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Where is the Money?



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Congress has appropriated $94.8 billion for recovery from Hurricanes Katrina and Wilma. It gave the National Flood Insurance Program rights to borrow $17 billion from the government to cover deficits from Katrina claim payouts.  The federal government also created a $16 billion Gulf Opportunity (GO) Zone tax credit program.  That all totaled some  $140 billion.

That money was shared by the five Gulf states:  Louisiana, Mississippi, Texas, Florida and Alabama.  Louisiana got the bulk of the NFIP money, but initially it received only $3.5 billion of the recovery money (over the course of three years that number has risen to some $13 billion).


Until the recent Wall Street bailout, this was a staggering sum of money - double the total federal dollars dispersed for all U.S. natural disasters since 1989 and, after adjusting for inflation, even more than spending for the Marshall Plan to help post-WW II Europe recover.


Whatever happened to people during Katrina, there was one thing that determined whether they'd be able to rebuild: Money.


The first recourse was through the National Flood Insurance Program, which had incurred more than  $20 billion in claims by the end of September.  The NFIP paid out their claims immediately, but for most, that money wasn't enough to rebuild. Others may not have purchased enough coverage.   For them, the states applied to HUD for Community Development Block Grant money.  In Louisiana, this became known as the Road Home program.


Separately, FEMA paid to rebuild schools, hospitals, state roads, and other local infrastructure through what is known as the Public Assistance program.  But a total of 52 federal agencies are also rebuilding federal highways, working with schools, rebuilding levees, and conserving wetlands.  Where is the money?








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David Walker, who was in charge of auditing how the government spends money says there’s no way to know what’s happened with the money appropriated for Katrina recovery.





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Post-Katrina, the state of Lousiana was only slightly better off than the city of New Orleans when it came to disbursing federal funds. Miraculously, as soon as Republican governor Bobby Jindal was elected, billions of dollars that had been stuck in the federal pipeline suddenly were freed.





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Gale Gettridge Branon had a succinct critique of the governmental failures during and following the disaster.




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Psychiatric EMT Cecile Tebo helped Big Easy residents who cracked mentally under the big strain of rebuilding....then suffered her own breakdown under the strain of fighting her insurance company.

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Comments (2)Add Comment
January 16, 2009

When will the money for this be solved ?

February 02, 2009

Can I see where the money was spent?

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