What Ever Happened To The Underwater New Orleans Bus Fleet?
(AP Photo - Phil Coale)
New Orleans to Sell Flooded Buses on EBay - [NewsMax]
The competition - [eBay Motors]
Miss. Gov. Vetoes Bill to End Grocery Tax
Gov. Haley Barbour vetoed a bill Wednesday that would phase out a state sales tax on groceries and increase the tax on cigarettes.
"It's irresponsible to cut Mississippi's budget revenue while we're trying to recover from Hurricane Katrina," the Republican said.
Barbour, a former Washington lobbyist for tobacco companies, called the proposal "ill-conceived, barely researched, poorly timed and passed in great haste."
The bill, which zipped through the Senate and House at the start of the 2006 session, would eliminate the 7 percent grocery tax by 2014. [Read more - SFGate]
Katrina cited as deficit likely to top $400B
WASHINGTON (Reuters) -- The White House said on Thursday deficit spending in the 2006 budget would soar above $400 billion, well over a July forecast, and the election-year jolt was blamed largely on Hurricane Katrina costs.
The new deficit projection was likely to further intensify a debate leading up to mid-term elections in November on whether to renew President George W. Bush's tax cuts that he says are essential for economic growth but which Democrats say are a drain on the budget.
The deputy director of the White House Office of Management and Budget, Joel Kaplan, said White House officials believed that by sticking to Bush's economic policies and spending restraint "we will return to our downward trajectory and remain on (a) path to cut the deficit in half by 2009." [Read more - CNN]
White House sees 2006 budget gap over $400 billion
WASHINGTON (Reuters) - The White House said on Thursday deficit spending in the 2006 budget would soar above $400 billion, well over a July forecast, and the election-year jolt was blamed largely on Hurricane Katrina costs.
The new deficit projection was likely to further intensify a debate leading up to mid-term elections in November on whether to renew President George W. Bush's tax cuts that he says are essential for economic growth but which Democrats say are a drain on the budget.
The deputy director of the White House Office of Management and Budget, Joel Kaplan, said White House officials believed that by sticking to Bush's economic policies and spending restraint "we will return to our downward trajectory and remain on (a) path to cut the deficit in half by 2009." [Read more - abcNews]
Storms hit Louisiana, Mississippi bank profit-FDIC
WASHINGTON, Jan 10 (Reuters) - Banks in Louisiana and Mississippi suffered significant earnings declines in the months immediately following hurricanes Katrina and Rita, but they may not feel the full extent for some time, the Federal Deposit Insurance Corp. said on Tuesday.
In Louisiana, which lost a net 223,000 jobs in August and September, median return on assets for state headquartered institutions dipped to 1.09 percent in the third quarter of 2005 from 1.14 percent in the previous quarter and 1.12 percent a year earlier, the FDIC said in its latest state banking profiles report.
In the hard-hit New Orleans and Lake Charles areas, median return on assets dropped to 0.67 percent from 0.88 percent in the second quarter, FDIC said, citing higher loan loss provisions and overhead likely related to clean-up and repair costs. [Read more - Reuters]
Tourists Trickling Back to New Orleans
NEW ORLEANS (AP) - The paddlewheeler on which they had planned to take a Mississippi River excursion was being used to house Hurricane Katrina relief workers. But Phoenix residents Barbara Levy and Skip Hanson still had French Quarter antique stores and restaurants to enjoy.
"New Orleans will get going when tourism gets going. It's got to start somewhere. Why not us?'' Levy said last week.
Four months after the storm, tourists are trickling back to New Orleans, a city that has always depended on the kindness of strangers.
"They're coming from as far away as Germany, as far away as Paris, as far away as who-knows-where,'' Mayor Ray Nagin said Friday at a ceremony to mark the start of Carnival season, which culminates in Mardi Gras, the city's biggest moneymaker. [Read more - Gaurdian]
Louisiana gets its first FEMA bills, totaling $156 million
BATON ROUGE, La. (AP) — Louisiana's first bills from FEMA for its share of federal hurricane recovery efforts arrived over the holidays, and they were a doozy: $155.7 million, with a 30-day due date before interest starts accruing. And more bills are expected to arrive in the coming months as federal officials tally their costs after hurricanes Katrina and Rita.
