updated 12/18/2007 6:07:35 PM ET 2007-12-18T23:07:35

A week after Hurricane Katrina, a FEMA official in charge of streamlining the flow of disaster aid issued a directive that would have cut through the red tape and expedited a staggering 1,029 rebuilding projects and $5.3 billion.

The official issued a memo that said that once local and regional FEMA officials approve a project, Washington must release the money within three days.

But in a decision critics say led to the loss of precious time in New Orleans' recovery, FEMA higher-ups countermanded the order.

Instead, the rebuilding of schools, roads, hospitals, firehouses and other desperately needed infrastructure was held up for months of interagency reviews that ended at the White House Office of Management and Budget.

Gil Jamieson, FEMA's head of Gulf Coast recovery and one of the officials who countermanded the directive of Nancy Ward, said her order would have given federal agencies too little time to review requests for funding.

"There's certainly a responsibility that we have, and I have, as a civil service official, to ensure those dollars are going to the purposes they were intended," he said.

Director stands by her policy
However, despite FEMA's contention that added layers of review would save taxpayer dollars, not a single rebuilding project was amended, declared ineligible or kicked back for further scrutiny, federal officials acknowledge.

Ward, who later was promoted to FEMA's West Coast director and led its response to the recent California wildfires, stands by the policy she issued on Sept. 6, 2005. She was FEMA's Louisiana-based director of recovery command.

"We knew given the enormity of Katrina that we needed to get the money out quickly," said Ward, who was contacted after The Associated Press found her memo on the Web site of the Louisiana legislative auditor.

The procedure Ward wanted to shorten involves FEMA's "million-dollar queue," a basket in its computer system. It was created in 2000, when FEMA was an independent Cabinet-level agency, to handle projects of $1 million or more.

It was supposed to work like this: Once projects received the OK from local and regional officials, they were sent to the queue as a way of notifying Congress. The money for the project was supposed to be released within three days after that.

But when the Department of Homeland Security took over FEMA in 2003, the superagency decided to subject projects to additional layers of review — FEMA offices in Washington, then Homeland Security, then OMB.

The result of the added paper-pushing: After what should have been a momentum-building first year of recovery, a list of projects in the queue provided by Louisiana officials showed delays as long as 101 days, with an average of 34. As delays grew in 2006-07, frustrated state officials complained to FEMA. The longest waits dropped to 22 days.

But state officials said the damage had been done.

A 'bloated' system
"We discovered there was a black hole where all projects over a million dollars were sent," said Andy Kopplin, executive director of the Louisiana Recovery Authority. "This is certainly not true to the federal government's promise to rebuild."

Homeland Security spokeswoman Amy Kudwa declined to comment. OMB spokesman Sean Kevelighan said its review commonly takes a day.

A total of 1,029 hurricane rebuilding projects in Louisiana, Mississippi and Alabama with a combined value of $5.3 billion have been put in the queue.

Before any disaster project even gets to the queue, FEMA field officials scrutinize it down to the smallest details, such as the number of pencils lost at a school. The findings then go to FEMA regional clearinghouses, where they are further examined. The process takes months, even more than a year, and generates mountains of paperwork — in some cases, more than 1,000 pages per project.

Sen. Mary Landrieu, D-La., said the system is bloated and shrouded in mystery.

"The House of Representatives called the federal government's response to Katrina and Rita 'a failure of initiative,' and the resistance to clearing this bureaucratic roadblock is a sign of that failure," she said.

Copyright 2007 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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