To meet New Orleans’ unfavorable business contract goals, Sidney Torres to hire his mom | Business News

Waste-hauling giant as he bids for one of two open sanitation contracts in New Orleans Sidney Torres IV He proposed handing some of the work for vulnerable businesses to his mother’s company, which had relied on Torres’ trash businesses for years to run, city records show.

Torres said the company Alma Torres runs is qualified for the job and that he plays “exactly by the rules.” But two council members and a government contracts expert said he was sidestepping local demands for vulnerable subcontractors to remain independent of the companies that employ them.

Contractors in New Orleans have flouted those rules before, leading to a series of controversies and more than one attempt to reform the system. Even with these reforms, loopholes remain — there is currently no ban on hiring relatives to meet the city’s diversity goals.

Still, of the five companies vying for the opportunity to ship trash and recyclables across large swaths of New Orleans, Torres appears to be the only bidder to do so. A city selection panel plans to review bids, including those from Torres’s IV Waste, on Tuesday and Thursday.

Torres, who answered reporters’ questions for his mother, has a history of working with her company, ART Cleaning Services: In 2008, he agreed to support his mother, a former event planner, and the company she set up for months by sharing warehouses, trucks, fuel and staff, according to a lease agreement obtained by The Times. New Orleans Advocate.

He also replaced a disadvantaged business partner with Alma Torres’ company the year after he won the contract to clean up the French Quarter.

Sidney Torres said his mother deserved the job she got, noting several other contracts she won that Torres was not involved in. He emphasized that ART has received DBE recertification approval from the city every two years since its inception.

“Every business, including DBEs, needs to be able to perform, and ART is no exception,” Sidney Torres said in an emailed statement. Alma Torres said her attorney recently died in the family and declined to comment without legal counsel.

Sidney Torres declined to say whether ART continues to rent properties or staff from him.

But observers say the arrangement does not appear to be in line with the intent of the plan to help disadvantaged small businesses. Alma Torres’ political spending — more than $320,000 since 2019 — suggests she is far wealthier than some of her DBE peers, they said.

“On the face of it, what you’re proposing to me is not in the spirit of what we want the program to be,” said Eugene Green, a member of the council’s health committee.

DBE procedures are often exploited

The contract Torres is seeking would reform garbage collection in the city, which has long been managed by two black-owned haulers, Metro Services Group and Richard’s Disposal. A patchwork of pieces collected from Metro over several monthscity officials divided their work into two parts and put the two jobs up for bid.

The company Torres wanted to work under the first contract would deliver trash in Lakeview, Gentilly, Marigny, Bywater and 7th Ward. Those working under the second will cover East New Orleans and the Lower 9th.

In his bid, Torres also proposed MDL Enterprise, a Marrero-based black-owned debris removal company. He would give 8% of his contract work to MDL and the other 30% to his mother’s company.

These partnerships aim to achieve a city goal of 35 percent of public contracts going to companies owned by economically or socially disadvantaged groups. A seven-person team from the city’s Office of Supplier Diversity is charged with implementing the goal.

The office was established under the leadership of Mayor Mitch Landrieu and recently tightened the rules in 2015, after finding a prime contractor Is shifting revenue through a disadvantaged company and recovering some of the funds on its own.

The earlier controversy was sparked by a Times-Picayune investigation that examined weak business projects at seven local government agencies. The report revealed how some of the program’s biggest winners were perceived as disadvantaged companies — Even if they are owned by millionaires.

Charles Tiever, a professor of government contracts at the University of Baltimore Law School, is not surprised. Many cities are taking advantage of minority contracting projects, he said.

“Over the past 10 or 15 years, the government hasn’t regulated DBE as much as they should,” Tiefer said. “As a result, it is very easy for large, high-quality businesses to exploit inappropriate vulnerabilities.”

Unlike the federal program, New Orleans’ DBE program doesn’t assume any group is disadvantaged: White men can apply, and dozens are certified, according to a 2018 report commissioned by the city. The same may be true of minorities and women.

In 2010, when Alma Torres’ weak position was revoked, her company’s independence was indeed called into question. A month later, a city oversight panel reinstated her after an appeal.

Since then, ART has been selected as a vulnerable subcontractor on three other city contracts that did not involve her son’s company, records show.

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Since 2015, ART has also handled sanitation for the French Market Company, which oversees flea and farmers markets, with a 12-member board appointed by the mayor. The contract brought her company at least $3.7 million in revenue, records show.

Vulnerable Donors

2018 Consultant Report It is recommended that city halls comply with a federal plan to limit the personal net worth of vulnerable homeowners to $1.32 million.

Instead, officials opted to cap the three-year average annual gross revenue of disadvantaged companies to just under $24 million, following the federal program’s guidelines for implementing beyond the net worth cap.

According to the latest available records, Alma Torres reported an average annual gross income of just under $673,000 for 2018-20.

She is also a political donor. In October, ART to Sidney Torres’ Voice of the People’s Action Committee. Since 2019, Alma Torres has made an additional $220,000 in federal donations, including $105,000 to Trump’s Victory Committee, which was Donald Trump’s unsuccessful bid for a second presidential term, records show Fundraising department.

The spending involved City Council member Oliver Thomas, who said the city’s weak business plan was not designed to help companies with such funds.

“I don’t know how many DBE companies have the means to donate hundreds of thousands of dollars,” said Thomas, chair of the committee’s health committee.

Sidney Torres said his mother “had access to more money than she could earn in ART,” though he didn’t elaborate.

When asked if his mother should qualify as economically disadvantaged, Sidney Torres said the law determines who and which businesses qualify for the DBE scheme. “I have no role in it,” he said.

enter the market

Sidney Torres, the son of a powerful Chalmette lawyer and the grandson of a longtime court clerk in the Parish of St. Bernard, is well known in politics. He is also known for his $250 million real estate portfolio, reality show.

He also received a wave of publicity in the years following Hurricane Katrina, when his first waste business, SDT Waste & Debris Services, won the contract Clean up the French Quarter. At the time, he hired Nolmar/Empire Services, a New Orleans firm, as his DBE partner.

Lesser known is that Torres replaced Nolmar/Empire with ART in February 2008 — four months after Alma Torres founded the company. Records show that in addition to regular payments from the city, he brought back to SDT no less than $25,300 a month in rent for the property and employees he rented from ART.

Torres said he cut ties with Norma/Empire due to performance issues. The company’s head, Charlie Lusko, did not respond to a message seeking comment.

Torres also said he was charging ART a reasonable rent and that he was trying to help a disadvantaged business get off the ground.

“Equipment leasing enables this DBE to enter the market and be as successful as any DBE,” Torres said.

Contracting professor Tiffer said while the arrangement was not illegal, it raised questions about how much control Alma Torres had over her company when she was originally hired by her son.

Under DBE rules, “before he seeks a government contract, it must be owned and controlled by her, not him,” Tiffer said.

The city cited an unspecified “control issue” when it revoked ART’s vulnerable certification in 2010, then reinstated it on appeal. City officials said records of the dispute were not available.

Torres said the city was well aware of his arrangements with ART, and city officials praised his mother’s work.

“Alma Torres has the intelligence, hard work and business skills to run her own business, and has done so and will continue to do so,” he said.

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