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New Orleans’ slow rebuilding: ICCR delegation visits devastated region

May 22, 2006 

The following piece was written by Cathy Rowan, a former Maryknoll lay missioner who works as the corporate responsibility coordinator for the Maryknoll Sisters. The article is long, but is quite informative about the current reality in New Orleans and southern Louisiana. 

From May 1-3, I had the privilege of being part of a delegation of 14 members of the Interfaith Center on Corporate Responsibility (ICCR) to New Orleans and western rural Louisiana. The goals of our trip were:  

·       To explore community investing opportunities for Hurricanes Katrina and Rita-impacted areas and to look for ways to integrate community investing with long-term rebuilding plans.

·       To bear witness to and support the work of the faith community and show solidarity with communities impacted by the disaster.

·       To bring ICCR’s ministry of corporate social responsibility through shareholder advocacy to bear on issues facing the region, especially on increasing access to capital through work with banks and insurance companies. 

We spent time in various neighborhoods in New Orleans and also visited small rural communities west of the city in the parish (county) of Vermillion. What follows are accounts of what we saw and heard and felt. 

New Orleans: A security guard I talked with near our hotel in New Orleans’ warehouse district on our first day summed up much of what I heard throughout our visit: “There is so much uncertainty. People need some guidance, someone to hold their hand and help them figure out what their options are, as they decide whether or not to come back and rebuild. We are just hoping we can make it through the summer.” 

While some of my colleagues who have been to New Orleans several times since Katrina noted a number of improvements since last September, it was a shock to see for the first time the scale of the devastation: blocks and blocks of dusty, moldy, looted abandoned cars under the I-10 overpass; entire neighborhoods of every income destroyed; small businesses and entire shopping centers left abandoned. What was most haunting for me was driving past the Superdome (which we had to do many times). I felt as if the spirits of all those who had waited desperately there, and those who died there, were still present. I could not look at that stadium without seeing those people. 

We visited the neighborhoods of the Lower 9th Ward, Treme, New Orleans East, and of several in St. Bernard’s Parish. We saw the waters of the Gulf of Mexico where they never used to be and the site of the Murphy Oil spill in Chalmette. There were still piles of the remains of the insides of people’s homes on the sides of the road in the Lower 9th, New Orleans East and St. Bernard’s (FEMA is no longer doing trash pickup).  

Our guides, Mary Baudouin from the Social Ministry Office of the Jesuits' New Orleans Province and Charlotte Bourgeois from Louisiana Housing Advocacy, showed us some of the rebuilding that Catholic Charities and neighborhood community development corporations are doing. There are plans to construct 60 units of senior housing in an old church school in the Bywater neighborhood. The Ujamma Community Development Corporation of St. Peter Claver Church (which took in four feet of water and just re-opened for Easter) is constructing four “shotgun” style houses on a plot of land in the Treme neighborhood, and hopes to do more. Catholic Charities has formed a new non-profit, Providence CDC, to work with other community development corporations to build 6,500 apartments or homes, and is raising money to do so.  

One of the big concerns is what my new friend the security guard talked about: the uncertainty. As Jim Kelly, the head of Catholic Charities told us, “Healing will not take place until people know they have a place to live.” There is not a coherent citywide plan for what to do. Charlotte said, “People want to be able to work, live and have their children go to school in the same city.” We were told that there were 180,000 jobs in New Orleans, but not enough housing for those workers. But how can you rebuild your home if you can’t get insurance? And even if you can afford to buy insurance, and decide to rebuild, how do you know if your neighbors will rebuild, too? Will there be health care, schools and businesses near by? How will businesses know if there will be customers? And – will the levees hold in the next severe hurricane (which, because of our impact on the planet’s climate, is surely coming)? There is so much mental angst about the future. If the first step to healing is having a place to live, how do you get on the path? 

One member of our group said that what is really needed is a “Marshall Plan” for the hurricane-affected areas. But the local people told us that Congress will not respond. We heard from various people that they feel abandoned by the rest of the country. “This is all about discrimination,” said Jim Kelly. Only 17 percent of the members of the House of Representatives have visited New Orleans, and only 30 percent of the senators. How many more Congresspeople have gone to Iraq? 

