Lower mortgage rates, prices lift U.S. new home sales to one-and-a-half-year high

FILE PHOTO: A real estate sign advertising a new home for sale is pictured in Vienna, Virginia, U.S. October 20, 2014. REUTERS/Larry Downing/File Photo

By Lucia Mutikani

WASHINGTON (Reuters) – Sales of new U.S. single-family homes rose to a near 1-1/2-year high in March, boosted by lower mortgage rates and house prices.

The third straight monthly increase reported by the Commerce Department on Tuesday suggested some recovery was under way in the housing market, which hit a soft patch last year against the backdrop of higher borrowing costs and more expensive homes.

“In this housing market, affordability for buyers is key,” said Danielle Hale, chief economist at realtor.com. “This trend supports the fact that lower mortgage rates have started to entice buyers this spring and foreshadows a potential strengthening of existing home sales in the months to come.”

New home sales increased 4.5 percent to a seasonally adjusted annual rate of 692,000 units last month, the highest level since November 2017.

February’s sales pace was revised down to 662,000 units from the previously reported 667,000 units. Economists polled by Reuters had forecast new home sales, which account for about 11.7 percent of housing market sales, decreasing 2.5 percent to a pace of 650,000 units in March.

New home sales are drawn from permits and tend to be volatile on a month-to-month basis. They increased 3.0 percent from a year ago.

The median new house price dropped 9.7 percent to $302,700 in March from a year ago, the lowest level since February 2017. A separate report on Tuesday from the Federal Housing Finance Agency (FHFA) showed its house price index rose a seasonally adjusted 4.9 percent in February from a year ago.

That followed a 5.6 percent increase in January. The FHFA’s index is calculated by using purchase prices of houses financed with mortgages sold to or guaranteed by mortgage finance companies Fannie Mae and Freddie Mac.

U.S. financial markets were little moved by the new home sales data.

New home sales have not been severely impacted by the supply problems that have plagued the market for previously owned homes. A report on Monday showed home resales tumbled in March, weighed down by a persistent shortage of lower-priced houses.

Despite the broader housing market’s struggles with supply, the fundamentals for housing are strengthening. The 30-year fixed mortgage rate has dropped by about 80 basis points since November, according to data from mortgage finance agency Freddie Mac. That followed a recent decision by the Federal Reserve to suspend its three-year monetary policy tightening campaign.

In addition, house price inflation has slowed and wage growth has picked up. Still, land and labor shortages are constraining builders’ ability to break more ground on lower- priced housing projects. Investment in homebuilding contracted 0.3 percent in 2018, the biggest drop since 2010.

New home sales in the South, which accounts for the bulk of transactions, increased 3.6 percent in March to their best level since July 2007. Sales in the Midwest soared 17.6 percent to an 11-month high, while those in the West surged 6.7 percent to their strongest level in a year.

But sales in the Northeast tumbled 22.2 percent.

There were 344,000 new homes on the market last month, down 0.3 percent from February. At March’s sales pace it would take 6.0 months to clear the supply of houses on the market, down from 6.3 months in February.

About 62 percent of the houses sold last month were either under construction or yet to be built.

(Reporting by Lucia Mutikani; Editing by Andrea Ricci)

After devastating flooding, U.S. Midwest farms need more than ‘paper towels’ to recover

A combination of aerial photos show the farm of Richard Oswald near Langdon, Missouri after flooding March 20, 2019 and in the fall of 2018 at right. Courtesy of Richard Oswald/Handout via REUTERS.

By Andrew Hay

(Reuters) – Missouri farmer Richard Oswald needs a lot of help to recover from flooding that left his home and farm looking like a manmade island in an inland sea.

Relief groups are giving tetanus shots and handing out free meals and cleaning supplies near his farm in the Langdon-Rock Port area, about 100 miles (161 km) northwest of Kansas City. But what Oswald really needs is money.

Hit by the worst flooding in living memory, he and thousands of other farmers along the Missouri River will each require hundreds of thousands of dollars in disaster funds or loans to start over.

“The typical response on flood relief is groups like the Red Cross show up with paper towels and rubber gloves and scrub buckets,” said Oswald, 69, who does not expect to be able to get to his home or land for weeks. “The biggest thing farmers need is cash, or ways to access funds.”

