Posted on 10/26/2005 5:22:10 AM PDT by Libloather
City officials grilled on recovery process
Wednesday, October 26, 2005
By Bruce Eggler
Staff writer
New Orleans Mayor Ray Nagin takes a bite of a beignet (pastry) during the re-opening of the 153-year old Cafe Du Monde in the French Quarter of New Orleans, Louisiana, October 19, 2005. Wednesday is the first day of business for the New Orleans landmark since it was closed down due to Hurricane Katrina. REUTERS/Lucas Jackson
Members of a state legislative committee pressed New Orleans officials Tuesday for answers to a long list of questions about the status of post-Katrina recovery efforts and plans for reviving the city.
In many cases, legislators said, they ended up no more enlightened than before the hearing began, though they expressed appreciation for updates by acting Police Superintendent Warren Riley and other department heads.
Saying he has constituents whose homes are undamaged and whose neighborhoods have basic services but are closed to repopulation, state Sen. Edwin Murray, D-New Orleans, pushed Terry Ebbert, the city's homeland security director, for information about when more neighborhoods will be opened.
Ebbert said Mayor Ray Nagin "has determined not to put people in harm's way" in allowing residents back into neighborhoods, but he offered no clue when more areas will be reopened.
Murray and other legislators also asked about the status of plans for allowing rebuilding in heavily damaged neighborhoods.
**SNIP**
Ebbert said Nagin's "No. 1 priority in his battles with the federal government" is providing the basic services and temporary housing that will let more and more people return.
But Rep. Charmaine Marchand, D-New Orleans, and other legislators said the city needs to move faster to make trailers and other types of temporary housing available in the city.
(Excerpt) Read more at nola.com ...
New Orleans Mayor Ray Nagin, left, shares a laugh with New Orleans Hornets owner George Shinn courtside during the first quarter between Miami Heat and New Orleans Hornets Tuesday, Oct. 25, 2005, in Baton Rouge, La. (AP Photo/Bill Feig)
Did Bag-man Nagin ever try to encourage people to do things themselves? Naw - why try to be self reliant when Uncle will do it for you...Nagin loves the hi-life so don't rock the boat.
Don't you step on Hizzonor's steel-toed shoes.
I thought the cruise ships were a giant boondoggle! Now they don't know what they'll do without them?!
They need more jazz and mo money!
That photo is awesome.
I heard from a friend in the insurqance business that insurance comapnies are reluctant to provide coverage post-Katrina unless the city is rebuilt above flood level. They don't want to insure a definite loss situation. They are also reluctant to pay claims unless the owners rebuild higher than the flood, too. If the government won't take action, those that hold the insurance purse strings will set conditions so action must be taken. Anyone else hear or able to confirm this?
No mention of looting and beating investigations involving police.
It is awesome isn't it..I thank "Sacred Cow Burgers" for letting us use them..Just need more to choose from since this joker is trying to be the next Jesse Jackson with his lies and more lies..
You are so right with your comment..
NEW ORLEANS - Although Hurricane Katrina caused record insurance losses in Louisiana, so far no insurance company has said it will pull out of the state.
But that could change, depending on whether the Louisiana Legislature enacts a Florida-like stronger building code and the outcome of class-action lawsuits seeking to make insurance companies cover flooding caused by the failure of floodwalls atop New Orleans levees.
"The ball is in our court," said state Insurance Commissioner Robert Wooley. "Right now, none of the companies are writing new business, but they are waiting and watching."
There is a continuing question about the insurability of New Orleans after the floodwalls built for a Category 3 storm failed in a Category 4 storm and whether the Corps of Engineers and the Orleans Levee Board embark on upgrading the levees to withstand a Category 5.
Insurance companies will continue doing business in Louisiana only if they have to pay what they consider insured losses of just the more than $34.4 billion from Katrina and the undetermined losses due to Hurricane Rita.
"If the insurance companies only have to pay out what they are supposed to pay, they will be fine," said Jeff Albright, executive director of the Independent Insurance Agents Association. "The big, big question is what happens to these lawsuits."
There are already a number of lawsuits filed over the failure of the floodwalls atop Orleans levees, particularly the breach in the floodwall of the 17th Street Canal on the Jefferson-Orleans parish line near Lake Pontchartrain that, in effect, emptied the lake into New Orleans.
