Rebuilding New Orleans Report

New Orleans Mayor Ray Nagin’s Rebuilding New Orleans Commission committee recently released a report on urban planning.

The plan, which does not have the force of law, envisions a revitalized, ultra-planned, sustainable, light rail connected, new New Orleans in a reduced geographic footprint. By far the most controversial suggestion is that some neighborhoods in the city will not be rebuilt because they are too dangerously flood prone and just too expensive for the city to maintain with satisfactory public services and utilities.  To determine which neighborhoods get rebuilt and which are abandoned or bought out to create parks, green spaces and flood plains, the Commission proposes a lightning fast, four month planning process through which residents of the neighborhoods themselves will demonstrate which neighborhoods are sustainable by showing that at least half of the residents plan to return and other indicators of urban sustainability are in place. The plan also recommends that the city impose a four month moratorium on any new building permits so that residents do not invest money and resources rebuilding homes in areas that will ultimately not be rejuvenated. Finally, the plan proposes creation of a Crescent City Recovery Corporation, a public corporation that would have the power to buy out residents who do not want to rebuild (by paying 100% of their pre-Katrina equity) and the power of eminent domain as a last resort to acquire property of those who do not want to sell.

Not surprisingly, there is heated opposition to these recommendations in some quarters, particularly to the proposed permit moratorium and the potential eminent domain threat  Some residents claim they can rebuild on their own just fine without the assistance of the city and the visionary planners it has assembled.  They want the city to simply get out of the way.  Other residents, especially those from the lower Ninth Ward and New Orleans East, fear that the city or an aligned pubic redevelopment corporation will exercise the power of eminent domain to take the property they have struggled to create and maintain over generations against their will. Yesterday at the public meeting unveiling the plan some of these residents were threatening Waco-like resistance to any exercise of eminent domain.

My gut level prediction at the moment is that the Mayor will not have the political fortitude to impose the permitting moratorium but will let the planning process go forward in order to convince the state and federal authorities to release funds for rebuilding infrastructure and housing. This makes some sense because the permits granted and acted upon can themselves serve as an important piece of data in making the necessary planning decisions.  Further, the threat implicit in the plan of shutting down some neighborhoods is probably going to stimulate a lot of quick community building in neighborhoods that want to survive.  So, ultimately, the planning controversy could help invigorate the city in the long run.

But two big question marks remain.  First, FEMA has yet to issue flood plain maps that will tell people where they can rebuild (and how high they have to rebuild) to obtain federally supported flood insurance.  The maps are supposed to be released next month.  And second, Congress and the President need to pass and sign the Baker Bill (HR 4100) to create some public corporation with sufficient funding that can settle mortgages, buy out some portion of homeowner’s equity, and perform some land assembly tasks to facilitate large scale redevelopment. The President was just in New Orleans, and we will see over the next few months what happens on all of these fronts.

In some sense, we are also seeing an echo of the Kelo controversy, with utilitarian oriented, welfare maximizing urban planners battling moral rights oriented property owners. It will be interesting to see who wins, or, what would be better, if everyone can walk away claiming victory in the end.

John Lovett

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