New Orleans settles Katrina claims

NEW ORLEANS, May 3 (UPI) -- New Orleans Mayor Ray Nagin announced Monday, just hours before leaving office, the city had settled Hurricane Katrina claims with an insurance company.

Nagin said in a 5:02 a.m. news release the city will receive the first of two $11.8 million payments from the unnamed firm within two weeks, The (New Orleans) Times-Picayune reported. It was not known whether new Mayor Mitch Landrieu, who was sworn in at midmorning, had been apprised of the settlement, the newspaper said.

The Nagin administration had sued in federal court to obtain $23.6 million in unpaid insurance claims arising from the 2005 storm.

"Congratulations to the City Attorney's Office for remaining vigilant and focused on resolving this claim that will rightly return more than $20 million more to the city for damages resulting from Hurricane Katrina," Nagin said in his statement. "This is a testament to the many 'quiet' challenges that we have overcome to secure disaster funding and resources to rebuild this city."

City Attorney Penya Moses-Fields said she was "especially proud" with the results that will return the money to the city.

"We, as a city, have been operating very creatively on limited funding," she said. "These insurance funds will greatly assist our recovery team in their rebuilding efforts."