‘BOUNCE BACK’

Slammed by a trade war and low commodity prices, Midwest family farms have been in the red and in decline for the last five years. The number of U.S farms fell by 100,000 between 2010 and 2017, according to U.S. Department of Agriculture (USDA) data.

Thousands more will now go under without emergency financial support for flooding, pummeling heartland economies almost entirely dependent on agriculture, farmers and aid groups said.

It is a call federal and state agencies, as well as non-governmental and faith-based relief groups are answering.

President Donald Trump has approved disaster declarations for Nebraska and Iowa, making federal disaster funding available in flood-hit areas. Missouri Governor Mike Parson declared a state of emergency, paving the way for similar actions in his state.

“I know we aim for bringing everything back up to where it was,” said Rosalynn Days-Austin, a USDA emergency coordinator helping direct Federal Emergency Management Agency (FEMA) efforts in flood-affected areas. “Sometimes that’s not always possible, for a variety of reasons, but the goal is definitely to help them bounce back from their loss.”

CASH PREFERRED

Relief groups like Farm Aid are tending to the immediate needs of farmers, distributing tens of thousands of dollars in “emergency grants” – $500 gifts from cash donations that help families pay for things like groceries. After that, the group and its partners advise farming families on how to access federal disaster funds they hope are coming soon.

“What we’re hearing, because of the snowpack and rain and the wet ground, is that farmers are going to be dealing with this throughout the spring. So we’re in it for the long haul,” said Jennifer Fahy, a spokeswoman for the group established by country singer and activist Willie Nelson.

The Evangelical Lutheran Church in America (ELCA) is coordinating a long-term response to get displaced families housed, navigate the red tape of insurance companies and federal agencies and tend to the mental health needs of people who have suffered extreme trauma, said Bishop Brian Maas.

“We have national partners and coalitions within the state,” said Maas, who is asking people to hold off donating more material goods, for now. “There will be stresses because we’ve not done anything of this magnitude.

“Now we have mountains of cleaning supplies and so forth that can’t be used,” Maas said, appealing to people to get back in touch in a month to see how they can donate then. “Cash is the most flexible way to respond.”

‘FEMA IS WORTHLESS’

Another immediate need is feed for livestock.

Relief organization Farm Rescue is collecting donations of hay in the Dakotas and trucking it to farmers whose cattle are starving after their feed stands were submerged in floodwater.

“I don’t know of anything this widespread that has ever affected so many people in our service area,” said Dan Erdmann, a spokesman for the group which helps family farms get through crises ranging from natural disasters to medical emergencies.

Farmworkers, some of them undocumented and legal migrants, have been hit hard. Lutheran Family Services of Nebraska is looking at housing assistance for displaced people who previously paid around $300 a month rent and now face rents triple that due to a dearth in properties, said Stacy Martin, chief executive of the social services charity.

While relief groups tend to urgent needs, farmers like Scott Olson say more federal relief money is needed at a time when low crop prices and high debt levels are limiting farmers’ access to credit. He is counting on a farm relief bill in Congress for extra disaster compensation after he successfully lobbied in Washington for similar funds following 2011 flooding.

“Flood insurance isn’t going to cover this worth a darn. FEMA is worthless,” said Olson, who farms 3,000 acres near Tekamah, Nebraska and runs a farm equipment business. “They don’t have any money, nobody has any money.”

(Reporting by Andrew Hay in New Mexico; Additional reporting by Tom Polansek in Chicago; editing by Bill Tarrant and Lisa Shumaker)

No vacancy: Housing crisis dogs Florida Keys months after Irma

Terri Metter, 50, and her Boston Terrier Nikki stand in front of a debris-filled canal in the RV park where she has been living in a FEMA trailer since November 2017, in Marathon, Florida, U.S., June 10, 2018. REUTERS/Zach Fagenson

By Zachary Fagenson

MARATHON, Fla. (Reuters) – For eight months Terri Metter has made her home in a government trailer parked along a debris-clogged canal in the Florida Keys and she considers herself lucky since Hurricane Irma forced many of her former neighbors to move off the once-idyllic archipelago.

Terri Metter and her Boston Terrier Nikki overlook what's left of destroyed trailers that fill a canal near a trailer park in Marathon, Florida, U.S., June 10, 2018. REUTERS/Zach Fagenson

Terri Metter and her Boston Terrier Nikki overlook what’s left of destroyed trailers that fill a canal near a trailer park in Marathon, Florida, U.S., June 10, 2018. REUTERS/Zach Fagenson

Metter has been bunked down in temporary housing supplied by the Federal Emergency Management Agency (FEMA) since November, after the Category 4 storm, with winds of up to 130 miles per hour (209 kph), strafed nearby Cudjoe Key on Sept. 10, 2017.