Private insurance companies don’t insure against rising water, but cover damage by wind and rains during hurricanes. Flood insurance is provided by the federal government, and some members of the U.S. Congress are questioning the continuation of the program in flood-prone areas. Property owners had the option of buying flood insurance from the federal government, but the policy limit is $250,000.
The lawsuits seek to determine the floodwalls failed due to the hurricane and seek compensation from the responsible government agencies, including the Army Corps of Engineers, the Orleans Levee District and insurance companies.
Should government hold the insurance companies liable to pay property owners whose homes and offices were flooded, "you are going to see a massive rush to exit the state," Albright said. "It would be catastrophic for the state’s commerce."
No exit has taken place so far.
Wooley said no insurance companies have sent notices that they plan to stop writing coverage in Louisiana, as happened after Hurricane Andrew in 1992.
"As soon as the wind died down in Andrew, companies were faxing their agents saying they weren’t going to write coverage in Louisiana," Wooley said.
After Hurricane Andrew, the state began allowing insurance companies to base their rates not just on competition, but on location in a hurricane-prone area, Wooley said.
“After Andrew, a lot of companies went under,” he said. “Overall, the industry is a lot stronger than after Andrew."
For insurance companies to stay in Louisiana, Wooley said it’s critical that state regulators and the state Legislature treat the companies fairly.
In addition, almost everyone realizes that Louisiana must adopt a much tougher building code, such as Florida adopted after Andrew, that makes structures better able to withstand wind damages.
"If we could pass a uniform building code instead of a hodge-podge of local government rules, that would make the state more attractive," Wooley said. "That’s what makes North Carolina more attractive. That’s what makes South Carolina more attractive. That is something that would be seen as a positive thing by the insurance industry."
Hurricane Ivan’s impact on the nearby Florida Gulf Coast a year ago shows the value of a stronger building code. New beachfront houses built to the stronger Florida building code standards withstood the storm, even when older houses next door were wiped off of their foundations.
"The evidence is compelling," Albright said. "There’s no doubt the building code made a big difference."
Gov. Kathleen Blanco has talked about including a stronger building code in her special session agenda, but that agenda is still under development.
"There’s a lot of opportunity here," Blanco said. "We have many layers of problems that we are working on simultaneously."
The building code should include requiring new houses to be built up above sea level, Wooley said.
Both consumers and the industry benefit from a stronger building code, Albright said. Fewer damages mean less losses and lower premiums, he said.
Rates will go up, and hard questions are going to be asked about Orleans, Albright said.
"Insurance rates always go up after catastrophic losses," he said. "It’s a matter of dollars in and dollars out. Insurance companies are going to make a profit."
But the increases would be lesser if there’s a tougher building code and other changes.
The Joint Legislative Insurance Committee will be meeting within a week or so to hear from Florida representatives about insurance code changes, said state Rep. Karen Carter, D-New Orleans, chairman of the House Insurance Committee.
Florida State Sen. Steve Galler, chairman of the Florida legislature’s insurance task force, will present the Florida plan, which includes limiting the number of deductibles insurance companies can charge when there are multiple hurricanes, as occurred in Louisiana.
"We are going to develop a package of legislation to provide immediate relief and future stability," Carter said. "Business decisions are being made and insurability is one of the major factors."
One of the factors will be what kind of levee system the federal government plans for New Orleans. Blanco has asked for an immediate restoration of levees to a Category 3 status and commencement of building a Category 5 levee system.
Once existing claims are paid, residents and business owners will then ponder whether they will rebuild.
"They will want to know if insurance companies will continue to write and whether it will be at affordable rates," Carter said.
Both Carter and U.S. Sen. Mary Landrieu propose a federal bailout of insurance companies.
Landrieu thinks insurance rates should be based on nationwide risks, not state-by-state. "The risks would be spread over larger populations," she said. Such a system would insure "rates will be responsible but affordable," Landrieu said.
"We bail out everyone else," Carter said. "Every year we are spending $300 billion in Iraq. To have Congress worry about spending money rebuilding Louisiana is not only disheartening, it is deplorable."
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