"Has attempted"

Is that what they've been doing?

This year, Louisiana state legislators could consider bills that could bring tighter regulation and enforcement to the state’s short-term rental industry.

New Orleans housing advocates say the proposed bills are a step in the right direction in controlling an industry they claim negatively impacts housing stock and affordability for residents by taking homes and apartments off the long-term market and renting them to tourists.

For nearly a decade, the city of New Orleans has attempted to regulate the short-term rental industry through a myriad of local ordinances. The regulations, which have largely focused on short-term rentals in residential neighborhoods, apply to properties that are listed on platforms like Airbnb and VRBO. Airbnb and short-term rental operators have struck back, repeatedly challenging the city’s permitting rules in court, and New Orleans City Council President JP Morrell has subsequently threatened to ban short-term rentals altogether.

As someone who has watched closely each of these "attempts," I guess it's marginally fair to call them attempts "to regulate." But that's not the same as saying they have been in any way good faith attempts at limiting or even mitigating the harm STR rent seeking has done to life in the city. Rather, the city has simply continued to tweak at Mitch Landrieu's original framework for legitimizing (and drawing revenue from) the practice of converting houses to hotels that has gutted New Orleans's most culturally significant neighborhoods during the period of hyper-exploitation some have cynically termed a "recovery" from Hurricane Katrina. 

 

Predictably, this strategy tended to leave people unsatisfied. So much so that, occasionally, City Council has been moved to take on the appearance of trying to do something about it. They never get it right, though. Now state lawmakers are trying their hand at it.  The above article references bills by Barbara Carpenter, Royce Duplessis and Stephanie Hilferty. Carpenter's bill is intended to grant municipalities clearer authority to impose regulations. Royce's bill would allow neighbors to sue operators of unlicensed STRs in their area. Hilferty's bill raises the maximum tax rate that the city can collect.

 

Royce's is the most aggressive here. According to this article, there are as many as 3100 unlicensed STRs currently operating in New Orleans. But JP Morrell keeps promising city council will affect an outright ban on STRs in Orleans Parish someday.  Should we hold our breath? Or do we have bigger worries on the horizon?  According to that same article, for example. 

At the same time, there are signs that demand for rooms — whether in short term rentals or traditional hotels — has been softening. As of last week, there had been about 13.6% fewer short term rental bookings during Jazz Fest than there were by the same time last year, according to AirDNA. 

Tourism groups are expecting a drop-off in hotel stays as well. New Orleans and Co. is expecting hotel occupancy to be between 72% and 89% each night during Jazz Fest this year, based on a survey of hotels that collectively have about 26,000 rooms in and around downtown and the French Quarter. Last year, the occupancy rates were between about 84% and 95%. Hotel bookings were up during Mardi Gras, when occupancy reached 95%. But at the same time, short term rental units were booked for about 8.5% fewer nights, according to AirDNA.

Usually when we talk about Airbnb, the immediate problem is nobody actually lives here anymore.  Now, come to find out, nobody actually tourisms here anymore either. 

Getting flushed but remaining flush

A Knights of Chaos float from this year's Carnival depicts Sewerage and Water Board Director Ghassan Korban (along with his salary)

One of several interesting things McBride pointed out today while watching the Sewerage and Water Board meeting was this apparent move to help Ghassan Korban cash out if the state really does manage to take over the utility. 

The Sewerage & Water Board Thursday approved a three percent raise to Executive Director Ghassan Korban’s more than $300,000 salary, even as the Gov. Jeff Landry’s hand-picked task force released a plan to strip much of the local control of the city’s sewer, flooding and water treatment utility.

S&WB watchdog Matthew McBride, who first reported the pay raise vote, noted that “according to the salary published in the 2022 audit, this will increase his salary from $338,365 to $348,515.” According to the U.S. Census Bureau, as of 2022 the average median household income in New Orleans was $51,116.

