Galveston holding onto hope after Ike

Neighborhoods remain desolate, dotted with ghostly homes or apartments sometimes emptied of their flood-damaged contents by burglars or frozen in time, just as they were when Ike's 12-foot storm surge rumbled ashore near the city on Sept. 13.

Galveston Island, once a major port city, rebuilt itself after a hurricane that still stands as the nation's deadliest disaster wiped out the community in 1900, killing 6,000. But it was always a shell of its former self, with a mostly working-class population dependent on service jobs from the lifeblood tourism industry, despite a slew of vacation homes along the beach.

Some worry that Hurricane Ike, followed by the recession, may deliver the island's coup de grace. Hearty island residents, however, hold out hope.

"This is not a good time to be recovering from a disaster," said Robert Olshansky, a professor at the University of Illinois at Urbana-Champaign, who studies urban renewal after natural disasters.

Since Ike blew in, the city's population has dropped from 58,000 to 45,000. Half the city's businesses -- most of them tourism based -- are still closed. The city, with an annual budget of about $80 million, suffered at least $1.4 billion in damage to its infrastructure.

Last week, Galveston's school district announced it would have to eliminate 163 jobs, including 99 teaching positions for the next school year, following layoffs of 50 workers the month before. A 25 percent drop in student population will likely result in a $17 million loss in state funding.

About 100 city workers will probably have to be laid off by next month as the city's revenues tumble. Property tax revenues are expected to be down 35 percent, sales tax revenue is expected to be 10 percent less and other revenues are set to be down 2 percent.

And the city's and county's biggest employer -- the University of Texas Medical Branch at Galveston, laid off 3,000 workers shortly after the storm and is counting on hundreds of millions from the state to help it rebuild.

Galveston doesn't have the star power of New Orleans, which attracted tremendous celebrity support after its devastating losses from 2005's Hurricane Katrina. There, Brad Pitt set up a foundation to build low-income housing; other movie stars made high-profile pilgrimages to lend a hand; Spike Lee made a documentary. A fund set up by former presidents George H.W. Bush and Bill Clinton for Katrina victims raised about $130 million.

But the area's homegrown celebrities, like Beyonce or ZZ Top, haven't held charity concerts or raised money for the island that serves as Houston's backyard. Bush and Clinton set up a similar fund after Ike, but it raised only about $2.5 million.

Yet people who live on an island one hurricane season after another are made of hearty stuff. Many residents, business owners and community leaders believe the city will come back.

"If you live here, you love it. Everybody I know wants to bring it back and expect for it to come back. I get real upset when I hear people bad mouth Galveston because you have to give us a chance," said Charlene Grant, who had 18 inches of water in her home. Her neighborhood, like many in Galveston, hums with the sounds of reconstruction from electric saws and generators.

Galveston City Manager Steve LeBlanc said the city has already received $267 million in federal funding to rebuild housing and infrastructure and will be able to borrow up to another $40 million for operating expenses. The city has asked the state Legislature to allow it to keep $100 million in sales tax revenue it would normally turn over to the state.

But it will take years to repair the city's housing, restore its financial health and infrastructure and create jobs.

"We keep fighting every day for Galveston. Everything we do we are fighting for Galveston's recovery, survival and betterment for the days ahead," LeBlanc said.

Construction workers still outnumber tourists along The Strand, Galveston's Victorian historic district, but shopkeepers say the progress being made gives them hope.

"Doom and gloom" was how store owner Keith Bassett described the mood after Ike inundated most downtown businesses with murky water and dark mud mixed with sewage, grease and oil.

"I didn't think The Strand would be open for years. I'm amazed at how quickly things are back at some semblance of normal," said Bassett, who lost two businesses and decided to only reopen one.

Texas billionaire George Mitchell, who was born in Galveston and owns 20 downtown buildings, is spending about $13 million beyond his insurance payments to fix his damaged downtown buildings. He said he hopes that up to 90 percent of the businesses in his buildings will be open again in the next three months.

As Galveston recovers, city leaders have been careful to promote the message that the island community is open to visitors.

Galveston is heavily dependent on tourism, which in 2007 had an $808 million impact on the local economy and drew 5.4 million visitors. Tourism is responsible for 9,300 jobs, representing 30 percent of the city's work force.

The city held scaled-down versions of its traditional December "Dickens on The Strand" festival and Mardi Gras celebration. Crews are replenishing sand along a 51-block stretch of beach before spring break and the summer tourist season.

Harvey Morken, of Casselton, N.D., marveled at the progress on The Strand.

"It's amazing to us the destruction and how hard they are working to put it back together," he said.

But Galveston resident Mike Zientek said he thinks the city's efforts to restore tourism are a bit premature.

"You want to take care of the residents before you want to throw a party and invite people over," said Zientek, a 47-year-old contractor who has been living in a hotel since Ike dumped 5 feet of water in his home.

Some in Galveston were hoping lawmakers would pass a proposal allowing a casino on the island. Two area state representatives, Democrats Carol Alvarado of Houston and Craig Eiland of Galveston, filed such a bill Thursday.

While hope keeps Galveston hammering away at recovery, some residents worry that bringing Galveston back to its pre-Ike self isn't enough and won't solve the problems that existed before Ike. The island's tourism jobs are mostly in the service industry and are low wage.

Both UTMB, which is home to the state's oldest medical school and a public hospital that has served uninsured residents from throughout the state, and the school district were operating in the red. The city had a poverty rate of 22.5 percent, higher than the U.S. rate of 13.3 percent. The median household income was $34,153, less than the rest of Texas ($46,248) and the nation ($50,007). From 1990 to 2007, Galveston lost 3.6 percent of its population while Texas' population increased by 43.2 percent, according to U.S. Census figures.

"The problem I come back to is you have to have a prosperous economy to get people to move here and allows them to live so they can make a middle class income," said resident David Stanowski, who writes a blog on Galveston's economy.

Olshansky said a natural disaster can present a community with a chance to change itself.

"But it's unrealistic to think you can totally reinvent a place," he said. "Everybody wants to rebuild better than it was before. At the same time, everyone is deeply rooted in the previous reality."

The city's longterm recovery committee, made up of more than 300 residents, wants to build a plan for Galveston's post-Ike future.

Some of the ideas the committee has discussed include increasing middle-class housing, a $3 billion proposal called the "Ike Dike" that would extend the island's seawall and install moveable flood gates, tax breaks to encourage people to live on the island and a casino gaming district. The committee is narrowing down its list of ideas for its recovery plan, which it is set to present to the city council next month.

Chairwoman Betty Massey said the committee's mere existence gives residents hope, "that there is that proverbial light at the end of the tunnel, that we are taking control of our own future and taking steps to get there."