New Iberia: We saw some of the destruction that Hurricane Rita’s 20-foot storm surge caused in western rural Louisiana. Lorna Bourg and Sr. Helen Vinton, of the Southern Mutual Help Association (SMHA) in New Iberia (80 miles west of New Orleans), showed us the broken shrimp boats and damaged homes of Delcambre, a house that floated 600 yards off its foundation before slamming into a tree near Erath, and a small neighborhood in Abbeville that is putting its life back together thanks to volunteers from groups like Mennonite Disaster Relief.  

We met Pop and his family. Volunteers are rebuilding the homes of Pop’s two sons, while his house sits under a tree about 20 yards behind its cement front steps. Meanwhile, Pop and his wife are living in a FEMA trailer. Someone from FEMA stops by regularly to “check in on the trailer”; during the last visit, the agent told Pop that FEMA would be returning in about 60 days to reclaim the trailer. We were stunned at this attempt at “FEMA accountability.” “Can’t FEMA at least adopt a policy of getting out of the way of people repairing their lives and ‘do no harm’?” one of our team members asked. We urged our new friends of SMHA to alert the media about this possibility, so that any attempts to evict residents from their trailers would be met by TV cameras – and not shotguns. 

The Southern Mutual Help Association has been on their mission of “building healthy, prosperous rural communities” since 1969. They rely on donations, grants and investments from individuals, socially responsible investors and the private sector. Since Katrina and Rita, they have listened to the stories of people who have lost homes or livelihoods and developed what Lorna called “very customized relief.” In the fishing village of Jean Lafitte, residents said their top priority was re-establishing the village’s three seafood restaurants in order to bring back some tourism and restore jobs. One of the fishers needed $10,000 to repair his boat. SMHA was able to put together a $5,000 grant and a $5,000 loan (to be re-paid biannually at his selection). 

SMHA has coordinated the work of volunteers who have helped local residents repair 300 homes so far in Vermillion Parish. “We use the social capital that communities have and reinforce the spirit of generosity that is in the people,” Lorna told us. The biggest challenges are the increasing costs of land and building materials, and the lack of insurance policies. “What we need,” said Lorna, “is a National Disaster Recovery Bond – like the war bond of the 1940s – to assist communities like ours.” 

Corporate responsibility issues: State Farm and Allstate were at the top of everyone’s list of bad actors. They are not paying out or are paying very little to their policyholders. A sign hanging from one severely damaged two-story home in New Orleans read: “Allstate paid $10,113.34 on this house for storm damage.” The companies are also asking people to drop their insurance. We heard one example from a State Farm policyholder who said an agent called to say, “Since you’ve used up all your insurance for this year already, why don’t you just drop this policy, since it is of no use to you.” Travelers and Hanover have given the predominantly African-American neighborhood of New Orleans East the worst time. Insurance companies give the money to banks like Washington Mutual or Countrywide, who hold it for months before passing it on to homeowners. 

Mortgage service agencies such as Freddie Mac and Fannie Mae “have been horrible,” according to one banker. He called on banks and insurance companies to create a pool of money to place mortgages, and let the local community banks service the mortgages for them. This is an idea our delegation wants to learn more about. 

JP Morgan Chase, which has many branches in the area, gave part of a $425,000 grant to the Ujamma CDC. Compare that to the $10 million which New Iberia Bank has invested in the Southern Mutual Help Association. Clearly there is more that a bank like Chase can do.

A representative of the business community, who is trying to attract IT businesses, sat down with Bell South officials, and urged them to combine their philanthropic efforts with help to put in a cost-effective, state-of-the-art IT capability throughout the New Orleans area. Bell South said no. He continues to pitch his plan to the high-tech companies. Entergy has declared bankruptcy in New Orleans and wants the federal government to pay for its losses with Community Development Block Grant money. We heard the city might take over the energy company here. 