“A few people are finding housing on boats or they’re sleeping on couches, but a lot of people who work here can’t afford to stay and it’s a sad thing,” said the 50-year-old bookkeeper and bartender in Marathon, a city made up of 13 tiny islands about 50 miles east of Key West and 115 miles southwest of Miami.

Though much of mainland Florida escaped major damage, the Keys were devastated. The resort islands, stretching southwest from the tip of the Florida Peninsula into the Gulf of Mexico, are connected by a single, narrow highway that runs along a series of bridges and causeways.

The hurricane destroyed almost 1,200 homes in Monroe County, which includes the Keys and parts of the mainland that are almost entirely in Everglades National Park. That figure excludes trailers, a popular form of housing in the Keys, and homes damaged so severely that owners simply abandoned them.

Overall, 84 people in Florida died as a result of Irma, and the region, including other southeastern states, suffered an estimated $50 billion worth of damage, according to the National Hurricane Center.

As the hurricane approached, Metter evacuated and stayed with family in Michigan, but returned a month later to see the devastation in her neighborhood, where only eight of 50 trailers and homes remained intact. Rotting debris and seaweed filled her home, and she decided rebuilding was the only option.

Others had no choice but to live elsewhere. A lack of affordable, safe housing forced many of those who work in the Keys’ numerous restaurants and hotels to move to the mainland, officials said.

“Folks are living in unlawful spaces that don’t meet code, unsafe spaces, and they have been doing it because they want to be there and it’s the only way they can afford to be there,” said Jaimie Ross, president of the Florida Housing Coalition.

Monroe County Commissioner George Neugent expects many who lost their homes or suffered major damage to never come back. In 2016, the county’s population totaled about 79,000, almost all of them residing in the Keys, according to the U.S. Census Bureau.

“I’m estimating between 15 and 25 percent of our population is going to be lost and we lose more and more every day,” he said.

To put a dent in the housing deficit, Monroe County has teamed with private developers and donors on a plan to build homes capable of withstanding 200 mile-per-hour winds that are affordable for hospitality workers. Florida Governor Rick Scott and state lawmakers are also weighing a proposal for 1,300 new housing units for workers in the Keys.

The construction cannot come fast enough as the region braces for what this year’s hurricane season, which began June 1, will bring to the region.

The National Oceanic and Atmospheric Administration’s Climate Prediction Center expects the season to be a near-normal to above-normal season in terms of the number and intensity of storms.

The long recovery from Irma and the previous hurricane season has raised doubts with many, said Neil Curran, 45, a contractor and waiter who lost the 42-foot sailboat where he lived off Key West during last year’s storm.

While Curran is renting a new boat after bouncing around more than a dozen FEMA-funded hotel rooms, he said he knew of at least two dozen friends who have left the islands, and more on the cusp of leaving.

“Over the summer, we’re going to see a pretty big mass exodus,” he said.

(Reporting by Zachary Fagenson; editing by Ben Klayman, Frank McGurty and G Crosse)

U.S. Stock Markets Bounce Wall Street recovers after historic falls

A trader reacts on the floor of the New York Stock Exchange in New York, U.S., February 6, 2018.

By Tanya Agrawal

(Reuters) – U.S. stock markets bounced after a torrid opening on Tuesday, bargain-hunters and gains for Apple pushing the tech-heavy Nasdaq and the Dow Jones Industrial Average into positive territory after two days of heavy losses.

Both the S&P 500 and the Dow sank more than 4 percent on Monday, their biggest falls since August 2011, as concerns over rising U.S. interest rates and government bond yields hit record-high valuations of stocks.

New York’s three main indexes sank as much as 2 percent on the opening bell but they quickly moved back into positive territory.

An almost 2 percent gain for Apple was at the heart of an almost half percent gain for the Nasdaq Composite.

“Daily drops of 3 percent or more have been buying opportunities for the S&P 500 post financial crisis,” said Lori Calvasina, head of U.S. equity strategy at RBC Capital Markets.

