profit from it? This was their idea."
Last week, Rice took a slightly different tack, saying his decision to deal with Niche -- which is owned by an African-American, Whitney -- stemmed from a desire to fulfill the mayor's goal of nurturing minority-owned businesses.
"The mayor stated he wanted to increase and build the African-American middle class and to increase African-American entrepreneurship," Rice said. "This was a young, energetic African-American company, and in keeping with the mayor's vision, we decided to work with them."
But though Rice said the city's dealings with Niche are purely about promoting black business development, there are close connections between Rice and people affiliated with the company.
Terrence Rice, Charles Rice's brother, was working for the firm when the deal was announced, the company president said at the time. The company's chief executive later denied that Terrence Rice had worked with Niche.
Terrence Rice has not responded to questions about his relationship with the company. Charles Rice, meanwhile, refused to take questions on the matter, referring them to his brother and company officials.
In addition, Bobby Smith, whom Charles Rice hired as an assistant city attorney shortly after his own installation as city attorney in 2002, left City Hall in March 2004 and now works for Niche Marketing.
Smith's departure from City Hall, where he was earning $61,000, came about three weeks after Niche Marketing was incorporated, according to state records.
Nagin spokeswoman Tami Frazier said Rice was unaware of Smith's relationship with Niche. She also noted that Rice was not city attorney at the time of Smith's departure and said Rice had not kept track of him.
Asked whether he thought the purchase was a good one, Nagin said: "When I reviewed this transaction many months ago it looked like a good deal to me. I also recall this program being funded by private dollars. I have no other comments since I have not looked into the specifics in quite some time."
In fact, half the money spent on the cans came directly from the city's coffers. The other half came from the "Imagine It Clean" fund, which received large contributions from city contractors Waste Management, Browning-Ferris Industries and Harrah's New Orleans. The money was spent at the city's discretion.
The controversy about the cans goes beyond whether the deal was a cozy one. Some New Orleanians also are offended by the cans themselves.
City Councilwoman Jacquelyn Brechtel Clarkson, who represents the French Quarter and is generally a staunch ally of Nagin, wrote Sanitation Director Veronica White a letter in November asking that the so-
called "Jazzy Cans" be removed from the Quarter. Clarkson said she had received several complaints about the commercial cans.
White responded that the cans "represent part of the Mayor's 'Imagine it Clean' campaign and as such it is not at my discretion to remove them without his authority." White said she would forward Clarkson's request to the mayor.
Clarkson said she had not heard back from the mayor and doesn't expect to. "He has more important things to do," she said.
Clarkson's efforts were cheered by some Quarter activists who said the cans are out of place, only more so since they are often placed near ad-free trash cans that were hailed at the time of their installation, just a few years ago, for being good-looking receptacles adorned only with a fleur-de-lis.
Nathan Chapman, president of the French Quarter neighborhood group Vieux Carre Property Owners, Residents and Associates, lauded Clarkson for her efforts to rid the area of the newer, more commercial cans.
"We do feel they're not fitting within the historic ambiance of our city's most historic district," he said. "I just think the French Quarter is our showcase for the world, and it cheapens our image. Advertising on trash cans is not the symbol of the city that we ought to be putting out there."
CORRECTION:
Licensing contract awarded: An article in Tuesday's editions about a contract for downtown trash cans that display advertising erred in saying that the city of New Orleans had not picked a contractor to develop a separate sponsoring and licensing program for products and events bearing the city's imprimatur. In fact, the city last year awarded such a contract to a joint venture comprised of three firms: DD Marketing Inc. of Pueblo, Colo.; Trumpet LLC, a New Orleans advertising agency; and Rehage Entertainment Inc., a promotions company with offices in New Orleans and New York. (1/20/2005)
LOAD-DATE: March 12, 2005
Copyright 2004 The Times-Picayune Publishing Company
Times-Picayune (New Orleans)
Correction Appended
SECTION: NATIONAL; Pg. 1
LENGTH: 2204 words
HEADLINE: City's trash bin contract called wasteful;
Other firms say they can do more for less
BYLINE: By Gordon Russell, Staff writer
BODY:
As part of a no-bid deal with a local advertising company that enjoys close ties to the Nagin administration, the city of New Orleans paid $450,000 for garbage cans similar to those that competing businesses routinely provide for free.
