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New Orleans Environmental `Nightmare' Slows Recovery

Sept. 16 (Bloomberg) -- The massive environmental cleanup needed in flood-ravaged New Orleans, a city awash in the toxic residue of ruined industrial facilities, is slowing the progress and increasing the cost of the Gulf Coast's recovery.

The flooded areas include more than 60 chemical plants, oil refineries and petroleum storage facilities, according to U.S. Environmental Protection Agency records. The full extent of the damage won't come into complete focus until the water that swamped 80 percent of the city is pumped out, a process the Army Corps of Engineers says may take until mid-October.

``It's a nightmare,'' said Jay Grimes, director of the Gulf Coast Research Laboratory at the University of Southern Mississippi in Hattiesburg. ``There's so much unknown material in that water. You have to assume there's a lot of toxic material. Some of it could stick around for months or years.''

Michael Chertoff, the U.S. secretary of Homeland Security, said Sept. 11 that Hurricane Katrina's blow to New Orleans last month created ``probably the greatest environmental mess we've ever seen in this country.''

The consequences of a major hurricane devastating a large industrial city such as New Orleans are reflected in the fact that the EPA has already detected unsafe levels of lead, bacteria and arsenic in the flood waters. Some rescue workers, including volunteer Ron Hagerman, 46, of Marco Island, Florida, report headaches, blurry vision and rashes from working in the polluted water.

Slowing Rebuilding

The EPA now plans to start testing the soil to check for leaked toxic materials from Superfund sites -- abandoned properties contaminated by hazardous waste -- or other sources.

``We have a lot of concern about what in fact may be there, from radioactive isotopes that may have been used in hospitals or in universities, to oil and gas facilities to household chemicals,'' EPA Administrator Stephen Johnson said in an interview this week.

In addition to slowing rebuilding and recovery efforts, the contamination could further hinder energy production as well as the seafood, shipping and tourism industries in outlying areas.

``It will take a tremendous commitment to make the city economically viable again,'' said Lynn Goldman, who oversaw pesticide and toxic-chemicals programs at the EPA under President Bill Clinton. ``It's going to hinge on a lot of factors, including the ability to pull the environment back together.''

The cleanup costs may far exceed the $62 billion in direct aid approved by Congress so far, said Philip Clapp, head of the Washington-based National Environmental Trust.

Superfund Sites

Johnson said there's no way to know yet how much the cleanup will cost or how long it will take. The EPA has received $100 million from the Federal Emergency Management Agency and so far has enough money for the cleanup, he said. Johnson declined to comment on whether his agency will ask for additional funds from the president, saying it's too early to tell.

President George W. Bush, speaking to the country from New Orleans last night, made a sweeping promise to rebuild the Gulf Coast, a project he said would be ``one of the largest reconstruction efforts the world has ever seen.'' He didn't give a price tag.

At least three Superfund sites were flooded in New Orleans, the EPA said. One of them -- the Agricultural Street Landfill, which lies downtown near a residential area and a school -- remained submerged as of yesterday, the agency said.

The flooding may also have shaken asbestos loose from old buildings. ``They will have to take down some of those structures,'' Goldman said.

`Widespread Catastrophe'

New Orleans might end up having to turn parts of the city into ``brownfields,'' said Dale Lehman, URS Corp.'s national coordinator for disaster contracts with the Federal Emergency Management Agency. While a site designated as a brownfield is eligible for federal cleanup grants, the label can also scare away potential developers.

Lehman was in New Orleans last week to assess damage for URS, a San Francisco-based engineering company that has been hired to help the government rebuild the city.

``This is the most widespread catastrophe I've seen,'' he said. ``There are petrochemical manufacturers, refineries, damaged gas stations and major port facilities, all submerged.''

It may be a long time before New Orleans residents can return to homes in flooded areas, Mike McDaniel, head of the Louisiana Department of Environmental Quality, told reporters in Baton Rouge this week. While testing of water and air in the area has raised few causes for concern, the process of sampling and clearing areas will take time, he said.

State View

``There's some serious decision-making that has to occur,'' he said. ``There are a lot of questions about safety and about health hazards, and it will be a while until people will be allowed to go back.'' Some flooded homes will probably have to be destroyed to reduce health and safety hazards, he said.

The state environmental department is working with the EPA and New Orleans Mayor Ray Nagin to assess risks from industrial sites and railway cars that may contain toxic chemicals and radiation, McDaniel said.

McDaniel said preliminary surveillance to date has shown no unexpected contamination, and some state officials say the EPA may be painting too grim a picture. Tests thus far show that conditions, while unsanitary, aren't toxic, said Chris Piehler, a senior scientist at the state environmental department.

New Orleans is still about 40 percent flooded. The stew of chemicals, toxic waste and raw sewage is being pumped into Lake Pontchartrain, where it could linger and potentially end up in the Gulf of Mexico.

Gulf Waters

Grimes said a hint of what might be in the water came last week when he found two old electrical transformers contaminated with PCBs, which the storm had swept out of his own lab's shed used to store toxic chemicals.

Use of PCBs, which are harmful to people and wildlife, were phased out by law in 1976. PCB exposure can cause reproductive failure in animals and infertility, cancer, and neurological problems in humans, according to FEMA's Web site.

Grimes said the transformers weren't leaking. ``We took care of it, but it's a small example of what else might be out there,'' he said. ``It's staggering to even think about.''

The pumping of New Orleans' untreated floodwater into Lake Pontchartrain could kill large amounts of fish and other wildlife as well as hurt an already struggling seafood industry.

``The fish don't know to stay away from New Orleans,'' said Robert Goldstein, senior lawyer for the environmental advocacy group Riverkeeper in New York.

The National Oceanic and Atmospheric Administration said it plans to test fish and shrimp off the coasts of Louisiana, Mississippi and Alabama for contamination that might affect human health.

Gulf Waters

Along with testing the floodwater, the EPA is working with state officials to get more than 1,000 drinking water systems and 123 wastewater treatment facilities up and running in Louisiana and Mississippi, Johnson said.

Some former federal officials said they were concerned that the EPA's efforts might be hindered because of lack of funding in recent years. The EPA's budget was trimmed to $7.7 billion for the fiscal year that starts next month, down from $8 billion in fiscal 2005 and $8.4 billion in fiscal 2004, according to budget documents from the White House Office of Management and Budget.

``The federal EPA is going to be looked to for leadership here,'' Sylvia Lowrance, former acting assistant administrator for enforcement at EPA, told reporters last week. ``But they can't lead unless they are given the resources to do so.''

To contact the reporter on this story:
Kim Chipman in Washington kchipman@bloomberg.net.