At 9:49 a.m. ET (1449 GMT), the Dow Jones Industrial Average gained 0.25 percent to 24,406.14. The S&P 500 rose 0.2 percent to 2,654.25 and the Nasdaq 0.4 percent to 6,993.47.

(Reporting by Tanya Agrawal; Editing by Arun Koyyur and Patrick Graham)

Trump Cabinet officials to visit Puerto Rico to assess recovery

Trump Cabinet officials to visit Puerto Rico to assess recovery

By Roberta Rampton

WASHINGTON (Reuters) – Two members of President Donald Trump’s Cabinet are set to visit Puerto Rico on Tuesday to assess the U.S. territory’s rebuilding in the three months since Hurricane Maria devastated homes, businesses and the power grid.

Homeland Security Secretary Kirstjen Nielsen and Housing and Urban Development Secretary Ben Carson will travel to Puerto Rico, where about a third of the island’s 3.4 million residents are still without power, hundreds remain in shelters, and thousands have fled to the U.S. mainland.

The visit comes as Republicans in the U.S. House of Representatives on Monday were planning to unveil a disaster aid package totaling $81 billion, according to a senior congressional aide. Some of that aid would go to Puerto Rico, but also to states like Texas and Florida that were hit by other hurricanes and to California, which is grappling with wild fires.

Even before Maria savaged Puerto Rico, the island was contending with $72 billion in debt. Puerto Rican Governor Ricardo Rossello has asked the federal government for a total of $94.4 billion in aid, including $31.1 billion for housing and $17.8 billion to rebuild its ruined power grid.

The Federal Emergency Management Agency (FEMA) has so far approved more than $660 million in aid for individuals in Puerto Rico as well as more than $450 million in public assistance.

Nielsen and Carson will receive detailed briefings on rebuilding efforts and see how federal aid is helping residents to recover, a DHS official said.

Nielsen, who oversees FEMA, and Rossello are slated to hold a news conference.

The visit comes as Congress prepares to vote on a tax overhaul bill that Puerto Rican officials have said they fear will hurt the commonwealth’s pharmaceutical manufacturing sector – the cornerstone of the island’s economy – at a time when Puerto Rico can least afford to lose jobs and tax revenue.

Puerto Rico’s government has said 64 people died because of the hurricane, but after multiple media estimates of dramatically higher figures, Rossello on Monday ordered an official review of the death toll.

(Reporting by Roberta Rampton; Editing by Leslie Adler)

Schumer calls on Trump to appoint official to oversee Puerto Rico relief

Senate Minority Leader Charles Schumer (D-NY) departs after a full-Senate briefing by Deputy U.S. Attorney General Rod Rosenstein at the U.S. Capitol in Washington

By Pete Schroeder

WASHINGTON (Reuters) – Charles Schumer, the top Democrat in the U.S. Senate, called on President Donald Trump on Sunday to name a single official to oversee and coordinate relief efforts in hurricane-ravaged Puerto Rico.

Schumer, along with Representatives Nydia Velàzquez and Jose Serrano, said a “CEO of response and recovery” is needed to manage the complex and ongoing federal response in the territory, where millions of Americans remain without power and supplies.

In a statement, Schumer said the current federal response to Hurricane Maria’s impact on the island had been “disorganized, slow-footed and mismanaged.”

“This person will have the ability to bring all the federal agencies together, cut red tape on the public and private side, help turn the lights back on, get clean water flowing and help bring about recovery for millions of Americans who have gone too long in some of the worst conditions,” he said.

The White House did not immediately respond to a request for comment.

The Democrats contended that naming a lone individual to manage the government’s relief efforts was critical, particularly given that the Federal Emergency Management Agency is already stretched thin from dealing with other crises, such as the aftermath of Hurricane Harvey in Texas and the wildfires in California.

The severity of the Puerto Rico crisis, where a million people do not have clean water and millions are without power nearly a month after Hurricane Maria made landfall, demand a single person to focus exclusively on relief and recovery, the Democrats said.

Forty-nine people have died in Puerto Rico officially, with dozens more missing. The hurricane did extensive damage to the island’s power grid, destroying homes, roads and other vital infrastructure. Now, the bankrupt territory is struggling to provide basic services like running water, and pay its bills.

“It’s tragically clear this Administration was caught flat footed when Maria hit Puerto Rico,” said Velàzquez. “Appointing a CEO of Response and Recovery will, at last, put one person with authority in charge to manage the response and ensure we are finally getting the people of Puerto Rico the aid they need.”

