Katrina +5: Billions of Dollars Later, La. Has Made Strides

On August 29, 2005, the United States experienced the greatest natural disaster in the nation’s history when Hurricane Katrina bore down on the Gulf Coast. The damage caused by Katrina, compounded less than a month later by Hurricane Rita, resulted in the loss of 1,100 lives, 220,000 jobs, 215,000 homes, and 18,700 businesses, and displaced 785,000 residents. Overall, the financial impact on the entire Gulf Coast is estimated to be around $100 billion.

“Everyone was damaged; the storm didn’t discriminate between black and white,” said Xavier University President Norman Francis, who initially headed the Louisiana Recovery Authority established by then Gov. Kathleen Blanco in October 2005 to manage the state’s recovery and rebuilding efforts. “But if you had nothing before Katrina, you had even less after.”

The challenges associated with developing and deploying the recovery process were almost as overwhelming as the storms and came with a significant learning curve. First, because they were so catastrophic, there was no comparison and therefore no blueprint to help guide the process. Second, the $6.2 billion that Congress initially appropriated to the state in the form of community development block grant (CDBG) funding came with a lot of rules and regulations that were difficult to interpret, some of which hindered rather than helped the process. One example was a requirement of local matching funds in order to draw down on the federal funds for public assistance and infrastructure projects, which was eventually waived, but not before it slowed down the process.

“Some communities and the local tax base had been devastated by Katrina, so coming up with matching funds was a problem,” said Southern University political scientist Albert Samuels. The requirement, he said, made many parishes and smaller municipalities feel as if the monies didn’t even exist.

Capacity also proved to be an issue. “We didn’t have a lot of staff in place that could handle the scope and scale of the disaster, so we were really forced to bring on a lot of people at one time and make sure that we had the staff infrastructure in place to handle

such a large event,” explained LRA executive director Robin Keegan. The LRA; state, local and congressional lawmakers; and others spent a substantial time with Housing and Urban Development officials learning the nuances of federal regulation and how New York used its resources after the World Trade Center bombing.

But sometimes challenge brings opportunity, and despite the obstacles inherent in the recovery effort, officials and residents were able to seriously consider and decide what they wanted their parishes and communities to look like once reubuilt. Through a project titled Louisiana Speaks, each parish was able to design its own recovery planning process, which was used as the basis for developing some of the funding sources, particularly for infrastructure programs. According to Keegan, parishes received approximately $700 million to implement their plans.

The LRA’s fourth-quarter 2010 report shows that of $35.5 billion allocated to rebuilding, $17.4 has been spent; 13.6 billion has been allocated and spent on the National Flood Insurance Program; $14.8 billion of the $15.8 billion allocated to disaster relief has been spent; and $6.9 billion allocated for Small Business Administration loans has been spent.

The bulk of $13.4 billion in CBDG funding went to housing programs, specifically the Road Home Program, because that’s where there was the greatest damage and need. But according to Samuels, New Orleans in particular tells a tale of two cities. Much of the central business and tourism districts have been restored and are up and running, but there are still some neighborhoods where not a lot has changed and others that are in as bad a condition as they were immediately after the storm.

“Affordable housing is a major issue. A lot of the public housing was shut down and the logic for shutting it down defied reason,” said Samuels. “It almost seemed like they didn’t want people to come back because some of those facilities were structurally sound.” The city is suffering he said, from limited housing opportunities and the limited number of schools that have opened. “Rents have skyrocketed and some schools have waiting lists, which is keeping families away.”

Keegan

concedes that there are still unmet needs and the LRA is seeking ways to develop more nuanced neighborhoods that will include affordable housing and commercial investments. The organization is launching economic development programs that would invest in the development, redevelopment and acquisition of commercial properties and new buildings for commercial corridors, for which many parishes will be able to apply.

She said that significant improvements have been made to the state’s public infrastructure, but because the funding has been “a bit patchwork,” the state hasn’t yet been able to focus on improving the entire infrastructure system as opposed to a specific road or sewer.

New Orleans and St. Bernard Parish are in the process of building back their hospital systems, but in the interim, smaller community-based health centers have served a great purpose, Keegan said. “We have a significant challenge in that their post-Katrina funding has dried up. They’re seeking additional funding to ensure that we can keep the doors of those community facilities open as we try to rebuild the larger hospitals.”