Two-thirds of Katrina donations exhausted; charities faced tough decisions

WASHINGTON —

Six months after Hurricane Katrina laid waste to the Gulf Coast, charities have disbursed more than $2 billion of the record sums they raised for the storm's victims, leaving less than $1 billion for the monumental task of helping hundreds of thousands of storm victims rebuild their lives, according to a survey by The Washington Post.

Two-thirds of the $3.27 billion raised by private nonprofit organizations and tracked by The Post went to help evacuees and other Katrina victims with immediate needs — cash, food and temporary shelter, medical care, tarps for damaged homes and school supplies for displaced children.

What's left, say charities and federal officials, will need to be stretched over years to rebuild lives and reconstruct the social fabric of the Gulf Coast — from job training to mental-health counseling to rebuilding homes to re-establishing arts organizations.

The Post survey, the first detailed examination of the largest outpouring of charity in the nation's history, also found the following:

The Red Cross , which was criticized for slow distribution of donations after the Sept.11, 2001, terrorist attacks, has given out 84 percent of its Katrina and Rita donations.

Fifty cents of each donated dollar went out in cash to victims.

Six percent of contributions came in the form of supplies — building materials, food, water, clothing, heavy equipment — contributed mostly by corporations.

Fifty-six percent of remaining donations are controlled by faith-based organizations. They include such well-known institutions as Catholic Charities USA and the Salvation Army but also lower-profile groups like the United Methodist Committee on Relief and United Jewish Communities.

What remains to be done goes well beyond even the staggering costs of rebuilding infrastructure — projects estimated to require nearly $200 billion in government aid.

"There are many, many needs that the federal government cannot cover," said Don Powell, a former Federal Deposit Insurance Corp. chairman who was named coordinator of the Gulf's long-term recovery by President Bush in November. Many are "the crucial part of life that we all depend on," he said. "It's not public works. It's not water, sewage or utilities. It's the soul of our life."

No one has put a price tag on restoring the "soul" of a region after such devastation, but the current charitable resources of about $960 million, as calculated by The Post, will not be sufficient, Powell said.

Even though many Gulf Coast residents are eligible for federal assistance for some housing costs, plenty of other residents will not qualify, say charities, who predict they'll have to pick up the slack. Also, the law that governs federal spending after a disaster strictly limits how much can go to private entities — places of worship and arts groups, mental-health services, youth programs and child-care centers. The desolate fiscal situations in Mississippi and Louisiana leave those states in no position to cover what the feds cannot.

For weeks after the storm, Americans and their employers poured hundreds of millions of dollars into charities, churches, synagogues and other religious organizations. Thousands of truckloads of supplies were sent.

Despite the charitable outpouring, some victims feel shortchanged. And there is often a disconnect between the realities of how much has been given and the vastness of the need.

Johnnie and Hurley Smith clung to their bedroom skylight to survive Katrina after eight feet of water inundated their home in Biloxi, Miss. They got $1,000 from the Red Cross to use for daily expenses such as lodging and food, and $100 and a new mattress from the Salvation Army. They ate Salvation Army and Red Cross meals, and their wrecked home was gutted by a church group.

Nevertheless, Johnnie Smith, 57, says she wishes a little more of the billions in donations had come her way.

"I should have been given more assistance," said Smith, a real-estate agent who is still unable to work and needs therapy to deal with the trauma of Katrina.

Some small groups along the coast complain that the big charities are ignoring them.

Saving Our Selves Coalition, a grass-roots recovery group, relies on money from smaller organizations and individuals.

"I would hope that the (big charities) won't move like our federal government is moving," said the group's founder, LaTosha Brown. "We're six months out, and people are still up in the air. The resources are not getting to the communities."

Charities are braced for hard decisions as they spend what is left. In December, 1,000 Gulf Coast ministers jammed into a New Orleans hotel ballroom to debate whether $20 million donated to faith organizations by the Bush-Clinton Katrina Fund should be divided among many organizations or focused on a few.

Their decision: rather than funding a "full dinner" for a limited number of groups, many organizations should receive a "sandwich," said the Rev. William Gray III, co-chairman of the fund's ministerial advisory panel.

Many homeowners and renters are turning to nonprofit groups after failing to qualify for government aid.

"We've been swamped" with inquiries, said Ken Meinert, senior vice president for Habitat for Humanity's Operation Home Delivery project, which is rebuilding 1,000 houses on the coast with the $80 million it has raised. It hopes to raise more money to build another 1,000 residences.

In its survey, The Post identified 15 charities that collected the most money, based on a database from the Center on Philanthropy of 141 charities raising money for hurricanes Katrina, Rita and Wilma.

The American Red Cross announced earlier this month that it had received enough donations to cover the $2.1 billion cost of its operation and asked donors to give to other hurricane-relief groups.

It is, however, reserving $194 million for its local chapters for long-term recovery, it said.

Other groups focused on longer-term programs are just gearing up.

The United Methodist Committee on Relief, an arm of the United Methodist Church, hasn't completed its strategic plan for the $69.6 million it raised from church collection plates. The group also has a $60 million contract from FEMA.