States are required to pick up part of the cost for certain types of disaster aid from the Federal Emergency Management Agency, including repairs to state infrastructure, efforts to minimize future damage from storms and some assistance for individuals.
Louisiana's Office of Homeland Security and Emergency Preparedness received collection statements from FEMA on Dec. 29 for $139.7 million in aid for Hurricane Katrina and $16 million for Hurricane Rita. [Read more - NOLA]
New Orleans Company Plans a Tour of the Catastrophe
"The Hurricane Katrina Tour - America's Worst Catastrophe" is scheduled to begin Jan. 4, and a ticket for the narrated three-hour excursion will sell for $35.
It is being offered by Gray Line New Orleans, whose general manager, Gregory Hoffman, was among those who lost their homes. He said that he had to trim his work force to 6 from 65, and that he hoped the tour would resuscitate business and give tourists what they want. Mr. Hoffman said $3 from each ticket would be donated to one of five nonprofit recovery groups of the customer's choosing.
The tour will include the levees, Canal Street, the Superdome, the New Orleans Convention Center and the Lakeview neighborhood, where Mr. Hoffman lived. The tour will run once a day, Wednesday to Sunday until Feb. 27 (the day before Mardi Gras), and Gray Line will use a 25-seat bus instead of a full-size coach. [Read more - NYTimes.com] [Link to Gray Lines Katrina Tour]
Small-business loans not reaching gulf area
NEW ORLEANS - Donald Johnsen is trying to hold it all together. "I found my truck on top of my car,” he remembers. “My car was in my kitchen."
Hurricane Katrina not only destroyed his house, but wiped out a third of the Louisiana businesses he supplied with coffee. "I haven't had a salary since Katrina hit, Johnsen says, “and I don't see getting a salary until probably the end of February, if even then."
To keep small businesses like Johnsen’s alive after a disaster, the Small Business Administration provides low-interest loans. But of the more than 326,000 applications in the four months since Katrina, only 37 percent have been processed and only 7 percent — just over 24,000 — of loan applicants have gotten any money at all. [Read more - MSNBC]
Day 107 – 12/6/05, 20,000 New Homes For New Orleans
(AP) The first major housing investment in the New Orleans region since Hurricane Katrina will come from a California home builder planning a community with as many as 20,000 homes.
The venture, called KB Home/Shaw Louisiana LLC, would build new homes "with the goal of providing permanent housing and increased economic development" in Louisiana, the companies said in a statement on Tuesday.
"We want to rebuild New Orleans," said Bruce Karatz, chairman and chief executive of KB Home, which has partnered with The Shaw Group of Baton Rouge to buy a 3,000-acre tract near Avondale in Jefferson Parish. [Read more - CBSnews]
Day 81 – 11/10/05, Bill proposes a 'sales tax holiday' for three days in December
Hurricane-stricken Louisiana residents need a three-day holiday from state sales taxes next month, a House committee decided on Thursday.
Gov. Kathleen Blanco had pushed for one tax-free day, on Dec. 10, an idea endorsed this week by a Senate committee. But the House Ways and Means Committee decided to expand it and make it voluntary, so small businesses could decide whether to go through the cost of reprogramming their cash registers. Shoppers would not pay sales taxes on most purchases under $2,500 from Dec. 9-11, according to the bill.
The idea met with opposition from lawmakers who represent the areas hardest hit by Hurricane Katrina. They argued that the money the state would lose in tax revenue should instead be spent on housing and getting displaced residents back to Louisiana. [Read more - WWLTV]
Day 67 – 10/27/05, Official: Louisiana public hospital system on verge of collapse
WASHINGTON -- Two months after Hurricane Katrina, Louisiana's public hospital system is on the verge of financial collapse unless federal aid is forthcoming quickly, the head of the system said Thursday.
"We're out of money, roughly after Thanksgiving," said Donald Smithburg, chief executive of the LSU Health Care Services Division told reporters. "We are running out of time."
Smithburg said the system, Louisiana's largest health care provider with 1.2 million patients annually before the storm, will have to furlough 2,900 of its 8,000 employees next week, the first step toward permanent layoffs on Dec. 17.