They also doubled his available leave time which further indicates a sizeable buyout could be coming soon. The board members are also quoted here making annoying comments in praise of Korban that place him among "the employees of the sewerage and water board" they claim to be very proud of.  But that is a complete distortion. Korban isn't a rank and file employee. He's a highly compensated administrator who, even if he does get canned by Jeff Landry, won't have to worry about where his next meal is coming from for a very long time afterward.  Korban is pretty close to retirement anyway. I'm sure the salary boost will help maximize his pension as well.  

We can't say the same for most of the actual employees of Sewerage and Water Board. Their future is very much up in the air. Stephanie Hilferty has a bill pending that could transfer them all from the city to the state civil service system.  I wonder what that does for their benefits, leave, and retirement plans.  I'm guessing its not the same sort of jackpot their boss just got.

And a plague descends upon Louisiana

No no, as of this morning, there are no reports of coronovirus cases in the state yet. This means we still don't have to cancel Jazzfest which may or may not be good news depending on how many Airbnbs you own. [UPDATE: Well halfway through typing this up I see that we have one now so ignore this joke]  Instead, today's top reason for existential dread is occasioned by the convening of the 2020 Louisiana Legislative Regular Session. May God have mercy on our souls.

BATON ROUGE, La. (AP) — A Louisiana Legislature packed with dozens of new members starts its first lawmaking session of the term Monday, with a grab bag of topics for debate and none of the budget woes that preoccupied the last term.

Lawmakers will consider whether to legalize sports betting and recreational marijuana, whether to do away with Louisiana’s use of the death penalty or change the means of execution, how to spend a multimillion-dollar surplus and what approach they’ll try to combat high car insurance rates.

And they’ll do it without the financial gaps that became the primary focus of lawmakers and governors for a decade, after a tax deal brokered by Democratic Gov. John Bel Edwards and the majority-Republican Legislature last term stabilized the budget picture.

*Record scratch*

Whoa hold up a sec there with all that surplus talk.  Have you seen the oil prices, lately? This isn't supposed to be a fiscal year but we could be digging deep into the budget anyway depending on how bad the panic gets. What to do, what to do?  Would you guess, make sure we hand out bigger corporate tax breaks with less local oversight?  If so then you do know this legislature pretty well already.

The preliminary media analysis of this session talk a lot about a new spirit of "cooperation."  The Governor has been reelected so Republicans won't be trying to undermine his agenda just for the sake of it.  The presumably more "moderate" candidate was elected Speaker. And, prior to the virus induced economic panic, the budget fight wasn't expected to be quite so intense.  But this is still the most right wing legislature elected in decades. And the Senate, which had been a moderating force in recent years, is now more firmly in Republican hands. So expect plenty of bad things on the agenda even if the struggle over each item is less dramatic.

The Governor seems resigned to this, in fact, surrendering on a few potential flash points in advance.  He's already reversed his own policy with regard to the industrial tax exemption. And had declined to seek a teacher pay raise before being goaded back into it by what was thought to be one of his most valued constituencies. He's more likely to dig in a little bit in the coming fight over "tort reform" which is likely to be the toughest fight of the session.  See this latest article in an ongoing Bayou Brief series for a preview of that.

Again, it's an extremely conservative legislature so be on the lookout for nuttiness. There's a bill in there to ban transgender high school students from sports teams, for example.  With the virus on everyone's minds, you would think this bill by Mandie Landry to help people vote by mail would be a good idea this year, but something tells me that's going to hit a wall in this House.

Meanwhile, Stephanie Hilferty wants to impose mandatory minimum jail sentences for car burglaries. We would have thought that retrograde approach to criminal justice was long since discredited. But, since the guy who wrote the 1994 mass incarceration bill is now the presumptive Democratic nominee for President, all that stuff is back in style.

Anyway, ready or not, the #LAlege is back.  Better make sure we've stocked enough disinfectant. They can be a nasty strain.

Are they going to try and privatize it?