Representatives of at least three companies that sell advertising on trash cans like those now dotting the streets of New Orleans say they would have been eager to provide the cans at no cost in exchange for the right to sell the ads that go in panels on the four-sided bins. To boot, two of the three said they also would have given the city a bigger piece of the ad revenue than the 15 percent the city is getting from the company that got the deal, Niche Marketing USA.
Nagin's chief administrative officer, Charles Rice, defended the city's decision to buy the cans, saying among other things that bidding would have been unfair to Niche, which he said submitted to the city the idea of advertising on cans.
But one of the three companies that said it would have provided the cans for free, Verres Media, submitted a proposal about two years ago that mentioned its ability to provide cans with advertising. At the time, however, the city was looking for a wide-ranging branding and marketing strategy, not trash cans, and the bid was overlooked.
Had the city gone out to bid on the trash cans, Verres officials said they would have resubmitted their previous offer, which would have saved the city $450,000 up front, and likely generated more money down the road.
And had the city entertained bids other than the one from Niche Marketing, it also would have heard from Eyeball Media, based in Atlanta, according to that firm's president, Richard Mashburn, who called Niche's contract "a sweetheart deal."
Eyeball provides similar cans with advertising to the city of Atlanta as well as private businesses. The company pays for the cans, maintains them and shares anywhere from 15 percent to 25 percent of the ad revenue with the client. Typically, cities get 25 percent, Mashburn said.
Mashburn, who checked out Niche's cans on a recent trip to New Orleans, said he intends to send a letter to city officials offering to help sell ads and giving the city a 25 percent cut.
"The way I look at it, the more the merrier," Mashburn said. "We would love the opportunity to come down there and sell."
City Media Concepts, a firm based in New York City that makes advertising cans similar to those the city bought from Niche, also provides and maintains similar receptacles at no cost. The firm typically shares 10 percent of its revenue.
Better terms from other vendors isn't the only problem rivals are finding with the Niche deal. City Media filed a federal lawsuit against Niche in October alleging that Niche's cans parroted City Media's design and concept. The suit says City Media's "trade dress" and trademark have been violated -- in essence, that Niche appropriated a trash can with a certain look and features that were pioneered by City Media.
The suit asks the court to seize all litter cans provided by Niche and to order the company to change its design.
City Media officials have said they would allow Niche to keep its cans on the street if the company paid an unspecified licensing fee. Niche officials have countered that the case has no merit. No trial date has been set.
Instead of conducting a bid process, the city opted to deal exclusively with Niche, which has ties to the brother of Chief Administrative Officer Charles Rice as well as to a lawyer who worked for Rice when he was city attorney.
Not only has the city paid for the cans -- which, at $750 a pop, have cost a total of $450,000 -- but Niche is forking over only 15 percent of the revenue from its sales, which so far have been less than brisk.
The city recently received the first of the royalty checks that are supposed to arrive twice a year. The total: $5,969. At the current pace, it will take the city 38 years to recoup its investment.
It is unknown how many ads the company sold to make that figure. Niche Chief Executive Officer Rodney Whitney refused to answer questions, but sales appear very slow: It is difficult to find any ads that are not "house ads": those that promote cleanliness, a donor to the "Imagine It Clean" campaign or Niche itself.
In Atlanta, Mashburn said he has been able to fill 63 percent of his ad space in nine months. If his company had access to the 600 cans in New Orleans and was able to sell ads at similar rates and at a similar pace, New Orleans would receive a check totaling almost $100,000 every six months.
Mashburn also noted that the city's decision to finance the purchase of the cans may have contributed to the slow pace of sales because Niche isn't on the hook for any real costs.