Two of the system's nine hospitals, Charity and University in New Orleans, have been closed since they were severely damaged in the storm. They are the system's two biggest hospitals and include one of only two trauma care units in the state. [Read more - WWL]
Day 44 – 10/4/05, New Orleans Fires 3,000 City Workers
In a candid acknowledgement of New Orleans' dreary economic condition, Mayor Ray Nagin dispensed pink slips to half the city's work force Tuesday and conceded that additional layoffs could loom.
The bad news was slightly mitigated with an upbeat assessment from Nagin about the improving quality of city water. West Bank water already is.
Nagin said he will then determine if "we'll have to make another tough call."
It's tough. The layoffs were expected but nonetheless flew in the face of Nagin's recent efforts to paint New Orleans as a city slowly regaining its footing. "The reality is this city will not be the same for a while," Nagin said. Nagin staffers were unable to provide a breakdown Tuesday of how the layoffs will impact individual city agencies. Nagin said city workers singled out for layoffs will receive their last paychecks Oct. 14 and Oct. 21, depending on which pay cycle they're in. Nagin said the city is not contemplating bankruptcy at this time, adding that the strained city budget could get temporary relief if the Legislature accepts a recommendation by state Treasurer John Kennedy and agrees to assume City Hall's debt service.
Nagin said the water board is testing the water daily at the treatment plant and that "it exceeds standards." But the water is being corrupted as it runs through the city's delivery system, severely damaged in some places. Nagin said an "army of workers" is making significant progress on repairs to water pipes.
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Day 40 – 9/30/05, The Katrina Real Estate Rush
BILOXI, Mississipp (AP) -- Rubble piles bear "For Sale" signs. Homes without roofs are being sold as-is. Placards announcing "We Buy Houses, Cash!," are posted on corners throughout middle-class neighborhoods.
The Mississippi coast, wracked by Hurricane Katrina, is caught up in a real estate rush, as speculators and those looking to replace their own wrecked homes pinpoint broken and battered waterfront neighborhoods. In the weeks since the hurricane, prices of many homes -- even damaged properties -- have jumped 10 to 20 percent.
But what Katrina spared, the real estate rush now imperils. The arrival of speculators threatens what's left of bungalow neighborhoods that are among the Gulf's oldest communities, close-knit places of modest means where casino workers, fishermen and their families could still afford to live near the water. [Read more - CNN]
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Day 36 – 9/26/05, FEMA Plans to Reimburse Faith Groups for Aid
Civil libertarians object; religious groups ponder what to do
After weeks of prodding by Republican lawmakers and the American Red Cross, the Federal Emergency Management Agency said yesterday that it will use taxpayer money to reimburse churches and other religious organizations that have opened their doors to provide shelter, food and supplies to survivors of hurricanes Katrina and Rita.
FEMA officials said it would mark the first time that the government has made large-scale payments to religious groups for helping to cope with a domestic natural disaster.
Civil liberties groups called the decision a violation of the traditional boundary between church and state, accusing FEMA of trying to restore its battered reputation by playing to religious conservatives.
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Day 37 – 9/27/05, LA. Gives Back Much of FEMA Money
BATON ROUGE - The Department of Health and Hospitals has declined the bulk of $352 million in disaster assistance handed to the state by the Federal Emergency Management Agency late last week, with agency officials saying that they spent only about $10 million during the aftermath of Hurricane Katrina.
The $352 million showed up in a list of projects approved by FEMA totaling $457 million, which was deposited by the federal government last week in the state of Louisiana's bank account. But the state health department has taken only the roughly $10 million that they are entitled to so far, said Bob Johannessen, the spokesman for the agency.
"We are obligated under federal law to return that money. That is what we did," said Johannessen, who noted that the agency is supposed to take only what it has actually spent.