Matt McBride has never been the most optimistic analyst. But, then, when it comes to flood water, a half full city is bad enough however you choose to look at it.  Anyway when you hire McBride to tell you how your system is doing, odds are he's going to say it's worse than you thought it was.

The Sewerage & Water Board's power system came "dangerously close to complete collapse" months before flooding last Aug. 5 revealed severe problems in the utility's power and drainage facilities, according to an engineer the city hired to assess those facilities. He also found water pressure dropped twice to "dangerously low levels ... without anyone noticing."

After reviewing activity logs from the Sewerage & Water Board's power station, engineer Matt McBride discovered all four of the utility's 25-cycle power turbines either failed or were already down during the five-day period last year from March 7-11. He emailed his assessment to a former top  city official on Sept. 29, 2017, amid emergency repair efforts by the utility to patch the aged power turbines.

McBride's findings, reported exclusively by NOLA.com | The Times-Picayune, offers startling new insight into the state of the Sewerage & Water Board's power generation system shortly before two summer deluges flooded the city in July and August.

"The events from March 7th forward are far worse than what has been publicly revealed," McBride emailed.

So that makes for fun reading on a Friday afternoon.  Toward the end there is a status report on the turbines. It says Number 1 is down currently and the long troubled Turbine Number 4 is being tested to see if it is suitable for "emergency use."  There are rumors that testing hasn't gone well but that isn't in the story so we'll wait to hear more.

Meanwhile, almost a full year after the bulk of its leadership was swept away in the wake of a flood, the Sewerage and Water Board has settled on a new director.

The board voted unanimously to hire Ghassan Korban over his fellow finalist, former New Orleans city attorney Avis Marie Russell, after an hour-long closed session.

Korban, 56, has been commissioner of the Milwaukee agency since 2011, a job that includes oversight of the Wisconsin city's water department. He has held various executive roles within that office over the past 31 years, a résumé that impressed city officials.

“What it boiled down to was the overall experience that Mr. Korban brings, but also, what our needs are right now in the city of New Orleans,” said Mayor LaToya Cantrell shortly after the board’s vote.

That's right. She said, "boiled down to."  It's fine. For a while the interim director was a guy named Rainwater.  We live in a very bad TV show. Everybody knows this.  Anyway, apparently, Korban is a people person.

Duplessis, the utility president pro-tempore, added that not only did Korban's experience in utility services set him apart, but he also scored high marks in the "people portion" of the selection committee's criteria.

"...He had a sincere dedication to connecting with the people," Duplessis said, "not only looking inward in terms of our organization, making sure that we do right by employees and put them first, but also being that public face and talking to our citizens and making them very much a part of the process."

It's important that the new S&WB "do right by employees" given that they seem to have so much difficulty retaining them.

Amid calls for more staff, utility officials have acknowledged hiring managers have been taxed with daily and emergency responsibilities on top of scheduling interviews with job candidates and recommending who to hire. The July 13 hiring day should help managers plug many vacancies at once.

"This agency's greatest asset is our team and in order to work at our full capacity we need hardworking individuals to answer the call to serve their city," Jade Brown-Russell, the utility's acting executive director, said in a statement.

As of May 31, the Sewerage & Water Board's human resources department reported the utility had 534 total vacancies. Much of the staffing shortfall is traced to 463 newly budgeted positions added over the past two years, as well as the retirements, resignations or terminations of 395 employees since June 2016, according to the utility's news release. In all, the utility says 574 new employees were hired between June 2016 and April 2018.

It might help if the leadership over there wasn't so quick to blame their "greatest asset" when things go wrong. But contempt for workers is such a long standing tradition in New Orleans, the reflex is almost involuntary. When a botched cutover to a new software system threw the entire city's water bills into chaos, S&WB accused employees of laziness and incompetence saying they "never took to" the new system.  Employees told the  Times-Picayune  that S&WB management regularly belittled and intimidated staff rather than listen to their concerns. 

