Mississippi coastal town hopes post-Katrina tax base will recover as an unlikely hero emerges

JACKSON, Miss. - On the morning the Wal-Mart reopened this week in Pass Christian, rain cancelled a small parade Mayor Chipper McDermott had planned, so folks stood inside the store and handed out gaudy Mardi Gras beads instead of throwing them from a float.

They might as well have been tossing dollars into the town treasury, and McDermott knows it.

Recovery from Hurricane Katrina has been slow in Pass Christian (kriss-chee-ANN'), a picturesque coastal town once filled with antique shops, artists' galleries and century-old homes. Katrina's surge caused massive structural damage to the community and sucked away much of the local tax base when it struck Aug. 29, 2005.

While the opening of Wal-Mart in some towns has been greeted with fears that the retailing giant would hurt locally owned businesses, there wasn't a flinch this week in "the Pass," as locals call it, where many of the mom-and-pop shops still haven't come back.

"We've got a new neighbour that was an old neighbour that we're damn sure glad is back," McDermott said from his town about 65 miles (105 kilometres) east of New Orleans.

His assessment says a lot about what Pass Christian has been through since Katrina's eye came ashore just west of town, near the Bay of St. Louis.

The hurricane erased the local harbour where generations of shrimpers had docked their boats, though it has since been rebuilt. The population plunged - from 6,579 in 2000 to 3,993 by 2008, according to the Census Bureau. Many people haven't returned because they can't afford the rising cost of insurance for homes or businesses.

The Wal-Mart store that was gutted by Katrina was only a few hundred meters from the shore. The new one is further inland and sits at a higher elevation.

Thousands of volunteers from around the nation converged on Pass Christian, especially in the first year after the storm. College students and church groups helped build parks and rip mouldy carpeting out of damaged homes. Many lived in a tent city erected in the centre of town.

"It was something of great pride for us to see the youth of America and see the conditions they could live under and function. They would come and do the dirtiest jobs," said Sally James, director of Pass Christian Public Library.

City hall, the police department and the library are still operating in temporary trailers while new buildings are constructed with a combination of local, state and federal money.

With no local supermarket since Katrina, people have been forced to make a long drive to buy anything more than bread and milk at convenience stores or inexpensive items at two local dollar stores.

Diane Peranich, a Democrat who has represented the Pass Christian area in the state House of Representatives for nearly 21 years, said that until this week, the town had been without a place to fill a prescriptions or buy eyeglasses for more than four years.

State Tax Commission records show the town collected $498,694 in sales taxes during the year ending June 30, 2003 - the last full year before Walmart opened. The city's collections jumped to nearly $1.2 million the following year, and nearly $1.3 million the next year.

After Katrina, sales tax collections dropped to $608,070. They plunged to $375,491 in the year ending June 30, 2008, the most recent figures available.