He said that the health department eventually expects to spend about $60 million in dealing with Katrina, including such costs as the shelters and triage centers set up to evaluate people evacuated from the flooded New Orleans area. Agency officials expect to request that FEMA eventually pick up the whole tab for those kinds of items, Johannessen said. [Read more - NOLA]
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Day 36 – 9/26/05, Louisiana to Seek $31 Billion-Plus in Reconstruction Funds From Feds
BATON ROUGE, La. -- Louisiana officials will ask Congress for more than $31 billion to rebuild and improve levees and major roadways damaged by hurricanes in the past month, Gov. Kathleen Babineaux Blanco said Sunday. Blanco said more than $20 billion will be needed to beef up levees and pump stations from Morgan City north and east to New Orleans and Slidell, around the shores of Lake Pontchartrain and in the Atchafalaya River basin. Another $11.5 billion will be needed for road work, including the replacement of the Interstate 10 causeway between New Orleans and Slidell, the improvement of major evacuation routes and repairs to ports and airports damaged by hurricanes Katrina and Rita.
New Orleans Utility Could File for Bankruptcy Protection
BATON ROUGE — Facing huge costs for rebuilding its Hurricane Katrina-devastated systems along the Gulf Coast, utility giant Entergy (ETR) said Tuesday that it will consider filing for bankruptcy protection for its New Orleans unit.
Entergy, whose Entergy New Orleans unit has lost up to an estimated 130,000 customers because of the hurricane, estimates the unit's storm-related costs at $325 million to $475 million.
The company put its total estimated costs for repairing and replacing electric and gas facilities damaged by the Aug. 29 storm at $750 million to $1.1 billion.
New Orleans-based Entergy delivers electricity to 2.7 million customers in Arkansas, Louisiana, Mississippi and Texas and provides natural gas to nearly 240,000 customers in Louisiana. [Read more - USA]
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Day 29 – 9/19/05, Energy Companies Start Evacuating Gulf Again; Oil Prices Leap in 'One of Largest Moves'
Energy companies – still struggling to restore oil and gas platforms in the Gulf of Mexico after Hurricane Katrina – have begun shutting down operations and evacuating personnel in advance of Tropical Storm Rita.
Crude oil prices jumped 7 percent and natural gas prices closed 14 percent higher Monday in anticipation of further pinched oil and gas supplies.
Oil companies began bringing construction workers and project crews ashore Sunday in the first wave of personnel clearing from platforms and drilling rigs in the Gulf. Major oil companies with operations in the deep water Gulf launched the earliest evacuation.
Rita is expected to race through the heart of the Gulf, where energy operations ravaged by Katrina three weeks ago have not been restored to full operation. The damage affected all aspects of the energy supply chain from drilling rigs to gas processing plants and oil refineries which produce gasoline. [Read more - NOLA]
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Day 29 – 9/19/05, 25 Percent of N.O. Area Restaurants Might not Come Back
BATON ROUGE—An estimated quarter of the 3,400 restaurants in the New Orleans area will probably not reopen in the wake of Hurricane Katrina because of the cost of insurance, or cash-flow or staffing issues, the chief executive officer of the Louisiana Restaurant Association said Monday.
Jim Funk said that the 25 percent projection is a minimum number and could increase.
Most of the casualities, he said, will probably not be the established restaurants like Commander’s Palace or Galatoire’s, but the “mom-and-pop restaurants’’ that dot New Orleans area neighborhoods.
He said by the end of Monday there were no more than 75 of the area’s 3,394 restaurants open.
“The (financial) losses will be staggering,’’ Funk said. [Read more - NOLA]
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Day 29 – 9/19/05, Clinton: Bush Should Raise Taxes to Pay for Recovery
WASHINGTON (CNN) -- Former President Clinton believes the Democrats should pounce on and exploit President Bush's refusal to hike taxes to finance Hurricane Katrina relief efforts and the wars in Iraq and Afghanistan.
"They should continue to oppose it, and they should make it an issue in the 2006 election, and they should make it an issue in the 2008 election," said Clinton, interviewed on Sunday by George Stephanopoulos on ABC's "This Week."
"I think it's very important that Americans understand... tax cuts are always popular, but about half of these tax cuts since 2001 have gone to people in my income group, the top 1 percent. I've gotten four tax cuts. They're responsible for this big structural deficit, and they're not going away, the deficits aren't."
Clinton said America's deficit has forced the United States to borrow "money from other countries to finance Iraq, Afghanistan, Katrina, and our tax cuts."