"If everything's coming out of your own pocket, you've got a real incentive to sell," Mashburn said. "Otherwise, you die."
When Christian Nardi of Verres Media saw the new trash cans popping up all over downtown New Orleans, he got a queasy feeling. That was my idea, he thought. When he learned about the terms the city had settled on, the queasiness turned to anger.
"I thought I got the shaft," Nardi said. "I felt like all the work I did on the proposal was for the city to take my idea and give it to someone else."
Verres' proposal, presented in early 2003 in response to a call by the Nagin administration for marketing ideas, centered on "traffic channelers," barricades with advertising used in airports and on outdoor walkways to steer pedestrians.
The process drew five responses, none of which the city pursued.
Verres' proposal also featured a picture of a trash can with four ad panels similar to those the city began buying from Niche last summer, and noted that the company could provide them as well.
Nardi said he made clear to city officials that the cans would be made available to the city under the same terms he offered for the traffic channelers. His terms: Give the cans to the city for free, maintain them and give the city 40 percent of the revenue from ad sales.
Nardi said he and an uncle who is his business partner "were both in awe of the idea that teachers are buying their own paper and books for students, and meanwhile the city is spending $750 apiece on trash cans that we offered the city for free."
But officials in the Nagin administration vigorously dispute elements of Nardi's account. In particular, they say, Nardi emphasized channelers, not trash cans, and that he never explained in writing the terms under which he could provide the cans.
"I read through every one of those proposals in exhaustive detail, and I would never remember he presented trash cans," said marketing director Matt Konigsmark, who coordinated the request for proposals for branding ideas. Konigsmark was not involved in last year's procurement of the trash cans.
"It is clearly an afterthought," Konigsmark added. "This whole proposal is focused on channelers, and then there's one page that said, 'Oh, by the way, we can do this.' There are 20 pages in the book, and 19 of them were on the channelers."
A review of the document shows that the garbage cans are indeed mentioned only in passing. The proposal also does not state that the financial terms would be the same as for the channelers.
But Nardi said he mentioned the garbage cans when he delivered the document to Konigsmark and made clear that the same terms would apply. Konigsmark said he does not recall such a conversation, and that even if it occurred, the members of the evaluation committee, which included Rice, would have relied on the written proposal to make its decisions.
"I certainly wasn't aware of the financial aspects of it," Konigsmark said. "He may have been willing to do it on those terms, but he didn't make that clear."
Konigsmark added that he read certain aspects of Nardi's proposal to mean that the city would have to help the company sell ads. "We're not really staffed to do that," he said.
Nardi said he was never expecting that kind of help. Rather, he wanted the city to assist in smaller ways, such as giving the company a letter it could use when soliciting potential customers.
"We wanted an endorsement," Nardi said. "We wanted their contacts, not for them to help us sell."
Rice has publicly defended the decision not to seek a better deal for the city through competitive bidding. After all, he said, the idea of trash cans with advertising on them occurred to him only because Niche representatives gave him and other city officials a demonstration of the cans, purported to be "bombproof."
In fact, that anti-terrorism feature makes the cans different from the cans that Niche's competitors offer for free, Rice said through a spokeswoman. But even if Niche's cans cost more than others, many of which claim only to be "bomb-
resistant," Niche's deal is unusual in that the company was not required to spend any money up front.
Rice said he was impressed with the cans and decided to have the city's trash collector, Waste Management, buy 600 of them, to be reimbursed by the city.
The pass-through arrangement freed Rice from having to follow public bid laws. Though he could have conducted one anyway, he said a bid process would have been unfair to Niche.
"Look at this realistically," Rice said in a November interview. "If you brought me an idea, would it be fair for me to steal it and profit from it? This was their idea."
Last week, Rice took a slightly different tack, saying his decision to deal with Niche -- which is owned by an African-American, Whitney -- stemmed from a desire to fulfill the mayor's goal of nurturing minority-owned businesses.
"The mayor stated he wanted to increase and build the African-American middle class and to increase African-American entrepreneurship," Rice said. "This was a young, energetic African-American company, and in keeping with the mayor's vision, we decided to work with them."
