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Obama seeks $60.4 billion for Sandy repairs, states want more

The debris of a home damaged by Superstorm Sandy is seen one month after the disaster at the zone of Union Beach in New Jersey November 29,
The debris of a home damaged by Superstorm Sandy is seen one month after the disaster at the zone of Union Beach in New Jersey November 29,

By Hilary Russ and David Lawder

NEW YORK/WASHINGTON (Reuters) - President Barack Obama asked Congress on Friday to approve a $60.4 billion aid package to help East Coast states rebuild after Superstorm Sandy, well short of their initial requests.

Officials from storm-battered New York, New Jersey and Connecticut had said they needed at least $82 billion combined to make emergency repairs and upgrade infrastructure.

New York and New Jersey lawmakers said they expect Obama will seek more aid as the extent of Sandy's damage becomes clearer. The two states were hit the hardest by the storm, which made landfall in New Jersey on October 29.

"This supplemental is a very good start, and while $60 billion doesn't cover all of New York and New Jersey's needs, it covers a large percentage," said Senators Charles Schumer and Kirsten Gillibrand of New York and Frank Lautenberg and Robert Menendez of New Jersey.

"This is the first good news New York has had in a while," New York Governor Andrew Cuomo said.

Of the total, $15 billion would come in the form of Community Development Block Grants, a mechanism that gives local jurisdiction significant flexibility to provide aid and rebuild quickly.

In addition, nearly $13 billion would go to an array of projects aimed at better protecting the New York-New Jersey coastal region and preventing damage from future storms.

Another $6.2 billion would be reserved for public transportation infrastructure.

Officials said they could ask for more aid later on. There is precedent for multiple funding requests to cope with a disaster.

Less than two weeks after Hurricane Katrina slammed into the Gulf Coast in 2005, Congress had passed two appropriations totaling $62.3 billion. Within a year, two more packages were passed worth a combined $48 billion, which also covered damage from Hurricanes Rita and Wilma.

Multibillion-dollar supplemental appropriations for Katrina were still being made as late as 2010.

COULD COMPLICATE 'CLIFF' TALKS

The disaster funding request, on a scale not seen since Katrina, could complicate already tense negotiations between the White House and Congress on a deficit reduction deal.

Lawmakers are trying to avert the year-end "fiscal cliff" of automatic tax hikes and spending cuts that amount to a total of $600 billion.

"We have the request and will review it," said Michael Steel, a spokesman for House of Representatives Speaker John Boehner. He did not elaborate.

Some Republican lawmakers have said they will demand spending cuts elsewhere in the federal budget to offset the cost of some projects in the aid package.

House Appropriations Committee Chairman Hal Rogers, whose panel will review the request, said Congress has a responsibility to help the region recover.

"It is also our responsibility during these tight-budget times to make sure that the victims of this storm are getting the most of every single recovery dollar, and to ensure that disaster funds are timed and targeted in the most efficient and appropriate manner," the Republican lawmaker said in a statement.

Menendez said on Thursday that he expects that Congress will be able to approve the spending request before the end of the year.

Federal Emergency Management Agency chief Craig Fugate told lawmakers this week that the FEMA disaster relief fund was down to less than $5 billion and would run out by early spring at the current pace of disbursements.

"We need a full recovery package to be voted on in this session of Congress," said New York City Mayor Michael Bloomberg in a statement. "Any delay will impede our recovery."

(Reporting by Hilary Russ and David Lawder; Editing By Tiziana Barghini and Xavier Briand)

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