Members of faith-based community organizations that are part of the PICO National Network told us about the large contractors (Halliburton and Shaw are among the usual suspects) that get the FEMA contracts that barely trickle down to local sub-contractors. PICO says that brownfields development will be a big issue in the future, and there is a need to ensure that women and minority contractors get a portion of this development work.  

All this information gave us many issues and angles to explore for shareholder advocacy work this year. 

Signs of hope: Several of us stopped in to visit the Hope Community Development Credit Union in the Central City neighborhood of New Orleans. Some of our organizations have Certificates of Deposit in Hope, and we wondered how much lending, if any, the credit union was doing after Katrina. The answer: more lending than ever. They have opened up twice the number of accounts post-Katrina than they had in the first nine months of 2005. Most of their new members are people who could no longer receive their Social Security checks by mail, and opened credit union accounts in order to do direct deposit. Branch Manager Lynette Colin told us that Hope was the only financial institution in the area working with the microenterprise community – “people who work under the radar.” Hope provides technical assistance, helps entrepreneurs expand their businesses, and “makes them legal.” They have lent money for small contractors to buy pick-up or dump trucks for the cleanup and at no interest for six months for people waiting for FEMA or insurance funds to buy clothes or find an apartment (and, if needed, will refinance at four percent for two years). Hope is very connected to the neighborhood’s churches. Trinity Episcopal Church helped set up their microenterprise lending program and Hope has done some housing financing with the First Evangelist Church.  

In the ghost town that is now New Orleans East, next to an empty shopping center, is the headquarters of Liberty Bank, whose mission is to serve African American communities. The building’s electricity has been on since late March, a handful of bank employees are back to work, and bank president Alden McDonald is determined to show that Liberty Bank is still an anchor in this community where 100,000 people used to live. Even though the bank lost a huge portion of its customer base, it is still lending - even if its customers buy homes outside the community. In Alden’s own sub-division of 120 homes, only five families have come back so far. Liberty Bank began a KIDS program (Katrina Investment Deposits) to leverage other funds to help people come back home. But the uncertainty remains. “The rules of the game haven’t been completely written” in terms of federal and state recovery money, Alden said. “What size will this city be: 250,000 in two or three years? There are 200,000 people ‘missing.’” He is working with neighborhood groups – four years ago he convened over 30 neighborhood associations for planning – who are contacting residents to see if they are coming back. But, will those people get insurance? Alden encouraged us, “Don’t let the insurance companies off the hook. We need to work with them to put a different model together.”  

The flowers that Sr. Sylvia Thibodaux planted this spring in front of the Sisters of the Holy Family Motherhouse on Chef Menteur Highway in New Orleans East are in bloom, and the eight feet of water in the motherhouse’s first floor has long since subsided. But all the local ministries of this 131-member African-American congregation, founded in New Orleans in 1842, are gone. The nursing home and assisted living centers across the highway are empty; the high school and grades schools are closed. We sat sadly in a circle as Sr. Sylvia told us their Katrina story. The sisters want to bring home the 71 sisters who were evacuated from the nursing home before the hurricane; they want to re-open the nursing home and the high school. The New Orleans Archdiocese gave them a building that could be used for a high school, but the Sisters need help with grant writing and planning for both the school and the nursing home. Perhaps they could renovate the assisted-living buildings into a type of retirement community for the elderly poor. They are waiting to hear what financial help they will receive from FEMA. Their fragile state is not unlike Sr. Sylvia’s flowers.  

What can we do? Our delegation is encouraging fellow ICCR members and every concerned citizen to write to their Congressional representatives and urge them to visit the hurricane-affected areas. We will develop a resource list of community development financial institutions and other community development organizations that are seeking investments. We will also call companies’ attention to the need for financial resources in the hurricane-affected areas, and to avoid such practices as redlining, predatory lending and other types of discrimination in rebuilding efforts.  

We are mindful that August 29 will be the first anniversary of Hurricane Katrina, and are exploring what the faith community can do by way of a national day of reflection and solidarity with the people of the Gulf Coast region. 

Read this article by Bill Quigley, New Orleans attorney and human rights activist, on the aftermath of Katrina, eight months later.

ICCR slide show on New Orleans delegation

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