But though Rice said the city's dealings with Niche are purely about promoting black business development, there are close connections between Rice and people affiliated with the company.
Terrence Rice, Charles Rice's brother, was working for the firm when the deal was announced, the company president said at the time. The company's chief executive later denied that Terrence Rice had worked with Niche.
Terrence Rice has not responded to questions about his relationship with the company. Charles Rice, meanwhile, refused to take questions on the matter, referring them to his brother and company officials.
In addition, Bobby Smith, whom Charles Rice hired as an assistant city attorney shortly after his own installation as city attorney in 2002, left City Hall in March 2004 and now works for Niche Marketing.
Smith's departure from City Hall, where he was earning $61,000, came about three weeks after Niche Marketing was incorporated, according to state records.
Nagin spokeswoman Tami Frazier said Rice was unaware of Smith's relationship with Niche. She also noted that Rice was not city attorney at the time of Smith's departure and said Rice had not kept track of him.
Asked whether he thought the purchase was a good one, Nagin said: "When I reviewed this transaction many months ago it looked like a good deal to me. I also recall this program being funded by private dollars. I have no other comments since I have not looked into the specifics in quite some time."
In fact, half the money spent on the cans came directly from the city's coffers. The other half came from the "Imagine It Clean" fund, which received large contributions from city contractors Waste Management, Browning-Ferris Industries and Harrah's New Orleans. The money was spent at the city's discretion.
The controversy about the cans goes beyond whether the deal was a cozy one. Some New Orleanians also are offended by the cans themselves.
City Councilwoman Jacquelyn Brechtel Clarkson, who represents the French Quarter and is generally a staunch ally of Nagin, wrote Sanitation Director Veronica White a letter in November asking that the so-
called "Jazzy Cans" be removed from the Quarter. Clarkson said she had received several complaints about the commercial cans.
White responded that the cans "represent part of the Mayor's 'Imagine it Clean' campaign and as such it is not at my discretion to remove them without his authority." White said she would forward Clarkson's request to the mayor.
Clarkson said she had not heard back from the mayor and doesn't expect to. "He has more important things to do," she said.
Clarkson's efforts were cheered by some Quarter activists who said the cans are out of place, only more so since they are often placed near ad-free trash cans that were hailed at the time of their installation, just a few years ago, for being good-looking receptacles adorned only with a fleur-de-lis.
Nathan Chapman, president of the French Quarter neighborhood group Vieux Carre Property Owners, Residents and Associates, lauded Clarkson for her efforts to rid the area of the newer, more commercial cans.
"We do feel they're not fitting within the historic ambiance of our city's most historic district," he said. "I just think the French Quarter is our showcase for the world, and it cheapens our image. Advertising on trash cans is not the symbol of the city that we ought to be putting out there."
CORRECTION:
Licensing contract awarded: An article in Tuesday's editions about a contract for downtown trash cans that display advertising erred in saying that the city of New Orleans had not picked a contractor to develop a separate sponsoring and licensing program for products and events bearing the city's imprimatur. In fact, the city last year awarded such a contract to a joint venture comprised of three firms: DD Marketing Inc. of Pueblo, Colo.; Trumpet LLC, a New Orleans advertising agency; and Rehage Entertainment Inc., a promotions company with offices in New Orleans and New York. (1/20/2005)
LOAD-DATE: March 12, 2005
Copyright 2004 The Times-Picayune Publishing Company
Times-Picayune (New Orleans)
Garbage Cans, Rice -- Times Picayune May 2, 2005
Copyright 2005 The Times-Picayune Publishing Company
Times-Picayune (New Orleans)
May 2, 2005 Monday
SECTION: NATIONAL; Pg. 1
LENGTH: 761 words
HEADLINE: New bids planned for trash can ads;
N.O. is after bigger slice of revenue pie
BYLINE: By Gordon Russell, Staff writer
BODY:
Mayor Ray Nagin's administration plans to seek new bids in June for a controversial contract to sell advertising on hundreds of trash cans the city placed around town last year.