On Thursday, Trump said the federal response has been a “10” on a scale of one to 10 at a meeting with Puerto Rico Governor Ricardo Rossello.

The governor has asked the White House and Congress for at least $4.6 billion in block grants and other types of funding.

Senator Marco Rubio called on Congress to modify an $18.7 billion aid package for areas damaged by a recent swath of hurricanes to ensure that Puerto Rico can quickly access the funds.

 

(Reporting by Pete Schroeder; Editing by Lisa Von Ahn and Diane Craft)

 

U.S. mail carriers emerge as heroes in Puerto Rico recovery

Luis Menendez, a mail man for the U.S. Postal Service, delivers mail at an area affected by Hurricane Maria in the island of Vieques, Puerto Rico.

By Hugh Bronstein

GUAYNABO, Puerto Rico (Reuters) – With the Puerto Rico power grid shredded by Hurricane Maria, the U.S. Postal Service has taken the place of cellphone service at the forefront of island communications.

Only 15 percent of electrical power has been restored since the storm bludgeoned the U.S. territory on Sept. 20, but 99 of Puerto Rico’s 128 post offices are delivering mail. Tents have taken the place of post offices wrecked by Maria.

Mail carriers gather information on sick and elderly residents in far-flung parts where hospitals have closed. Data is fed into the Federal Emergency Management Agency disaster relief office in San Juan so medical attention can be provided.

Restoration of the power grid is months away and many rural roads are blocked by mudslides, sink holes and downed trees and telephone poles. Since the start of the month the Postal Service has nonetheless been delivering letters and care packages to family members desperate for news.

“It’s been a clutch situation, and you guys have totally come through,” a FEMA worker was heard telling Postal Service Caribbean customer service manager Martin Caballero on Sunday.

“We might know the general area where people need help, but the mail carriers are the only ones who really have the exact addresses,” the FEMA worker told Reuters, asking not to be named because he was not authorized to speak to news media.

Caballero regularly goes on AM radio, which can be heard by listeners lucky enough to have diesel to run generators, to tell people in inaccessible parts of the island where their mail is being held. He invites them to pick it up, but only when travel conditions become safe.

Even for urban middle-class customers in the San Juan suburb of Guaynabo, whose concrete homes were not smashed by the storm, it was a chore to recover their blown-away mailboxes or build new ones. Hurricane or not, the Postal Service will not drop off mail without a designated box.

“The wind took them all,” said resident Jenny Amador, a 42-year-old teachers’ assistant.

“I found mine in those trees,” she said, pointing to a gnarl of branches and trunks on the road. She re-attached her mailbox in a cockeyed position in front of her house, using a clothes hanger.

One plucky woman, having heard the postman was on the way, stood stoically with her mailbox tucked under her arm. No one minded when mail carrier Alfredo Martinez showed up out of uniform, unable to do laundry for lack of clean water.

One resident said the return of the mail service was comforting, a sign of a return to normalcy. But another greeted Martinez with a warning.

“If you are bringing me any utility bills, go away,” she said.

 

(Reporting by Hugh Bronstein; Editing by Howard Goller)

 

In Harvey’s aftermath, a flood of emotions as rebuilding begins

In Harvey's aftermath, a flood of emotions as rebuilding begins

By Bryan Sims

HOUSTON (Reuters) – For Texas residents affected by Hurricane Harvey, life in the storm’s aftermath involves juggling insurance claims, home repairs and work. But coping with loss is stirring very different feelings.

Staff at the Sugar Land campus of the University of Houston began their first day at work on Tuesday sharing storm experiences and consoling those whose homes were damaged.

“It’s very healing for people,” Kathryn Tart, dean of the university’s College of Nursing, said. “It helps us move on to the really difficult next stage – rebuilding.”

In an area of West Houston where some 3,000 homes suffered severe flooding and where water releases from two reservoirs continue to swamp neighborhoods, anger surfaced.

“I look out my kitchen window and there is a river that will always be there,” said Bryant Banes, who is a lawyer. He filed a lawsuit against the U.S. government in federal court claiming damages to his and neighbors’ homes and businesses from the reservoir releases.

The decision to release waters to relieve pressure on the reservoirs amounted to an improper taking of property, the lawsuit claims. “People have lost their homes and it is their responsibility to compensate residents,” Banes said.

