Reclaiming Recovery: Ensuring the New New Orleans Benefits All Residents through Equitable Growth

28 Aug 2015 | Kalima Rose
Reclaiming Recovery: Ensuring the New New Orleans Benefits All Residents through Equitable Growth

Hurricane Katrina and its aftermath made it impossible for the world to ignore the entrenched racial disparities within New Orleans. Now 10 years and $71 billion in federal recovery resources later, it is incumbent on us to ask: have the recovery efforts made New Orleans a more equitable city?

Unfortunately, the answer is: not enough. New Orleans and the nation missed a vital opportunity to use the influx of federal investments post-Katrina to address the city’s long-standing racial inequities, resulting in an uneven recovery that has disproportionately left Black residents across the income spectrum behind. In a recent survey, 78 percent of White residents say that New Orleans has mostly recovered, but almost 60 percent of Black residents feel the opposite. Similarly, 61 percent of Whites feel that the local economy is better now than before Katrina, but only 10 percent of Blacks do. This is not surprising when you consider that 52 percent of working-age Black men are jobless, 51 percent of Black children are living in poverty, and the gap between the median income of Black and White residents has grown by 18 percent since the storm, according to recent data from the National Urban League. About 100,000 fewer African Americans are now living in the city.

Why did recovery investments help some residents and not others? While there were concerted efforts from philanthropy, public sector leadership, Black communities, and equity advocates to ensure that Black residents could recover, contracting practices determining how the majority of federal recovery dollars were spent colluded against this. The majority of recovery dollars went to large-scale, out-of-state contractors, not to local contractors who would have spurred job growth and provided recovery-related career paths for local residents. In the year following the storm, even fewer public contracts went to businesses owned by women and people of color than usual, in part due to a decision by the Department of Labor to suspend federal affirmative action regulations. The result was that only 1.5 percent of the major federal contracts in that first year went to such firms, instead of the 5 percent customary in previous years. Overall that year, small businesses received just 13 percent of contract dollars granted by FEMA, with local businesses (those headquartered in the three states worst-hit by Katrina) only received 16.6 percent of FEMA dollars, while 30 percent went to businesses in Virginia.

By 2010, New Orleans’s leaders started to push back against these practices, implementing city-level efforts to connect local firms to recovery project investments, and finally turning attention to businesses owned by people of color. Where these commitments to equitable contracting were made, the results have been transformative. For example, the Board of Commissioners of the Regional Transit Authority (RTA) of New Orleans opened their books in 2010 to an evaluation of their contracting practices in hopes of installing more equitable policies. As a result of this evaluation, RTA nearly tripled the percentage of their contracts that went to businesses owned by women and people of color — an influential move at a time when the city was working to rebuild streetcar lines and reestablish transit service throughout the city. Next, the RTA focused on ensuring that the transit needs of low- to moderate-income workers in the city were addressed. They found that the bus routes failed to provide adequate service for shift workers in two of the largest sectors — health care and hospitality — prompting an investment of $5.9 million in additional bus services, allocated this year, to fill the gaps in service. Other equity-based efforts by RTA have included workforce development programs for unemployed and underemployed youth and a Riders Advisory Committee that gives transit-dependent residents a voice in transportation decisions.

In addition to RTA’s work, the city — under the guidance of Mayor Mitchell Landrieu — launched an effort to increase the number of Disadvantaged Business Enterprises (DBEs), a demarcation that includes businesses owned by women and people of color, that could compete for and win public contracts. From 2010 through 2014, DBE firms were awarded more than $400 million in business opportunities with the City of New Orleans, New Orleans Aviation Board, Sewerage and Water Board, and the Regional Transit Authority. The number of certified DBEs doubled from about 300 to more than 600 local businesses, and participation by DBEs in public contracts rose from 16 percent to 34 percent by 2014. These changes are part of larger efforts to embed equity into economic development within the city through the Mayor’s ProsperityNOLA five-year development plan.

City-led efforts such as these are a critical step in the right direction, but come too late for delivering the kind of impact that was possible had all of the federal recovery dollars been targeted to support equitable growth from Day One. It is essential that other cities heed the lessons learned from New Orleans’s first 10 years of recovery. If efforts to rebuild are not initiated, targeted, and implemented with the intention of equitable development, “recovery” may only deepen existing inequities. With inclusive growth, however, cities can chart a course toward more resilient local economies that not only weather the trials of recessions and disasters, but provide the scaffolding around which strong, healthy, thriving communities can grow. May New Orleans see more of this kind of development in its second decade of recovery, and may the African American community be its first architects and beneficiaries.

Kalima Rose is the Senior Director of the PolicyLink Center for Infrastructure Equity. From 2005 until 2010, Kalima led the organization’s Gulf Coast recovery work to shape a more equitable post-Katrina rebuilding of New Orleans and Louisiana.

Read the rest of the August 28, 2015 America’s Tomorrow: Equity is the Superior Growth Model issue.