Texas governor says Harvey damage could climb to a staggering $244 billion

US Vice President Mike Pence speaks to the crowd as Texas Governor Greg Abbott (in wheelchair) looks on in front of damaged church in Rockport, Texas, on Aug. 31, 2017.
US Vice President Mike Pence speaks to the crowd as Texas Governor Greg Abbott (in wheelchair) looks on in front of damaged church in Rockport, Texas, on Aug. 31, 2017.PHOTO: BLOOMBERG

HOUSTON (REUTERS) - Texas Governor Greg Abbott on Sunday (Sept 3) estimated damage from Hurricane Harvey at US$150 billion to US$180 billion ($244 billion), calling it more costly than epic hurricanes Katrina or Sandy and fuelling a debate over how to pay for the disaster.

Harvey, which first came ashore on Aug 25 as the most powerful hurricane to hit Texas in 50 years, has killed an estimated 47 people, displaced more than 1 million and damaged nearly 200,000 homes in a path of destruction stretching for more than 480 kms.

Abbott, who is advocating for US government aid for his state's recovery, said the damage would exceed that of Katrina, the storm that devastated New Orleans and surrounding areas in 2005, and Sandy, which overwhelmed New York city and the U.S. Northeast in 2012.

"Katrina caused if I recall more than US$120 billion but when you look at the number of homes and business affected by this I think this will cost well over US$120 billion, probably US$150 to US$180 billion," Abbott told Fox News, adding, "this is far larger than Hurricane Sandy."

The administration of US President Donald Trump has asked Congress for an initial US$7.85 billion for recovery efforts, which Abbott called a "down payment".

Even that amount could be delayed unless Congress quickly increases the government's debt limit, US Treasury Secretary Steven Mnuchin said on Sunday. The United States is on track to hit its mandated debt limit by the end of the month unless Congress increases it.

"Without raising the debt limit, I am not comfortable that we will get money to Texas this month to rebuild," Mnuchin told Fox News.

Beyond the immediate funding, any massive aid package faces budget pressures at a time when Trump is advocating for tax reform or tax cuts, leading some on Capitol Hill to suggest aid may be released in a series of smaller appropriations.

The head of the US Federal Emergency Management Agency (FEMA) called federal aid a "ray of hope" but said state and local officials also needed to do their part.

"They can't depend only on federal emergency management," FEMA Administrator Brook Long told CBS News, declining to offer a figure for how much money the White House would eventually ask from Congress.

Houston was still struggling to recover on Sunday, when the city forced the evacuation of thousands of people on the western side of town who were affected by the release of floodwater that had built up in a reservoir.

The city cut off power to homes on Sunday morning to encourage evacuation of those who had been reluctant to leave their homes.

About 37,000 refugees stayed overnight in 270 shelters in Texas plus another 2,000 in seven Louisiana shelters, the highest number reported so far by the American Red Cross.

Some 84,700 homes and businesses were without power on Sunday, down from a peak of around 300,000, according to the region's major electric companies.

Many areas of Texas were still battling floodwater from swollen rivers that was expected to remain for a week or more. In Beaumont, about 140 km east of Houston, officials were trying to repair a flood-damaged pumping station that caused the city of about 120,000 people to lose drinking water for days.

The storm knocked offline about one-fourth of U.S. oil refinery capacity, much of which is clustered along the Gulf Coast. The disruptions boosted gasoline prices to a two-year high ahead of the long Labour Day holiday weekend.

But Houston Mayor Sylvester Turner said his city was making progress on several fronts, resuming city services and helping get people into housing and out of emergency shelters. "This is a can-do city. We're not going to engage in a pity party," Turner told CBS News.

Trump visited Houston on Saturday to meet evacuees and rescue workers, an opportunity to show an empathetic side after some criticised him for staying clear of the disaster zone during a previous visit on Tuesday. Trump had said he did not want to hamper rescue efforts.

Trump and his wife Melania marked a national day of prayer for hurricane victims on Sunday by attending church services at St Johns Episcopal Church near the White House.