Nagin says New Orleans to decide reconstruction

In a wide-ranging discussion at the state capitol with city council members and state lawmakers representing New Orleans, Nagin said the city had spent its last available cash last week on city employee payroll and was seeking bank loans, federal assistance and other means of financing to continue paying its bills and staff.

"Technically today we’re out of cash," Nagin said. "The city is bankrupt … We have no money."

He said he intends to find enough money to pay all people on the city’s payroll system through the end of the year, and then reassess what the city can afford.

A burning issue at the meeting was a recent story in The Wall Street Journal in which a Nagin cabinet official who is a wealthy white businessman was quoted as saying that people who want to rebuild the city foresee a town with a new demographic of fewer poor people.

The story touched a hot button issue for the African-American state lawmakers, who expressed concern that Nagin might be coordinating a recovery program assuming that a large portion of poor blacks would be discouraged from returning to the city. The fear was heightened by the fact that Nagin had met with predominantly white business establishment leaders in Dallas Friday when he was there getting his family resettled and children enrolled in school.

But Nagin said the article "pissed me off" because "some people may think this is an opportunity for us to build the New Orleans of 1812. We’re not going to do that."

He said the business leaders called him in Dallas and he agreed to the meeting, where he "made it very clear to everyone in that room that we are going to move forward, with them or without them. And if they don’t like the direction we’re getting ready to head in, they can leave."

"The model that we’re looking for to rebuild this city, is to keep New Orleans unique culturally, unique musically, unique from a people perspective, but economically as strong as an Atlanta, where you have a strong middle and upper class of African Americans, of white folks, of Hispanics, of Vietnamese," Nagin said. "And if we’re not collectively working toward that goal, then there’s a problem. So we got them straight.

So don’t worry about this city being hijacked by a small group of people who are trying to take us backward."

State Rep. Karen Carter, D-New Orleans, and other state lawmakers told Nagin that he needed to communicate more effectively with the legislative delegation and that he had taken too much of the responsibility on himself to solve all the problems as they arose since Hurricane Katrina struck two weeks ago.

"You cannot do it alone," Carter said. "You may have done it that way in the past" before the city was in a state of crisis.

Although federal authorities are letting some residents and business owners visit the city to check on their homes or records, the city will not let people back in until the mayor has more information about the potentially toxic condition of the water and soil, Nagin said. He is expecting reports from the Center for Disease Control and the Environmental Protection Agency in the next couple of days.

Nagin said some city officials had erroneously reported that the city was arranging for business owners to visit their sites in the city. Possible contaminants or disease in the environment and the uncertain integrity of the levee system create too many hazards.

"I’m going to err on the side of protecting lives first," he said.

Nagin could not offer a timeline for when citizens might one day return, saying electricity and sewer systems must be in good working order.

FEMA already is sending more than $100 million to reimburse the city for recovery expenses, and the city is close to signing a number of contracts for the work, Nagin said. The city’s only final contract as of Monday was for a waste-management company to clear debris.

The bulk of federal moving is moving through the state, he said.

Nagin said a city plan, not contracts, were his ultimate focus.

"What I care about is the plan. I don’t want anybody outside of New Orleans planning nothing as it relates to how we’re going to rebuild this city without us signing off on it," Nagin said.

Nagin met Monday in New Orleans with President Bush and Gov. Kathleen Blanco.

"There’s an incredible intensity of focus from the president and his staff to get stuff done," said Nagin, who has been critical of the federal response to the storm crisis. "They want to have accomplishments."

Of Bush, he said, "Every time he’s told me he’s going to do something, personally, face-to-face, he’s done it."