Bill includes unprecedented flood aid

Elizabeth Chuck Reporter • Profile • E-mail

A Senate vote expected this week could bring unprecedented government aid to Gulf Coast residents who did not purchase flood insurance because they lived outside high-risk areas, but whose homes were ravaged by Hurricane Katrina nevertheless.

Residents whose homes were in designated federal floodplains were required to buy flood insurance ahead of Katrina, which struck the Gulf Coast on Aug. 29. People living outside those zones were not required to purchase flood insurance, but could have done so if they had wished.

Now thousands of uninsured homeowners are facing the possibility of foreclosures because the storm destroyed or damaged their houses.

The vote, which may come as early as Wednesday, could bring as much as $11.5 billion to these uninsured flood victims in Mississippi and Louisiana.

Adam Sharp, a spokesman for Sen. Mary Landrieu, D-La., said this is the first time the government has done this.

“I believe it’s unprecedented, but it’s also an unprecedented disaster,” he said. “The homes in question did not have flood insurance. The reason is because the federal government told them they didn’t need it.” The government, Sharp said, has a responsibility to pay for its mistake.

The relief still faces serious hurdles in the Senate. It was tacked onto a broad $453 billion defense budget bill. That bill also includes several unrelated measures that are controversial and could bring down the whole bill, including authorization to drill for oil in the Arctic National Wildlife Refuge in Alaska and compromise language for a ban on cruel treatment of terrorism detainees.

Most Democrats oppose the ANWR provision, but it has support from both Republicans and Democrats in Louisiana: If drilling is approved, it would bring federal oil revenues to the Gulf Coast.

“Cutting ANWR would mean cutting about $6 billion in hurricane protection and coastal restoration in Louisiana,” Sharp said.

The pending relief plan, led by Sen. Thad Cochran, R-Miss., would set aside $11.5 billion in the form of Community Development Block Grants to the affected states.

The grants give the states considerable flexibility on how to use them. Mississippi officials have said they plan to use the grants to bail out homeowners who didn’t purchase flood insurance because the government didn’t force them to buy it.

Beau Gex, district chief of staff for Rep. Gene Taylor, D-Miss., estimated 35,000 homes in his state fall under this category. Mississippi is expected to receive about $5 billion of the grant.

Up to $150,000 apiece
That would mean homeowners could receive up to $150,000 for repairing or replacing their flood-ruined homes despite not having flood insurance.

Louisiana officials say they intend to use at least a portion of their grant money for the same purpose, Sen. Landrieu's spokeperson said some of the money also would likely be used to rebuild damaged infrastructure.

“My expectation is that the state government will use it for a variety of purposes toward rebuilding communities,” including housing, vehicles, hospitals and schools, he said. “In Louisiana, the damage to core infrastructure was even more disproportionately affected than in Mississippi, so the need is much greater for the wider use of funds.”

Andy Kopplin, executive director of the governor-appointed Louisiana Recovery Authority, said he regretted that Louisiana cannot give more to flood victims.

“Unfortunately, we have nearly two-and-a-half times more homeowners without flood insurance who were out of the floodplain and lost their houses than in Mississippi,” Kopplin said, adding that more than 70,000 homeowners in Louisiana were affected, while in Mississippi fewer than 30,000 were.

“We are evaluating how much we can do to help them,” he said.

The biggest chunk of the grant would go toward housing, the authority’s spokeswoman, Catherine Heitman, said.

The legislation states that no more than 54 percent of the Community Development Block Grant money can go to either of the two states, Jenny Manley, spokesperson for Sen. Cochran, said.

MORE FROM KATRINA: THE LONG ROAD BACK

Katrina: The Long Road Back Section Front

Apologetic Nagin visits N.Y. Bush sees rebirth from ‘sadness’ of Katrina Special report: Rebuilding lives Katrina exodus felt far and wide A tangled tale of Katrina survival ‘New Orleans is still crying’ Brian Williams: We were witnesses Developers' past includes fraud Special report: Rising from Ruin Dateline video blogs: Covering Katrina Katrina: The Long Road Back Section Front   Add Katrina: The Long Road Back headlines to your news reader: