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Bush, Louisiana at Odds over Reconstruction Plan

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Bush, Louisiana at Odds over Reconstruction Plan

Katrina & Beyond

Bush, Louisiana at Odds over Reconstruction Plan

Bush, Louisiana at Odds over Reconstruction Plan

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Officials in Louisiana are disappointed by President Bush's decision not to support a comprehensive plan for rebuilding New Orleans and the surrounding areas. The proposal, now in Congress, would set up a corporation funded by government-backed bonds that would buy and sell properties in flooded neighborhoods.

RENEE MONTAGNE, host:

Officials in Louisiana are disappointed by Pres. Bush's decision not to support a comprehensive plan for rebuilding New Orleans and the surrounding areas. The proposal, now in Congress, would set up a corporation funded by government-backed bonds that would buy and sell properties in flooded neighborhoods.

NPR's Greg Allen reports.

GREG ALLEN, reporting:

Louisiana is a state famous for its diverse cultural interests and political rivalries. That's why the near unanimous support in the state for a bill offered by Congressman Richard Baker, a Republican from Baton Rouge, has been, well, surprising. It's support that's based on a stark reality. New Orleans, even after it rebounds from Hurricane Katrina, is expected to just half of its former size. Some neighborhoods may have to be bulldozed, and the city downsized onto a new, smaller footprint.

The Baker bill would set up a corporation that would help New Orleans and other communities move people out of badly damaged neighborhoods, and relocate them to areas that will be rebuilt. But this week, the plan ran into trouble. Donald Powell, the president's coordinator for Gulf Coast Rebuilding, told Louisiana officials that the administration would not support the plan, because it would create a new federal bureaucracy.

Mr. DONALD POWELL (Coordinator, Gulf Coast Rebuilding): I think we would all be served better if the government did not get into the real estate business, and leave that to the private sector.

ALLEN: Powell was in New Orleans yesterday, talking about the recent passage of $11.5 billion in block grants for hurricane affected areas, including 6.2 billion dollars for Louisiana.

Andy Coplan heads the Louisiana Recovery Authority, the state body overseeing rebuilding across the state. He notes that, of that $11.5 million, Louisiana is receiving just over half.

Mr. ANDY COPLAN (Head of Louisiana Recovery Authority): And no one believes that Louisiana suffered only 54 percent of the damage.

ALLEN: Coplan says the Baker plan would provide not just extra funds, but also a mechanism for redeveloping entire neighborhoods.

In Mississippi, Governor Haley Barbour has said the five billion dollars his state is receiving in block-rent funds will be used to help owners with houses destroyed in areas where flood insurance was not required. Louisiana officials say that solution won't work in their state, where the flooding was more extensive, and more than 200,000 homes were destroyed.

White House Building Coordinator Don Powell says Louisiana can come back later for more funding requests, but, that like Mississippi, the state should first take care of the 20,000 people whose houses were destroyed, and who lived outside of the flood plane.

Mr. POWELL: I think the homeowner clearly is the person here that should be first in line; the homeowner whose home was outside the flood plane, and his home was destroyed, and did not have flood insurance.

ALLEN: That suggestion doesn't sit well with officials in New Orleans, who want a more comprehensive solution to the massive task in front of them, and who are equally concerned about what will happened to the tens of thousands destroyed homes that were in the flood plane.

Louisiana Recovery Authority board member Shawn Riley says many of those homeowners did not have flood insurance.

Mr. SHAWN RILEY (Board Member, Louisiana Recovery Authority): I know it's in the tens of thousands of people who did not have flood insurance, relied on the levees, and are now wiped out. I can't, in good conscious, reserve aid only for those who were outside the flood plane.

Congressman Baker said, despite that lack of support, he's pushing forward with his plans, and hopes soon to win passage in Congress. Other leaders in the state agree, but say it may be time to start thinking about Plan B: how to rebuild New Orleans and Louisiana without relying on support from White House.

Greg Allen, NPR News.

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