Monday, November 21, 2005

Gulf Coast officials worry that feds won't pick up recovery tab

Mon, Nov. 21, 2005
The Washington Post
WASHINGTON -- The federal government has spent or obligated through contracts more than $18 billion in Hurricane Katrina relief, meaning that in just over two months, storm recovery costs have already drawn even with the record spending package the United States has been using to fund Iraq reconstruction for the past two years.

But local, state and federal officials say that number pales in comparison with the ultimate price tag for rebuilding the Gulf Coast. Until now, major expenses have come in the form of debris removal, temporary housing and direct assistance to those victimized by the storm. The real big-ticket items, they say, will not come until months and years down the line as the government attempts to re-create a public infrastructure network -- including roads, bridges, hospitals, schools, sewers, power lines, ports and levees -- that was decimated when Katrina swept in at the end of August.

"I hate to use the term 'drop in the bucket,' but that's pretty much what it's been," said Arthur Jones, who heads Louisiana's disaster recovery division. "This is going to be expensive. My mental calculator doesn't go that high."

No one else has come up with a definitive estimate, either. Guesses tend to range well above $100 billion but vary wildly from there.

Rebuilding the levees in New Orleans to the level that state and local leaders want is expected to cost $20 billion or more. Many roads, including a bridge that forms part of Interstate 10, have to be rebuilt entirely. Labyrinths of underground cables, wires and pipes that spent weeks corroding in the dank floodwaters have to be replaced. And thousands of buildings have to be leveled to make way for fresh construction.

There is widespread agreement on who will end up receiving that money: the companies that make their living doing architecture, engineering and construction work for the government. Less clear is who will pay.

It is yet to be determined, for instance, just how much of a role the federal government will play in picking up the tab. "It depends on a threshold question: What are you going to rebuild? What is the federal responsibility for rebuilding a city, a metropolitan area or a region? This is where it gets really confused," said Bruce Katz, director of the metropolitan policy program at the Brookings Institution. "Federalism is a messy business."

In the immediate aftermath of the storm, Congress rushed to approve more than $60 billion in aid. President Bush offered assurances in a nationally televised address from New Orleans that the federal government would bear much of the financial burden.

Yet since then, fiscal conservatives in the Congress have begun to question whether the United States can afford to take on such an enormous expense at a time of mounting deficits. They knocked down legislation pushed by members of Louisiana's congressional delegation that would have authorized $250 billion in additional storm-related funding.

With the nation's attention shifting away from Katrina, the Bush administration has given indications it is listening to conservatives' concerns. When the White House late last month wanted $17 billion primarily to rebuild federal facilities and highways in the Gulf Coast, it requested that Congress take that money out of the existing reconstruction budget.
Meanwhile, state and local officials say they are growing increasingly concerned that the federal government will not put in the kind of money needed to rebuild the region. "We've always been a poor state, so this is something that can't be done without federal help," said Mark Drennen, president and chief executive of Greater New Orleans Inc. "For local businesses to survive, there's got to be a basic infrastructure in place. And that infrastructure is gone."

© 2005 Star-Telegram and wire service sources. All Rights Reserved.

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