BATON ROUGE, La., Jan. 5 (UPI) -- A Louisiana Republican congressman is proposing an $80 billion plan to help New Orleans homeowners out of mortgage payments on non-existent properties.
Since Hurricane Katrina devastated the city in late August, U.S. Rep. Richard Baker of Baton Rouge has been trying to gain support in Washington to create the Louisiana Recovery Corporation, which would pay off lenders, restore public works, buy huge ruined chunks of the city, clean them up and then sell them back to developers.
Under his plan, the corporation would offer to buy out homeowners, at no less than 60 percent of their equity before Katrina, The New York Times reported. Lenders would be offered up to 60 percent of what they are owed.
To finance these expenditures, the government would sell bonds and pay them off in part with the proceeds from the sale of land to developers.
"In this case, everything's gone," Baker said. "And if we don't do this, what do you foresee for the region two years from now?"
