FDIC chief named to disaster-relief job

President Bush yesterday named Donald E. Powell, chairman of the Federal Deposit Insurance Corp., to lead disaster-recovery efforts in the Gulf Coast region destroyed by Hurricanes Katrina and Rita.

The Texas native will serve as “coordinator of recovery and rebuilding in the Gulf Coast region” replacing Coast Guard Vice Adm. Thad Allen by the end of the year, and will answer to Department of Homeland Security Secretary Michael Chertoff.

“I am gratified that Don will be coordinating the federal government’s long-term effort to helping rebuild the devastated communities in the Gulf Coast region,” Mr. Chertoff said. “Don has the leadership, ideas and optimism that the residents of the Gulf Coast region deserve.”

Mr. Powell, former president and chief executive officer of the First National Bank of Amarillo, Texas, has served as chairman of the Federal Deposit Insurance Corporation (FDIC) since August 2001. He raised nearly $100,000 for Mr. Bush’s 2000 presidential campaign.

Mr. Powell will act as the primary point of contact with Congress, state and local governments and the private sector on rebuilding plans. Congress has so far appropriated $62 billion for hurricane cleanup and recovery in Mississippi, Louisiana, Alabama and Florida.

Republicans and Democrats have asked Mr. Bush to create a recovery chief to be in charge of all operations, and also to act as a watchdog over federal spending to prevent fraud.

Accusations of fraud and cronyism in contract decisions have been reported in Louisiana. In a special legislative session there beginning Sunday, lawmakers will vote on a bill to allow themselves and their family members to receive federal contracts.

Spending decisions in all of the states are also under scrutiny by a team of inspectors general from the Homeland Security Department.

Before yesterday’s announcement, leading House Democrats asked the inspector general for the Army Corps of Engineers to investigate contracts for blue tarp roofs for as many as 300,000 homes.

Reports suggest $300 tarps are being sold to the government for as much as $3,500, said Rep. Bennie Thompson of Mississippi, ranking Democrat on the House Homeland Security Committee, and Rep. Bill Pascrell Jr. of New Jersey, ranking Democrat on the subcommittee on emergency preparedness, science and technology.

The appointment of a coordinator did not ease the concerns of Mr. Thompson, who said decisions should be made locally, not by another “overseer” from the Homeland Security Department. “It is ironic and strange that an administration that has had so little success in responding to Hurricane Katrina thinks it can solve the problem by adding another layer of bureaucracy,” he said.