Skip to: Content
Skip to: Site Navigation
Skip to: Search

Private dollars leading recovery of New Orleans

With government money for New Orleans trickling through the pipeline, private foundations, wealthy individuals, and philanthropies are playing a larger role than expected.

By Staff writer of The Christian Science Monitor / June 27, 2007

New Orleans

Billions of federal dollars have been allotted or spent in New Orleans since hurricane Katrina, so it may come as a surprise that the first public works project in the city's long-term recovery – the Rosa Keller Library in the middle-class Broadmoor neighborhood – was not paid for by American taxpayers but by the Carnegie Foundation in New York.

Skip to next paragraph

Government money is still trickling through the pipeline: On Monday, Louisiana recovery officials approved $117 million for the first post-Katrina community development grants. But with the long wait for cash, private foundations, wealthy individuals, and philanthropies have stepped in, playing a bigger role in the city's rebuilding than ever expected.

"The monies for rebuilding are coming first from private sources ... and that is definitely what is leading the recovery effort," says Doug Ahlers, a fellow at the Kennedy School of Government at Harvard. "Government funding is slow to arrive and is ... not playing a leadership role."

For many New Orleanians, wooing and leveraging private investments into cornerstone public works is empowering – and an example of how nearly 50 other struggling city neighborhoods can revitalize themselves. But concerns are emerging that the new model may leave behind unorganized poor neighborhoods, where 30 percent of the city's residents now live.

Charities, foundations, and private individuals have promised at least $50 million toward renovating and building schools, libraries, and senior centers in New Orleans since the hurricane, much of it in middle-class communities such as Uptown and St. Roch.

In contrast, the US has spent or allotted some $4.6 billion on activities ranging from helicopter rescues, levee repairs, housing assistance, and Superdome restoration.

But as the last scrap of Katrina debris is expected to be cleared from the city this month, the task of restoring the city's battered residential neighborhoods to normalcy still remains. With fewer than half the schools and hospitals up and running, the job is so daunting that completing it could take 20 years and $200 billion, says Ed Blakely, New Orleans' recovery czar.

As of last week, New Orleans had received "zero" federal dollars for long-term community recovery, Mr. Blakely says. But new hope arrived this week when the Louisiana Recovery Authority released the millions in funding for the first long-term rebuilding aid. The money is slated for city public works projects from Holy Cross to the Seventh Ward.

It is one piece of the city's "unified plan" for reconstruction totaling $1.1 billion. The overall plan promotes natural patterns of resettlement by spending in 17 "target zones."

Building public works in areas of heavy resettlement is not only practical but also will encourage more private investment, says Professor Ahlers, who founded the New Orleans Neighborhood Empowerment Initiative.

Onerous government red tape and demands for careful auditing of public funds have contributed to the glacial pace of federal reconstruction dollars into famously corrupt southern Louisiana, experts say, thus partly driving the city's early reliance on charity for rebuilding.

But others say it's common for government's capabilities to falter in a situation where damage is beyond comprehension and private money fills in the gaps, says Erwann Michel-Kerjan, managing director of the Risk Management and Decision Processes Center at the University of Pennsylvania's Wharton School of Business.

"There's been ... an awful lot of waiting around and an awful lot of promises that help was just over the hill," says Ahlers. "Now, a lot of neighborhood leaders have begun to understand that the cavalry [the government] is not coming."

New Orleans' recovery: by the numbers Public progress

Of the promised $343 million in federal emergency funds sent to New Orleans after hurricane Katrina, $176 million have funded various cleanup activities:

92,546 trash carts have been delivered

17.72 million cubic yards of debris have been removed from the city, amounting to 99 percent of the total

34,010 potholes have been patched

7,520 street lights have been replaced

5,995 street signs have been replaced

4,994 storm drains have been cleared

Public vs. private money

$117 million in US funds have been allotted for the long-term community recovery program to rebuild public works such as libraries, sewers, and schools

$0 has been received by the city so far

Expected number of days until federal cash arrives in the city: 40

About $20 million in private funds has been donated for public works construction

Source: New Orleans mayor's office