La. redevelopment bill put off until next year

Though his plan for a federally financed Louisiana redevelopment board failed to hitch a ride to full House passage yesterday, Rep. Richard Baker (R-La.) and a broad group of supporters are looking ahead to next year while keeping grassroots pressure high.

Baker’s proposal, the product of extensive negotiations with industry and urban planners, would create a new agency-business hybrid called the Louisiana Recovery Corporation (LRC) to oversee rebuilding on the still-struggling Gulf Coast. Homeowners with damaged property could sell their homes to the LRC at a pre-Katrina price, with the LRC assuming mortgage liability and working with developers and local governments to convert the land into usable space.

The banking industry, facing the difficult choice between foreclosing on mortgages in heavily damaged Gulf neighborhoods and giving further payment extensions, gave their blessing to Baker’s LRC bill. But his efforts to attach the LRC bill to yesterday’s defense appropriations bill, even after bipartisan approval in the House Financial Services Committee, wound up unsuccessful.

“I want all my Louisiana friends to know that down to the very last minute I did everything I could to make it happen, but I did not succeed,” Baker said yesterday in an e-mailed statement.

Senate negotiators balked at adding the LRC to the defense-spending package, according to one GOP aide, citing a lack of sufficient time to evaluate the details of the bill. Sen. Mary LandrieuMary Loretta LandrieuLandrieu dynasty faces a pause in Louisiana Senate GOP rejects Trump’s call to go big on gun legislation Project Veritas at risk of losing fundraising license in New York, AG warns MORE (D-La.) plans to introduce the Senate version of the LRC bill today, suggesting that timing may have been everything.

Baker has targeted Gulf Coast communities in an attempt to build a public outcry in favor of his bill, appearing on talk radio shows and encouraging constituent call-ins. In addition to banking and real estate lobbying, the bill has netted an endorsement from the Urban Land Institute, the planning group hired by New Orleans Mayor Ray Nagin (D) to coordinate his city’s reconstruction.

“The corporation is needed and necessary,” said former Louisiana Sen. John Breaux (D), who has lobbied extensively for more federal hurricane relief. “It really is a chicken-and-the-egg thing. People are not going to say, ‘We’ll just come back and sit there, not have a house or business, and someone will give us help in the future.’ It’s got to be something Congress does.”

Breaux acknowledged recent congressional anxiety about eminent domain, a tactic used by some local governments to force homeowners into selling their property, and noted that the LRC is a strictly voluntary program.

The LRC’s seven directors would be White House appointees, with three coming from a list of nominations provided by Louisiana Gov. Kathleen Blanco (D). The bill recommends that corporation leaders be experts in urban planning and economic redevelopment, though no requirement exists that all directors be Gulf Coast-based.

“There should be a combination of a strong role and input from Louisiana, but at the same time, with the funding of this coming through the Treasury, there is a sense from the federal taxpayer that there should be an opportunity for the best and brightest from all over the country,” said Baker spokesman Michael DiResto.

Breaux added that it was unlikely a Washington lobbyist, even one as Louisiana-proficient as himself, would be named to the LRC.

“You need someone who’s going to be on the ground there on a full-time basis,” he said. “It’s less a political job and more of a real-estate type of job.”

Next month will bring another round of mortgage deadlines for Gulf homeowners still waiting to receive word on whether insurance will cover their hurricane damage, making Baker’s home-state boosters work even harder on building momentum.

“The sooner Congress gives its OK the sooner storm-tossed homeowners can start to rebuild their lives — and this region’s economy,” wrote the New Orleans Times-Picayune in an editorial urging swift passage of the LRC bill, which is co-sponsored by the state’s entire House delegation.

Steve Verdier, vice president of congressional relations for the Independent Community Bankers of America (ICBA), traveled to the Gulf earlier this fall with colleagues from the Financial Services Roundtable. The lobbyists heard an earful, Verdier said, from locals eager to see Baker’s bill come to a vote.

“I got up and said, ‘It’s hard for us to do easy things in Congress. Just because something is vitally necessary doesn’t mean it’s going to pass,’” Verdier said.

While today’s unveiling in the Senate should help speed the bill toward a floor vote soon after the House returns on Jan. 31, Verdier called for more detailed rebuilding discussions with Nagin to help K Street and Congress collaborate successfully on the LRC.

“If Mayor Nagin, as he told us, comes up with a plan by the end of year that looks kind of credible, then it will be a little more obvious what it is the Baker bill will be funding,” Verdier said. “Right now it’s not clear, exactly, what the money would be used for.”

Baker has outlined several steps he plans to take to help the bill move quickly to the floors of both chambers. In addition to asking federal regulators for continued commitment to relaxing foreclosure deadlines for Gulf Coast mortgages, Baker said he plans to meet with Senate Banking Chairman Richard Shelby (R-Ala.) in early January, before Congress formally reconvenes, to try to secure his support.