New Orleans Still Awaits Billions of Dollars in Promised Federal Aid, Year After Katrina

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New Orleans Awaits Billions in Fed Aid
New Orleans Still Awaits Billions of Dollars in Promised Federal Aid, Year After Katrina
By MICHELLE ROBERTS
The Associated Press

NEW ORLEANS - First came the floodwaters, then the paperwork. Billions of promised federal dollars to fix New Orleans' crumbling infrastructure have gone largely untapped a year after Hurricane Katrina. City officials complain that a snarl of red tape, restrictions and unexpectedly high costs have kept hundreds of public buildings in disrepair, streets pocked with potholes and most parks too dirty for children to play.

"It's an incredible bureaucracy. It's unbelievable," Mayor Ray Nagin said in an interview with The Associated Press this week.

So far, the city has collected only $117 million to start the repair work in what has been billed as the largest urban restoration in U.S. history.

For every repair project, city officials must follow a lengthy application process and spend their own money before getting a dime of federal aid to fix at least 833 projects such as police stations, courtrooms, baseball fields or auditoriums.

Residents don't care much what the cause is. They're just tired of crater-like potholes, sudden drops in water pressure and debris-clogged storm drains.

"We're not asking for a lot. At this point, we're just looking for basic services: power, gas, water. Sewer that doesn't back up into your house would be nice too," said Jeb Bruneau, president of the neighborhood association in the Lakeview area. "Whatever the snafu was, the result is Joe Blow Citizen isn't seeing the effect of that federal money."

Louisiana eventually expects to get at least $25 billion in federal money for rebuilding projects, including everything from levee repairs to homeowner assistance. Of that money, $6 billion to $8 billion will be doled out statewide to repair broken roads, schools, water pipes and countless other problems.

But to get the money, the city and other agencies such as the Sewerage and Water Board, the Regional Transit Authority and Orleans Parish School Board must fill out worksheets for every construction project.

The worksheets are submitted to FEMA, which determines whether the project is eligible for federal aid. If approved, the federal government releases the approved money to the state, but the local government fronts the money to have the work done. After that, the local government can submit receipts for reimbursement.

The process takes months and can be further complicated if costs surpass the original request a particular concern in New Orleans because of shortages of materials and construction workers.

It also requires the city have cash to pay upfront, forcing money to be diverted from other parts of the budget.

President Bush has acknowledged the problems posed by excessive bureaucracy.

"To the extent that there still are bureaucratic hurdles and the need for the federal government to help eradicate those hurdles, we want to do that," Bush said Wednesday at the White House. But he cautioned that rebuilding will take time.

FEMA has signed off on $4.8 billion worth of rebuilding in Louisiana and $1.7 billion in Mississippi so far, said Darryl Madden, a spokesman for FEMA's Gulf Coast recovery office. Louisiana's larger amount reflects a broader scale of destruction caused by two hurricanes, Katrina and Rita, and the concentration of damage in heavily populated areas.

The procedural requirements for local governments to collect federal aid are designed to ensure the money is spent properly, Madden said.

"We are dealing with very, very large dollars. There has to be accountability," he said.

In the meantime, some federal aid has started to arrive.

About $6 billion has been allocated to the Army Corps of Engineers for repairs to the New Orleans flood-control system, and the first bit of the $8.1 billion to help homeowners repair or move from flooded-out homes was given out this week.

The money for the homeowner program was slower to arrive in Louisiana than in Mississippi because Mississippi was quicker to submit a plan that demonstrated checks and balances on the funding.

The process for seeking federal infrastructure aid is the same for governments across the Gulf Coast. For instance, Bay St. Louis, Miss., needs at least $70 million in repairs, and it's still waiting for federal and state help.

"There's just so much red tape on it," Mayor Eddie Favre said. "It's slowing some things down. It's a lot of headaches and heartaches if nothing else."

Associated Press writers Rukmini Callimachi in New Orleans and Michael Kunzelman in Gulfport, Miss., contributed to this report.