Flood-damaged contents from people's homes line the street following the aftermath of tropical storm Harvey in Wharton, Texas, U.S., September 6, 2017. REUTERS/Mike Blake

Flood-damaged contents from people’s homes line the street following the aftermath of tropical storm Harvey in Wharton, Texas, U.S., September 6, 2017. REUTERS/Mike Blake

Harvey hit Corpus Christi in southern Texas on Aug. 25 but took the greatest toll on Houston and areas east of the city. The storm killed as many as 60 people, dumped more than 50 inches (127 cm) of rain and caused damages estimated as high as $180 billion, including to 312,000 homes along the coast.

The U.S. House of Representatives on Wednesday approved roughly $8 billion in initial emergency aid for Harvey relief and rebuilding. A Senate vote is expected later this week.

In Houston’s theater district, which sits along a drainage bayou, performances have been canceled indefinitely as assessments of repairs continue. Houston Grand Opera, Hobby Center for the Performing Arts and Alley Theatre reported flooding to some buildings and parking areas.

In east Texas, Hardin County residents were only able to return to homes on Tuesday. “Water is just now receding,” said Theresa Wigley, the county’s emergency management coordinator. “Recovery is going to be slow.”

The number of people reported missing in Houston, which climbed as high as 137 last week, was down to 18 on Wednesday as families reunited, said Beth Alberts, head of the Texas Center for the Missing.

“It is tragic and wonderful when we can match up people,” she said.

At the same time, more of the region’s energy industry was coming back online. Refiner Phillips 66 <PSX.N> said on Wednesday its Sweeny, Texas, refinery would return to full production by mid-month. Gasoline futures <RBC1>, which spiked last week, were off 2 percent on Wednesday.

Two other storms are threatening energy infrastructure in the Caribbean and Mexico. Hurricane Irma is taking aim at Puerto Rico and Florida, and Tropical Storm Katia is off the Mexican state of Veracruz and forecast to become a hurricane in a couple of days, the National Weather Service said on Wednesday.

(Reporting by Bryan Sims; Writing by Gary McWilliams; Editing by Leslie Adler)

Houston quickens pace of Harvey recovery as new storm threatens U.S.

Vince Ware moves his sofas onto the sidewalk from his house which was left flooded from Tropical Storm Harvey in Houston, Texas. REUTERS/Adrees Latif

By Gary McWilliams and Daniel Trotta

HOUSTON (Reuters) – Houston area residents picked up the pace of their recovery from Hurricane Harvey on Tuesday, jamming roads as they returned to offices and schools to help get the nation’s fourth largest city and its vital shipping and oil industries back on track.

The region is getting a boost from Mexico, which sent volunteers to shelters and is preparing to send relief supplies in the next few day. Mexican Red Cross workers were staffing shelters in three Texas cities. “We are more than glad to be helpful,” said Gustavo Santillan.

Large employers, universities and transit services reopened or began full schedules on Tuesday, with floodwaters receded and the Labor Day weekend behind them. But not all of the Houston-area’s 6.6 million residents were in position to go back to work and were dealing with home repairs and waterlogged possessions.

“It feels surreal to be back at work,” said Hannah Smith, 31, who spent part of her day putting office furniture moved ahead of the storm back in place “It is one step in the direction of whatever the new normal is.”

Harvey tore through Corpus Christi in southern Texas on Aug. 25 before churning up the coast and hitting the Houston area especially hard. The storm killed as many as 60 people, dumped more than 50 inches (127 cm) of rain and caused damages estimated as high as $180 billion, including to 203,000 homes.

Oil refineries, pipelines and shipping channels in the nation’s energy center have begun a gradual return to operations. Exxon Mobil on Tuesday said its fuel terminals in the Houston area were supplying gasoline and it continues to work on reopening a shuttered Baytown oil refinery. Motiva Enterprises [MOTIV.UL], operator of the nation’s largest refinery, said it is in the process of restarting operations at its Port Arthur, Texas, plant.

Some industry stalwarts were still out of commission though. ConocoPhillips closed its Houston headquarters through Sept. 11. BP’s Houston campus suffered severe flooding and remained closed. Portions may be out of use until December, Chief Executive Bob Dudley told Reuters. About 650 of BP’s more than 5,000 Houston area full-time staff reported damage to their homes.

“I’ve got to get work done but I don’t think it’ll be a productive day,” said Daniel Semetko, 60, a Houston energy company worker, citing the number of people who were out of their homes due to storm damage.

