BATON ROUGE, La. -- The state on Friday decided to let an arbitration panel settle its dispute over the federal government's tab for Hurricane Katrina damage to a New Orleans hospital.
Gov. Bobby Jindal's administration submitted documents outlining the decision to challenge the Federal Emergency Management Agency's $150 million offer to cover damage at Charity Hospital. The state believes it's due nearly $500 million to replace the hospital.
FEMA has said the state did not do enough to protect the building from further decay after the 2005 storm, resulting in the lower offer.
Commissioner of Administration Angele Davis said the Office of Facility and Planning Control has "consistently demonstrated that the hospital was more than 50 percent damaged by Hurricane Katrina, qualifying it for full replacement cost" under the FEMA regulations.
"We believe arbitration by an independent body is the best option for an expedited settlement of this long-standing dispute, which has stalled the state's efforts to build a state-of-the-art medical facility that would provide world-class medical care and medical education and research to the entire Gulf region," Davis said.
Clark Stevens, a spokesman for FEMA, said the agency believes the arbitration process "provides an important additional option for remaining public assistance projects."
"We look forward to the arbitration panel's resolution on Charity Hospital and other eligible projects as we continue to work with state and local leadership to help the Gulf Coast rebuild," Stevens said.
Congress this year authorized creation of an arbitration system for infrastructure projects related to hurricanes Katrina and Rita.
U.S. Sen. Mary Landrieu, D-La., was among those pushing for a way to end the drawn-out bickering that had bogged down projects and the speed of funds to get roads, buildings and other infrastructure rebuilt.
(Copyright 2009 by The Associated Press. All Rights Reserved.)
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