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La. says reconstruction aid not enough

White House rejects $30 billion request

WASHINGTON -- Multibillion-dollar grants that the Bush administration distributed yesterday to hurricane-ravaged states left Louisiana far short of the federal aid it wants and divided Gulf Coast lawmakers who have been working together to win more assistance.

The details of how the previously announced $11.5 billion would be distributed to five states followed word that the administration was rejecting a $30 billion redevelopment plan for Louisiana that state officials considered the cornerstone of their hopes for rebuilding.

''My dad used to tell me, 'Cheer up, things could be worse,' " said Representative Richard Baker, Republican of Louisiana, the architect of the $30 billion plan to jump-start his state. ''So I cheered up and things got worse."

By rejecting his plan, Baker said the White House ''is basically saying to Louisiana, 'If you want to rebuild, you have to find resources of your own.' "

Senator Mary Landrieu, Democrat of Louisiana, said officials were told Baker's plan was ''too expensive."

The White House rejection ''demonstrates a continued lack of understanding for the magnitude of the devastation and the immense rebuilding task our state faces," Landrieu said.

Asked about Louisiana's concerns that the grants would not help tens of thousands of people, mostly in low-income and working-class neighborhoods around New Orleans, federal Gulf Coast redevelopment officer Donald Powell said states can use the money to satisfy their most urgent hurricane relief priorities.

Once the grants are depleted, Powell said, ''We are very open to going back and asking for more money."

The bulk of the $11.5 billion -- $6.2 billion -- would go to Louisiana. That falls short of what Louisiana officials said was necessary to help an estimated 200,000 homeowners return and rebuild their communities.

But Mississippi officials hailed the grants that would bring $5 billion to their state and help up to an estimated 50,000 households that were walloped by flooding caused by Hurricane Katrina.

''It's huge," said Representative Gene Taylor, Democrat of Mississippi, who has worked closely with Louisiana lawmakers over the past four months to ensure that Congress continues sending assistance to the region.

Under the grant program, Florida is eligible for $83 million, Alabama for $75 million, and Texas for $74 million.

Gulf State officials have been grappling with sustaining White House and congressional interest in helping the devastated region at a time of huge federal deficits, costly wars abroad, and other federal expenses.

Congress has so far appropriated $67 billion to help the region get back on its feet. The White House has estimated the federal government has provided at least an additional $18 billion in flood insurance and other assistance.

Baker had proposed creating a federally supported Louisiana Recovery Corporation to buy large tracts of storm-damaged homes in Louisiana by borrowing up to $30 billion in US Treasury bonds. The corporation would repair the homes and resell them, either to developers or to the original homeowners.

But the White House said no to the program. Instead, the administration for now will focus on uninsured homeowners who lived outside designated flood plains, many of whom now face mortgage foreclosures that would almost certainly prevent them from rebuilding.

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