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After a year-long saga regarding the future of New Orleans waste collection, Mayor LaToya Cantrell’s administration has reached a tentative deal with trash hauler Metro Service Group.
If a settlement is approved, The Times-Picayune reports the city will pay millions of dollars to the contractor to repay its creditors, effectively terminating the company’s sanitation contract.
Troubles for the city’s waste collections first started in the aftermath of Hurricane Ida, when the city claimed Metro failed to provide services to one-third of service areas in its contract. As reported by WDSU, city leaders also said Metro is only capable of providing once-a-week pickup and has not provided recycling since before Ida.
After months of delays, Metro ultimately filed for bankruptcy in October as new contracts were set to take effect, creating a new hurdle for city administrators.
While the deal must still get approval from a federal judge, as Metro remains under Chapter 11 bankruptcy protection, City Attorney Donesia Turner tells The Times-Picayune that she “fully expects that the settlement will be approved” given that all parties were at the table for a mediation session Dec. 5.
Under the terms of the agreement, the city is expected to pay $3.9 million to Metro, according to a city news release. Turner says that all of the city’s contribution is to be redirected toward Metro’s creditors, with none going to the company or its leaders. Maryland-based financial group McCormick 101, a large Metro creditor, will receive $5.8 million and unsecured creditors will receive $350,000.
The global settlement also calls for Metro to sell off $2.2 million of its assets to continue toward its debts.
Two new haulers, New Orleans-based IV Waste and Longwood, Florida-based Waste Pro, have won contracts to take over Metro’s service area, which covers Lakeview, Gentilly and New Orleans East. The companies began making collections on Metro’s previous routes Nov. 7. Metro’s last day making collections was Dec. 6.