"We have never done this before. Never in the history of our republic have we ever financed a conflict, military conflict, by borrowing money from somewhere else." [Read more - CNN]
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Day 29 – 9/19/05, French Quarter Merchants Trickle Back to Begin Cleanup
NEW ORLEANS — This deserted city's human tide began to turn Saturday as merchants and landlords were officially allowed back into the French Quarter for the first time.
But a weakened levee system and a lack of drinkable tap water will make it "extremely problematic" to follow the New Orleans mayor's timeline for allowing residents to return, the head of the federal disaster relief effort said Saturday.
The narrow streets and brick sidewalks normally filled with revelers were crowded with owners and others dealing with hurricane hangovers: cleanup crews, soldiers and police, utility workers, relief volunteers, furniture vans, garbage trucks and TV mobile satellite trucks.
As the returnees passed through checkpoints, they were handed a printed warning: "You are entering at your own risk." The two-page document urged wariness about everything from E. coli bacteria to broken traffic lights. [Read more - Palm Beach Post-Cox News Service]
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Katrina May Cost as Much as Four Years of War
WASHINGTON - One storm could end up costing almost as much as two wars.
Although estimates of Hurricane Katrina's staggering toll on the treasury are highly imprecise, costs are certain to climb to $200 billion in the coming weeks. The final accounting could approach the more than $300 billion spent in four years to fight in Afghanistan and Iraq.
Analysts inside and outside government agree that the $62 billion that Washington has spent so far was merely the first installment of perhaps an unparalleled sum. [Read more - MSNBC]
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Cost of Recovery Surges, as Do Bids to Join in Effort
WASHINGTON, Sept. 8 - With Congress primed to spend billions of dollars on the aftermath of Hurricane Katrina, lawmakers and industry groups are lining up to bring home their share of the cascade of money for rebuilding and relief.
White House officials and Congressional budget experts now assume that federal costs for the hurricane will shoot past $100 billion, which itself is more than twice the entire annual federal budget for domestic security. Congress on Thursday approved $51.8 billion in spending, bringing the total so far to more than $62 billion.
The demand for money comes from many directions. Louisiana lawmakers plan to push for billions of dollars to upgrade the levees around New Orleans, rebuild highways, lure back business and shore up the city's sinking foundation. The devastated areas of Mississippi and Alabama will need similar infusions of cash.
Communities will want compensation for taking in evacuees. And there will be future costs of health care, debris removal, temporary housing, clothing, vehicle replacement. Farmers from the Midwest, meanwhile, are beginning to press for emergency relief as a result of their difficulties in shipping grain through the Port of New Orleans. [Read more - New Your Times]
Again, help the Red Cross help others. Give generously. Thanks!Day 16 – 9/7/05, Katrina Could Cost 400,000 Jobs
Congressional Budget Office says storm could also knock up to 1 percent off economic growth.
NEW YORK (CNN/Money) - Hurricane Katrina could cost the U.S. over 400,000 jobs and shave up to 1 percent off the nation's economic growth in the second half of the year, the Congressional Budget Office said.
The CBO said much of the loss will come from disruption of oil production. It added that the economy, growing at a projected rate of 3.7 percent in 2005, had been growing steadily at the time of the storm.
"The devastation in the Gulf Coast region is unlikely to knock the economy far from that course," the CBO said in a letter to Senate Majority Leader Bill Frist, dated Wednesday. "While making specific estimates is fraught with uncertainty, evidence to date suggests that overall economic effects will be significant but not overwhelming."
The estimate from the CBO, the non-partisan budget arm of Congress, comes as economists and policy-makers wrestle with the economic impact of the storm. [Read more - CNN Money]
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Day 10 – 9/1/05, Katrina Aaftershocks: Biz Roundup
We'll see the effect at the gas pump almost immediately, but effects will continue to widen.
NEW YORK (CNN/Money) - As rescuers continue to try to save people trapped in New Orleans and get relief to those evacuated, Wall Street is looking at how the storm will affect business, the markets and the economy. Here's the latest news on how they are responding, and what market watchers should look for in the coming weeks.