The no-bid contract now in place is held by Niche Marketing USA. Niche touted the cans as "bombproof" in convincing the mayor's "Imagine It Clean" campaign to mix city money and private donations and spend $450,000 on them. Niche also committed to sell ads on the sides of the cans and give City Hall a 15 percent cut of the revenue.
The controversy over the contract partly stemmed from ties between Niche and Charles Rice, Nagin's chief administrative officer, who recently issued a letter announcing the city's intention to seek new bids. When the deal was announced last summer, a Niche official said Rice's brother, Terrence Rice, worked there. Subsequently, the company's chief executive, Rodney Whitney Jr., denied that Terrence Rice was an employee.
Also, Niche employee Bobby Smith once worked for Charles Rice at the city attorney's office.
And the questions didn't end there.
While the city was buying 600 "Jazzy Cans" at $750 a pop, at least three competing businesses told The Times-Picayune that they routinely provide similar cans to cities for free in exchange for the right to sell ads on them. And two of the three said other client cities usually collect more of the proceeds than the 15 percent cut New Orleans settled for.
So far the city's return on its $450,000 investment has been paltry. The first of what are supposed to be biannual checks from Niche arrived in January. The total: $5,969. More than three months later, sales still appear to be sluggish.
Rice's letter said the city plans to issue a request for proposals for advertising sales by June 3, a few weeks before Niche's second royalty check is due. Beginning that same date, Niche "will no longer be authorized to sell advertising on the Jazzy Cans," the letter says.
However, the company isn't being fired outright. In a letter to Whitney, the ad firm's CEO, Rice encouraged Niche to submit a proposal.
In a written statement, Rice said he decided to seek bids "in an effort to be cost-efficient and provide better quality service to the citizens of New Orleans."
Rice also said the city has no plans at the moment to buy more cans "but will leave that open for the winning vendor to purchase cans if needed."
The decision to issue the request for bids comes two months after Richard Mashburn, president of Atlanta-based Eyeball Media, wrote to the city offering to sell ads on the trash cans. Mashburn, who has trash can advertising contracts in Atlanta, Memphis, Tenn., and other places, offered to sell the ads in New Orleans on a nonexclusive basis, meaning Niche could continue its own sales effort.
In the letter, Mashburn offered to give the city 25 percent of the money from the ads he sold, a sharp improvement on the 15 percent paid by Niche.
Mashburn has yet to receive a response to his letter. But he said he was encouraged by the city's willingness to seek fresh proposals and said he plans to bid.
"We're going to send a certified letter to Mr. Rice requesting that we be on the request for proposals list," he said. "We'll make a nice offer, one that's going to be hard to turn down."
Two other vendors in the trash can advertising business also said they're likely to enter bids.
Christian Nardi of Verres Media, who pitched the idea of selling ads on pedestrian "traffic channelers" or garbage cans in a 2003 proposal to the Nagin administration, said he'll probably bid.
Nardi's earlier proposal was in response to a request from the city for ways to make money through "branding" the city. Though that proposal focused on traffic channelers, it also made clear that his company could provide trash cans. The company was offering the city 40 percent of the revenue.
Meanwhile, City Media Concepts, which sells advertising on trash cans in New York's Times Square and elsewhere, will also likely bid on the New Orleans business, according to Vice President Peter Arbor.
When City Media became aware of Niche's New Orleans contract last year, it filed a "trade dress" suit against the local firm.
Essentially, the suit claimed that City Media pioneered a trash can with a certain look and features and that Niche had parroted it.
The suit has since been settled, said City Media's attorney, Andy Langsam, adding that the terms of the settlement are confidential.
Kerry Brown, Niche's attorney, did not return phone calls seeking comment.
. . . . . . .