With extensive property damage across the region, local and federal prosecutors formed a task force to investigate reports of home repair fraud and people posing as police to facilitate theft and other crimes, officials said. About 80 investigations into complaints were underway, said David Green, a Department of Homeland Security special agent.

Houston’s school district, the nation’s seventh largest, remains closed this week to repair flooded schools. The district has said about 75 of its 275 schools suffered major or extensive flood damage, but other school districts in the area and major universities were open for class.

IRMA AT CATEGORY 5

As Houston picked up the pieces from the devastation of Harvey, a new and even more powerful hurricane was headed for the Caribbean islands, the U.S. East Coast and Florida.

The U.S. National Hurricane Center said Irma, which it upgraded to a “potentially catastrophic” Category 5 storm, was about 130 miles (210 km) east of Antigua on Tuesday afternoon. Hurricane warnings were issued for Puerto Rico, Antigua, Montserrat, St. Eustatius, the British Virgin Islands and the U.S. Virgin Islands.

Port operations along the Texas coast that service the area’s oil and gas companies returned to work. At the last three of 28 Texas coast ports still closed to ship traffic, the U.S. Coast Guard said it was monitoring water currents for when shipping might resume.

U.S. gasoline prices fell on Tuesday as traders priced in a continued restart of flooded Gulf Coast refineries. Benchmark U.S. gasoline futures were lower by about 4 percent, returning to levels last seen before Harvey made landfall.

(Reporting by Ernest Scheyder, Catherine Ngai and Ron Bousso; Editing by Bill Trott and Tom Brown)

Texas edges closer to recovery after Harvey as key pipeline restarts

Samaritans help clear debris from the house of a neighbor which was left flooded from Tropical Storm Harvey in Houston, Texas, U.S. September 3, 2017.

By Catherine Ngai

HOUSTON (Reuters) – The U.S. Gulf Coast moves closer to recovery from Hurricane Harvey on Monday when the biggest American fuel system restarts a key segment shut down by devastating rains and officials weigh how to pay for billions of dollars in damage.

The move by Colonial Pipeline to resume transporting distillates such as diesel fuel comes as the Gulf region’s energy industry starts to come back online.

Flooding from Harvey drove up fuel prices by shutting down almost a quarter of U.S. refining capacity.

The storm came ashore on Aug. 25 as the most powerful hurricane to hit Texas in more than 50 years. It killed an estimated 50 people, displaced more than 1 million and damaged some 200,000 homes in a path of destruction stretching for more than 300 miles (480 km).

Colonial said it expected to reopen a Texas section of its network from Houston to Hebert, Texas, on Monday, which is the Labor Day holiday. The line would be ready to start moving gasoline on Tuesday, it said.

The pipelines’ reopening will restore links between refineries along the Gulf Coast, the U.S. petrochemical hub, to markets in the Northeast.

Another fuel system, Explorer Pipeline, said a link running from Texas to Oklahoma restarted on Sunday, with a second pipeline from Oklahoma into the Midwest expected to resume on Monday.

Retail fuel costs surged through the weekend amid fears of shortages, despite the restart of several key Gulf refineries that had been crippled by Harvey.

Treasury Secretary Steven Mnuchin challenged Congress on Sunday to raise the government’s debt limit in order to free up relief spending. Texas Governor Greg Abbott said the storm had caused up to $180 billion in damage.

President Donald Trump’s administration has asked Congress for an initial $7.85 billion for recovery efforts, a small fraction of what will eventually be needed.

Even that amount could be delayed unless Congress quickly increases the government’s debt ceiling, Mnuchin said. The United States is on track to hit its mandated borrowing limit by the end of the month unless Congress increases it.

Houston Mayor Sylvester Turner said the city expected most public services and businesses to be restored by Tuesday, the first day after the Labor Day holiday.

About 37,000 families were staying in 270 shelters in Texas, the highest number reported by the American Red Cross.

The city mandated the evacuation of thousands of people on the western side of Houston on Sunday to accommodate the release of water from reservoirs that otherwise might sustain damage. The storm stalled over Houston, the fourth-largest U.S. city, dumping more than 50 inches (1.3 m) on the region.

 

(Reporting by Catherine Ngai in HOUSTON and Ian Simpson in WASHINGTON; Editing by Paul Tait)