A Tortured Path to Recovery
What happened to all that money that was supposed to rebuild the Gulf Coast?
Other bureaucratic speed bumps and nasty fights over jurisdiction have also contributed to delays. "The state people say it's the feds; the feds say it is the states," says Melancon. "They're pointing at each other, and I'm not getting answers." The most discussed piece of red tape is the Stafford Act, a 30-year-old federal law intended to combat corruption, which requires local governments to pay 10 percent of the cost of many federally financed reconstruction projects. The theory is simple: Local officials won't squander money if their own dollars are at stake. "The purpose of the match," says Donald Powell, the president's coordinator of Gulf Coast issues, "is so that they have ownership." In practice, however, local governments in the Gulf Coast find themselves in a bind because they don't have the money to pay for the match, and they've turned to money from another federal account to pay the 10 percent.
Some in Congress and Louisiana wonder if there isn't perhaps a subtext to the lack of progress underlying the bureaucratic wrangling. Louisiana has a lengthy and colorful history of public corruption that may still raise some eyebrows. And publicly, some critics, including House Majority Whip Jim Clyburn, claim the response would have been faster and better if the demographics of the affected areas had been different; New Orleans was more than two-thirds black the day Katrina struck. Federal officials have long said these charges were nonsense.
Newly empowered Democrats on Capitol Hill have a bunch of changes in mind. They've scheduled an aggressive Senate oversight hearing on Road Home this week. And they've passed 12 Katrina-related bills in the House, six of which would provide an additional $6.8 billion in funds for recovery efforts and would also waive the 10 percent requirement. But the future of those six is uncertain, as they are attached to the controversial Iraq war funding bill that is caught between Congress and the White House. Aside from Iraq questions, the Bush administration has some reservations about the increased spending and the waiver. Powell says Louisiana officials "haven't spent what they've got. They need to spend it wisely, prudently, and then we'll see" about more money.
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