Amid calls for more follow-up training, former and current utility officials have declared the system itself, provided by Canadian firm Cogsdale Corp., is not the problem. They argue the problem rather traces to under-supported, short-staffed meter readers and billing personnel, some of whom they claim stayed loyal to the old billing system.

But two Sewerage & Water Board employees with direct knowledge of the utility's billing department and new billing system insist the software still has technical problems, particularly in how it estimates monthly water bills.

These employees agree follow-up training has been sorely lacking, but also say the initial training did not match up with real-world scenarios once the system launched in late 2016.

"It makes us seem like we're illiterate and don't know anything," one employee said. "That's not the case."

The classism embedded in the work culture of New Orleans is born of a deep and abiding racism. Every tossed off comment about incompetence or laziness resonates with echoes of vestigial racial hierarchies.  On the first day of my first job out of college, one of the first things my boss said to me was, "The problem with New Orleans is people here don't want to work." This wasn't an accusation directed at me, exactly. It was meant as more of a just-between-us-white-guys helpful hint. "Those kinds of people" of which there are a lot in New Orleans, need to be kept in line.  It's the deep internalization of these social presumptions that have made New Orleans a company town through and through. Only the boss is assumed to have any rights. Everyone else is probably trying to get away with something.

Hostility and suspicion directed at workers permeates everything. We confront it even when may not recognize it for what it is. It manifested itself last year in the scorn Saints fans displayed for the players' anthem protests. It also drove the obscene displays of reverence for their boss that came pouring out from every corner of the political and media establishment during his funeral. It is why "tourism leaders" and university presidents sit on every local municipal board and make decisions affecting the use of millions of dollars in public funds with little or no input from the workers whose exploitation produces that wealth.

These attitudes also color our relationship with public services such as those provided by the Sewerage and Water Board.  Which is why a basic provision like clean water is only understood in terms of its effect on profits.  It's why we're able to be so cruel and dismissive as to shut off service to rate payers victimized by the billing SNAFU. It might even be why Gambit didn't bother to give us an option in this poll for "They should never do that."

How well does LaToya Cantrell understand any of this?  Not very.  Her remarks at recent job fair had her using S&WB employees as kind of a human shield against public criticism.

"No longer will we tolerate disrespect as it relates to the Sewerage & Water Board," Cantrell said. "And I don't care where it comes from, because you all deserve respect every step of the way, and you have a mayor and you have leadership in place within the Sewerage & Water Board, again, to ensure that you succeed."

Cantrell's remarks follow a letter she sent May 24 to New Orleans City Councilman Joe Giarrusso, in response to a letter he had penned that referenced the utility's "terrible customer service, lack of transparency and poor efforts to engage the public." Cantrell, in her letter, chided the "demands and perceived tone" of Giarrusso's letter, calling it discouraging to the utility's staff and leadership morale.

"As we hold them to high standards, we must remember that neither the board members nor the (Sewerage & Water Board) employees are our enemies," Cantrell wrote. "It is incumbent upon us to work with them to benefit the people of our city."

As we've tried to show above, though, the "disrespect as it relates to Sewerage and Water Board" is coming from inside the house. It's management who isn't respecting the rank and file employees. LaToya is flattening the difference between the board and the employees in order to mischaracterize justifiable public criticism of the way the agency is run as an attack on the people with the least power to do anything about that. Leadership can abuse its charges however it wants. But criticism of leadership from outside is not allowed.

This kind of deliberate class blindness is a staple of Cantrell's political style. As she herself put it in her primary night speech last year, "I'm not talking about taking from the rich and giving to the poor and all that kind of crap." Indeed it is often her purpose to protect the rich from the poor by denying the existence of a conflict between the two.  LaToya defines her approach to housing policy, currently our city's hottest flashpoint of wealth inequality, as a search for "balance."  Her land use decisions as a council person frequently favored spot zone requests for short term rentals as well as incorporating the best "incentives" for developers and what she referred to as "the landlord community."

