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Kai Ryssdal:Five years and a day after Hurricane Katrina hit New Orleans, nobody is saying the city is back yet. In his speech down there yesterday, the president went so far as to say New Orleans is coming back. And the population is up to about 80 percent of what it was before the storm. The business of rebuilding saved the city from the worst of the recession. But the long-term New Orleans economy? That is still a challenge.
Marketplace's Eve Troeh reports.
Eve Troeh: If you stand in Greg Rigamer's lakefront office, you can see New Orleans getting its act together. You can hear it, too.
A construction crew is almost done driving pilings for a new flood wall.
Greg Rigamer: It takes 270 blows to push a pile down in the soil here.
Rigamer likes to count things. He runs an urban planning firm. And he has every figure you'd want to know about New Orleans -- like, the city is down about 80,000 jobs. Or, it has more than 50,000 vacant homes. Some things are working in the city. It has basic services -- the lights are on, schools are open...
Greg Rigamer: But things like playgrounds and libraries, even health care facilities and the like are really in short supply.
The government has tried to help. Congress approved billions of dollars in federal relief money for the city. Hundreds of millions have yet to be used.
But New Orleans needs long-term private investment to rebuild. The feds tried to push that, too. A tax-free bond program was supposed to attract investors. Wall Street didn't bite.
Buck Landry: It was hard for New Orleans to get an investor reputation.
Buck Landry is managing director of investment firm Morgan Keegan in New Orleans. He helped put together a big bond deal for a hotel... that fell through.
Landry: Couldn't get the bonds rated. Couldn't sell the bonds. Investors didn't want to come here because of the sensationalism that was created by the storm and the aftermath and, you know, drama.
Landry says investors looked at New Orleans and saw too much risk -- in broken infrastructure, high crime and the chance the city would flood again. The new levee system should be finished next year. But an investor wouldn't have to go far from the boardroom to hear that many New Orleans residents aren't sure it's enough.
Katherine Daigle's home in the Lakeview neighborhood flooded. I asked if she felt her new house there was safe.
Katherine Daigle: It was supposed to be, but we thought we were protected and we weren't. Of course, you have some reservations.
Melba Leggett: I don't have any faith in them fixing that levee.
Melba Leggett in the Lower Ninth Ward can see the new levee from her house.
Leggett: I don't understand them not making it higher and the depth deeper.
Businesses that want to be in the region don't have to choose New Orleans. Planning expert Greg Rigamer says the smaller cities around it aren't as risky or as expensive.
Rigamer: Flood insurance, business interruption insurance cost less. And the likelihood of being shut down for a hurricane is minimized. These are challenges that it will be difficult to address.
The city's new mayor is Mitch Landrieu. He's confident New Orleans can overcome. As he rushed to a budget meeting, he said the city has a lot to offer business, especially creative startups.
Mitch Landrieu: They look at their ability to make money, but they also look at livability. They also look at culture, they look at art, they look at music, they look at community spirit, community soul. They also look at buying in when it's cheap, so that it can get better, right?
New Orleans may have to decide between big business and charm. At that budget meeting, one item that came up was a plan for a new hospital. It would bring hundreds of jobs, but it would flatten blocks of historic homes. The room was torn: Progress, or history? It was the kind of debate you used to hear in New Orleans before Katrina hit. And that at least shows the city is getting back to its old self, even if it hasn't yet started to move forward.
I'm Eve Troeh for Marketplace.