La. Proposal Would Create State-chartered Bank for Hurricane Recovery

A Louisiana state-chartered bank would be created, touted as a way to spur private investment in the rebuilding of public infrastructure devastated by Hurricane Katrina, under a bill nearing final legislative passage.

The bill by Sen. Ed Murray, D-New Orleans, would create the Louisiana Infrastructure Bank, run as a branch of the state treasury. But it hinges on financing that New Orleans Mayor Ray Nagin and city officials haven’t disclosed.

Rep. Cedric Richmond, D-New Orleans, said Ed Blakely, the city’s recovery chief, sought the legislation. Richmond said the bank would serve as a depository for private investors seeking to help finance public recovery efforts in south Louisiana _ though the bill also allows for receipt and use of federal and state funds.

It would also offer local government entities low-interest loans to help jump-start infrastructure projects that are eligible for reimbursement by the Federal Emergency Management Agency’s Public Assistance Program.

Despite several lawmakers’ concerns, the measure passed 100-2 in the House. It now returns to the Senate for approval of changes.