Cantrell supports these class distortions using a rhetoric peppered with Orwellian slogans and soft bullying phrases calculated to elicit fear and conformity.  #CityOfYes is, of course, the most famous of these but there is more. She's not using "It's got to be we" so much anymore but the spirit of that is still alive in her take on S&WB criticism. It ran throughout a chilling letter she sent to city employees during her first week in office. In that letter LaToya asked the employees not to think of her as a boss but as the head of a family.

First and foremost, I want you to know that you matter to me. We public servants have to stick together, and I think of each and every one of you as my family, because I care about each of you individually and I want you to know that you are seen, you are important, and you are recognized for your work serving our city.

Claudius:

And we beseech you, bend you to remain
Here in the cheer and comfort of our eye,
Our chiefest courtier, cousin, and our son

Or even Mitch Landrieu's "One City One Voice" provides a more immediate comparison. Mitch was an egomaniacal bully too but it's LaToya's penchant for framing professional functions in terms of personal familial relationships that is most disturbing. It is an authoritarian tendency; less a genuine expression of affection than a demand for deference. 

And so the condescension drips from every pipe. Got a problem with your water bill?  Better watch your tone there, buddy.  Trying to figure out what's going on with all the road work? Here's a goddamn garden gnome to explain it to you like you are some kind of child. Which is why we're starting to get a little tired of asking questions at all. Like why is that just as the city has (finally) secured $2 billion from FEMA for infrastructure work that S&WB is "pressing pause" on a $114 million bond issue  that would get some of that work started? Maybe that's a stupid question. If it is, though, it would be nice to think we could get a straightforward answer instead of a huffy brush back or some sort of puppet show.

But, okay, at the risk of all of that, what do we suppose is going on here? 

The task force was created in a bill sponsored by Rep. Stephanie Hilferty, a Lakeview Republican. It will be comprised of eight people — a member of the New Orleans City Council, a representative of Mayor LaToya Cantrell, a representative of the Sewerage & Water Board, a representative of the Inspector General, plus engineering, business and tourism leaders — and is charged with examining whether the agency should continue to function.

“Over the last several years, many residents, business owners, and local officials have questioned whether the Sewerage and Water Board is the best entity to manage sewerage, water, and drainage facilities and services in the city of New Orleans,” Hilferty’s bill states. “Suggestions abound regarding the best management options for the city’s sewerage, water, and drainage facilities and services, including but not limited to public-private partnerships, granting control to the city, or allowing the Sewerage and Water Board to retain control.”

Maybe the gnome will weigh in later but this looks an awful lot like a first step toward privatization. If so, it's hardly a bolt from the blue. It's something that has been building for a while and, now, the pieces are in place at the city, state, and federal levels that could make it happen. Take a look at these parting comments from Mitch Landrieu  just before he left office.

While stopping short of endorsing specific plans, Landrieu suggested that the city's aging drainage system is too far gone for mere repairs. He also said incoming Mayor LaToya Cantrell, who takes office May 7, should put the effort at the top of her to-do list.

"This ought to take priority over every other thing we're doing in the city," Landrieu said.

Regardless of the exact form it takes, such an endeavor would be costly and difficult, and Landrieu warned that residents would likely have to foot the bill with little help from the state or federal government. But he cast the changes as essential to the city's survival and said that deciding on and funding such a plan should be of top concern.

Now that McBride's report is public we have a better understanding of what Mitch meant by "too far gone."  That "residents will have to foot the bill," is a little cryptic, though. Let's talk about that. Major infrastructure work, such as replacing an entire municipal drainage and water system, depends on federal support. This is true even when the federal government is in the hands of 19th Century robber barons as it is today.  When Mitch is saying residents will have to foot the bill this time, he means they will have to pay more of the bill than they previously would have been hit with.  He knows this because he's seen Trump's infrastructure plan.

