Can Rebuilding Create
A Better New Orleans?

Pres Kabacoff has a plan to rebuild New Orleans -- one that he helped devise before the flood.

Now the New Orleans real-estate developer hopes that the study produced over the last year, dubbed Operation Rebirth, will become a road map to create the new New Orleans. The study, which seeks to reinvigorate rundown stretches of the city, envisions an "Afro-Caribbean Paris," with garden-lined boulevards, an African-American cultural district, a modern trolley system and 25,000 revitalized homes -- houses that were left to rot long before Katrina arrived.

Even as fetid water covers half the city and officials demand the evacuation of the residents who remain, civic leaders, real-estate developers and government officials are quietly discussing plans to remake the Crescent City into something better than it was before the devastation.

"There's now the possibility of getting substantial federal aid to do what would have been impossible before Katrina," says Mr. Kabacoff, whose firm, Historic Restoration Inc., is operating from a temporary office in Houma, La., about 50 miles southwest of New Orleans.

With as much as $200 billion in federal aid possible for the region, much of it aimed at New Orleans, once pie-in-the-sky redevelopment plans suddenly appear possible. A light-rail system, new schools, a mile-long riverfront park, museums and other cultural facilities are just some of the ideas that hometown boosters have long promoted as elixirs for the neighborhoods that remained cut off economically and geographically from the city's tourist and convention-business goldmine.

The challenges, of course, are immense. Even before the hurricane's devastation, New Orleans had one of the nation's highest concentrations of poor people and one of its worst crime rates. The population has declined to about 485,000 from 650,000 in 1965, and its median income of $38,428 is 13% below the national level.

"Rule No. 1 is don't repeat mistakes of the past," says Bruce Katz, a community-investment expert at the Brookings Institution. To avoid creating hyperconcentrations of poverty, he says, the city needs to create "economically integrated neighborhoods of choice," where people of mixed incomes will want to live. He points to Fairfax County, Va., and Madison, Wis., as examples of areas where that has worked.

One big unknown is how much of the city's diaspora will return, and how many will find new homes and jobs elsewhere. A high percentage of its low-income residents were renters who don't have property to return to. Reducing its concentration of poor could ease some of New Orleans's social problems. At the same time, the city will need a wide range of workers and income classes to fill jobs at hotels and restaurants, as well as offices and stores.

Some fear that a rebuilt New Orleans could be a sanitized version of its past, lacking its trademark gritty charm. "We don't want to diminish the culture or the tradition, but we are looking forward to implement all the wonderful ideas people have had," said Michael Olivier, Louisiana's secretary for economic development.

Probably the best news for rebuilding New Orleans is that its key tourist areas remain relatively unscathed. The French Quarter is dry, though a mess. Jackson Square is intact, and its famous statue of Andrew Jackson still rides high on his stallion. The historic Garden District, where stately homes sit along oak-lined boulevards, as well as the trendy Warehouse District also are largely unharmed.

Tourism is the city's fastest-growing industry, accounting for 14% of jobs, up from 11% in 1990, according to Property & Portfolio Research, a real-estate research firm. It is also the largest employer, except for the government.

The city's other key industries are its port, energy and education. New Orleans wasn't put where it is by accident; its port is one of the country's most important, handling commodities such as oil, grain and coffee. The port started to reopen yesterday, and for it to keep operating, housing and basic services will be necessary for the approximately 60,000 people in the metro area employed at the docks.

But the return of the energy industry, which was already shrinking in the city, and education, will depend on the success of the rebuilding effort.

That effort began yesterday. Mr. Olivier said he attended a three-hour meeting of the governor's cabinet where the discussion turned from handling the chaos to planning for the recovery. Mr. Olivier and the state's secretary of labor were named to lead the effort to retain businesses in the region and also try to attract new ones. Plans also were being set to house construction crews, who will first live in modular homes, Mr. Olivier said.

Developing actual plans for specific neighborhoods and buildings could take years. "Remember how long it took after 9/11," says John K. McIlwain, senior resident fellow at the Urban Land Institute, a real-estate research group, referring to the continuing process to plan and rebuild Ground Zero. "And that's just a six-block area to get sorted out."

Some people are raising the idea of looking to casinos to cure the city's social and economic problems. Gambling companies long ago sought to turn New Orleans into the Las Vegas of the South. High casino taxes and corruption have played a part in keeping casinos away, as have strict licensing requirements. (Harrah's Entertainment Inc. has the only land-based casino in New Orleans.) But all that might change with the prospect that steady work -- the type casinos offer -- may be the best way to lure back low-income residents.

Las Vegas Sands Inc., a Nevada-based casino company, could enter the New Orleans market if the conditions are right, says a company spokesman. Sands and other casino operators have experience constructing major projects that include hotels, shops, restaurants and entertainment, plus casinos. "It's clear we have the capability for large-scale projects," said the Sands spokesman, Ron Reese.

New Orleans, known for its small neighborhoods, is more likely to opt for more intimate proposals, such as the proposed New Orleans Upriver Greenway Corridor. A study paid for by the Army Corps of Engineers and the Trust for Public Land, finished just before Katrina struck, calls for a $15 million to $85 million revitalization of a mile-long stretch of the Mississippi waterfront. The plan envisions taking over dilapidated cargo wharves to create a ribbon of parks and recreation along what's now an inaccessible industrial waterfront.

"The riverfront is the cornerstone of the future of New Orleans," says Larry Schmidt, a New Orleans native and head of the local office of the Trust for Public Land. "It can be part of a renaissance of the riverfront of New Orleans."

Mr. Schmidt isn't unaware of the water's good and evil sides. "Water built New Orleans, and water is the key to the future of New Orleans." He adds: "Who knows, we may name the park Katrina."

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