Times-Picayune (New Orleans)
May 2, 2005 Monday
SECTION: NATIONAL; Pg. 1
LENGTH: 761 words
HEADLINE: New bids planned for trash can ads;
N.O. is after bigger slice of revenue pie
BYLINE: By Gordon Russell, Staff writer
BODY:
Mayor Ray Nagin's administration plans to seek new bids in June for a controversial contract to sell advertising on hundreds of trash cans the city placed around town last year.
The no-bid contract now in place is held by Niche Marketing USA. Niche touted the cans as "bombproof" in convincing the mayor's "Imagine It Clean" campaign to mix city money and private donations and spend $450,000 on them. Niche also committed to sell ads on the sides of the cans and give City Hall a 15 percent cut of the revenue.
The controversy over the contract partly stemmed from ties between Niche and Charles Rice, Nagin's chief administrative officer, who recently issued a letter announcing the city's intention to seek new bids. When the deal was announced last summer, a Niche official said Rice's brother, Terrence Rice, worked there. Subsequently, the company's chief executive, Rodney Whitney Jr., denied that Terrence Rice was an employee.
Also, Niche employee Bobby Smith once worked for Charles Rice at the city attorney's office.
And the questions didn't end there.
While the city was buying 600 "Jazzy Cans" at $750 a pop, at least three competing businesses told The Times-Picayune that they routinely provide similar cans to cities for free in exchange for the right to sell ads on them. And two of the three said other client cities usually collect more of the proceeds than the 15 percent cut New Orleans settled for.
So far the city's return on its $450,000 investment has been paltry. The first of what are supposed to be biannual checks from Niche arrived in January. The total: $5,969. More than three months later, sales still appear to be sluggish.
Rice's letter said the city plans to issue a request for proposals for advertising sales by June 3, a few weeks before Niche's second royalty check is due. Beginning that same date, Niche "will no longer be authorized to sell advertising on the Jazzy Cans," the letter says.
However, the company isn't being fired outright. In a letter to Whitney, the ad firm's CEO, Rice encouraged Niche to submit a proposal.
In a written statement, Rice said he decided to seek bids "in an effort to be cost-efficient and provide better quality service to the citizens of New Orleans."
Rice also said the city has no plans at the moment to buy more cans "but will leave that open for the winning vendor to purchase cans if needed."
The decision to issue the request for bids comes two months after Richard Mashburn, president of Atlanta-based Eyeball Media, wrote to the city offering to sell ads on the trash cans. Mashburn, who has trash can advertising contracts in Atlanta, Memphis, Tenn., and other places, offered to sell the ads in New Orleans on a nonexclusive basis, meaning Niche could continue its own sales effort.
In the letter, Mashburn offered to give the city 25 percent of the money from the ads he sold, a sharp improvement on the 15 percent paid by Niche.
Mashburn has yet to receive a response to his letter. But he said he was encouraged by the city's willingness to seek fresh proposals and said he plans to bid.
"We're going to send a certified letter to Mr. Rice requesting that we be on the request for proposals list," he said. "We'll make a nice offer, one that's going to be hard to turn down."
Two other vendors in the trash can advertising business also said they're likely to enter bids.
Christian Nardi of Verres Media, who pitched the idea of selling ads on pedestrian "traffic channelers" or garbage cans in a 2003 proposal to the Nagin administration, said he'll probably bid.
Nardi's earlier proposal was in response to a request from the city for ways to make money through "branding" the city. Though that proposal focused on traffic channelers, it also made clear that his company could provide trash cans. The company was offering the city 40 percent of the revenue.
Meanwhile, City Media Concepts, which sells advertising on trash cans in New York's Times Square and elsewhere, will also likely bid on the New Orleans business, according to Vice President Peter Arbor.
When City Media became aware of Niche's New Orleans contract last year, it filed a "trade dress" suit against the local firm.
Essentially, the suit claimed that City Media pioneered a trash can with a certain look and features and that Niche had parroted it.
The suit has since been settled, said City Media's attorney, Andy Langsam, adding that the terms of the settlement are confidential.
Kerry Brown, Niche's attorney, did not return phone calls seeking comment.
. . . . . . .
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