Oil shortage
Energy Secretary Samuel Bodman said Wednesday that the White House plans on tapping the nation's Strategic Petroleum Reserve to help refiners hurt by Hurricane Katrina. [Read more]
Gas, and the economy it fuels
Consumers can expect retail gas prices to rise to $4 a gallon soon, but whether they stay there depends on the long-term damage to oil facilities, oil and gas analysts said Wednesday. [Read more]
The devastation of Hurricane Katrina will also take a big bite out of job creation for months to come, analysts said, as companies spending more on energy spend less on hiring. [Read more]
The president of the Federal Reserve Bank of Philadelphia said that Katrina would "slow but not stall" economic growth, noting that the U.S. economy has proven to be very capable of absorbing shocks. [Read more]
Corporate earnings
Analysts expect Katrina to take a big bite out of corporate earnings, except in the energy and construction sectors, as high energy prices hit consumer spending and corporate budgets. [Read more]
Insurance
Hurricane Katrina is expected to be one of the costliest U.S. storms for insurers, but risk forecasters are deeply split about the extent of the damage. Insured losses may total as much as $25 billion, but insurers' stocks have held up well, with the S&P insurance index falling less than 1 percent this week. [Read more]
Again, help the Red Cross help others. Give generously. Thanks!Day 9 - 8/31/05, Oil Rises, Gasoline Sets Record on Hurricane Katrina Damage
Aug. 31 (Bloomberg) -- Crude oil rose for a third day and gasoline reached a record after Hurricane Katrina ripped through the U.S. Gulf coast, shutting oil and gas production, creating fuel shortages and threatening to cause $25 billion of damage to the U.S. economy.
``You're probably going to have problems getting some of these refineries started again,'' said Tony Nunan, an assistant general manager at Mitsubishi Corp. in Tokyo. ``The U.S. just doesn't have enough refineries. You are going to see $3 gasoline at the pump.''
To ensure supplies, oil refiners and fuel wholesalers across most of the U.S. started rationing deliveries to filling stations and convenience stores, while tanks ran dry at some terminals in the Midwest, South and Southeast. The storm's death toll may reach into the hundreds as rescue efforts continued and looting broke out in New Orleans, where the National Guard patrolled the streets in a bid to preserve order.
Crude oil for October delivery today rose as much as 82 cents, or 1.2 percent, to $70.63 a barrel in after-hours electronic trading on the New York Mercantile Exchange. It was at $70.54 at 8:33 a.m. London time. Yesterday, it reached $70.85, the highest since the contract started trading in 1983. [Read more]
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Day 6 - 8/28/05, OPEC President to Propose Oil Output Hike
KUWAIT - OPEC President Sheikh Ahmad al-Fahd al-Sabah said on Monday he will propose the cartel raise its output by 500,000 barrels per day when the group meets in September in an attempt to help cool oil prices at record highs.
Sheikh Ahmad, also Kuwaiti oil minister, said he will also propose a 500,000 bpd increase in the group’s official output ceiling at the Sept. 19 meeting.
“We hope that the resolution to the board to increase production and the ceiling, 500,000 (bpd) and 500,000 (bpd), and to refresh the dialogue with all the main consumers, I hope this will at least help the market and the prices to be more stable,” Sheikh Ahmad told reporters.
Oil prices hit a record $70.80 a barrel on Monday as Hurricane Katrina headed towards U.S. oil and gas production in the Gulf of Mexico.
Prices eased from that peak to around $69, but Sheikh Ahmad’s comments failed to bring them lower still.
“The market is well supplied,” Sheikh Ahmad said. “There is about or over one million bpd (oversupply) in the market.”
“If we talk about demand and supply and other economic factors I don’t think prices will reach $100 or even deserve to be near $70,” he said.
“But if we talk about other issues or realities which play a role in the price increases like geopolitics, refinery problems or psychological problems...then prices may cross $100.”
Day 7 - 8/29/05, 1-Insurer Shares Drop as Hurricane Katrina Nears US
ZURICH, Aug 29 (Reuters) - Shares in insurers dropped across the board in early trade on Monday as markets feared the sector may have to foot a hefty bill from powerful hurricane Katrina, which is about to hit the United States. [link]