The meagerness of the federal contribution — just $200 billion over ten years, or less than 0.1 percent of GDP over that period — was already clear from the State of the Union. Half of those funds are allocated to an Incentive Program intended to support surface transportation and airports, passenger rail, ports and waterways, flood control, water supply, hydropower, water resources, drinking water facilities, wastewater facilities, storm water facilities, and brownfield and Superfund sites. Just listing everything the President’s plan claims to address for a federal expenditure of just $100 billion makes the inadequacy of the plan obvious. But there’s more.

The Incentive Program requires states and localities to put up 80 percent of the cost of any project in order to get a federal match of 20 percent. This turns the traditional approach to infrastructure investment on its head. The federal government typically provides 80 percent of the funding for such projects. It is wishful thinking to imagine how cash-strapped states and cities — already on the hook for extensive local infrastructure spending — will be able to find new public sources of financing, especially now that the recent Republican-passed tax law has severely limited their ability to raise taxes to pay for such undertakings.

No, we won't be able to afford that on our own.  Which is where the essence of the Trump plan really comes into play. It's all about privatization.

Trump’s plan turns infrastructure investment on its head in another way as well. Traditionally, the selection of projects to be funded by the federal government emphasized benefits to the public. The administration’s plan weighs the ability to attract sources of funding outside the federal government at 70 percent when considering whether to support it; economic and social returns from the project count for just 5 percent. Federal funding will go to projects that are most attractive to private investors, rather than to those, like clean water, that meet the needs of communities.

Profitability of private investment is everything. The social benefit of building the infrastructure in the first place, counts for almost nothing. Public-private grifting is the order of the day. There isn't a lot the city can do about that. But we should at least demand that our elected leaders resist this piracy.  Unfortunately, given the way they talk about public-private partnerships, "balance" inducing tax incentives, and their flat-out dismissal of the role of class in politics, our elected leaders don't seem to be equipped to do that very well at the moment.

None of this is to say they're definitely going to privatize Sewerage and Water Board. The other finalist for Director was actually part of a group who tried that once and she didn't get the job. maybe that counts for something. Still it may take a fair amount of upticking in order to steer us away from this path we're on. Which is to say the "tone" may have to get worse before things get better.

Just give us our money

Score one for the #FixMyStreets trolls.

A state representative is proposing to redirect about $16 million a year in taxes from the Ernest N. Morial Convention Center to an independent board that would spend the money on fixing streets in New Orleans.

The proposal, by state Rep. Stephanie Hilferty, would take the revenue from two existing taxes away from the center. The taxes, a 1 percent tax on hotel rooms and a quarter-cent sales tax on food and drinks sold citywide, were put in place by the Legislature in 2002 to fund an expansion of the Convention Center that has not taken place.

“I understand that tourism is one of the backbones of our economy, but our city can’t crumble around our tourism district,” said Hilferty, a Republican whose district includes Lakeview and parts of Metairie.

Yeah get 'em! We've been clamoring about this for years. This is revenue raised off the backs of restaurant, hotel, and casino workers, musicians, cab divers, everyone who makes the "tourism economy" go. That includes pretty much all of us who make this place our home. Even if you aren't a celebrity chef or a busker with heart of gold or whatever, you probably take in your share of parades or Saints games or you know that one way to cook that one thing your grandma made.  It takes a whole city to "bear a culture." We're all New Orleans. Some people are in the business of selling a version of our life to tourists. We deserve to share in the benefits of that.  Some stupid board of political insiders shouldn't get to decide....  oh wait a minute... 

The money would be overseen by a nine-member board including representatives from each City Council district, to be be appointed by the state lawmakers from those districts, plus representatives of the city’s Department of Public Works, the Sewerage & Water Board, the Regional Planning Commission and Louisiana Associated General Contractors.

Oh dear... always a catch. Have to say, though, if we're choosing between rackets, this might be the slightly better one.