NEW ORLEANS (Reuters) — More than a year after Hurricane Katrina hit New Orleans, thousands of homes damaged by flooding still stand empty, stained by black mold and some of them infested with maggots.City authorities are now cranking up a $20 million drive to deal with a problem until now addressed mainly by charities, home-owners and contractors who have worked to gut the properties and eliminate the health hazard they pose.

Volunteers from the charity Acorn began the two-day process of gutting one such house belonging to Gwen Brown in New Orleans East suburb in late October, removing damaged goods and stripping the house to its walls, floorboards and ceilings.

They wore white full-body protective suits and put on gas masks, goggles and thick gloves because the spores infested every corner of the house.

“There’s nothing like a maggot-filled refrigerator,” said Daryl Durham, the team leader, as he hauled one into the street to join a growing pile of possessions. The stench from the fridge filled the road.

Flood waters that surged into the famed city of jazz in August last year churned the house contents around like a whirlpool and then sat at a depth of five feet for weeks before receding. Since then the house, like thousands of others, has been left untouched.

Acorn says its volunteers have gutted around 1,600 homes at a rate of around 20 per month and around 2,000 homes remain on its list to be cleared out, though many other residents have signed up with other groups to have their houses dealt with.

“People ... just think it was a city that was demolished. If people realised that these were people’s lives then more things would happen quicker,” said Lauren Pembo, 19, a student volunteer and New Orleans native.

As part of the Good Neighbour Programme, Mayor Ray Nagin proposed $15 million in his $419 million November budget to strip 5,000 homes and $5 million to demolish 10,000 more, said Anthony Faciane, chief of development in the mayor’s office.

The programme, which started a year after the storm, involves a three-step, 120-day process for homeowners who have not cleaned out or demolished damaged homes or applied to a volunteer agency to do the job.

Homeowners are first given notice that they are in violation of local laws, then after 30 days a notice is put on the property and on a Web site and 30 days after that authorities can seek permission to demolish or to gut and board up a property.

“It is crucial that most of our resources have to be given for making a high-quality of life for the pioneers, the people who came back and started to rebuild. We need to clean neighbourhoods up,” Faciane told Reuters.

Around 120,000 properties were damaged by flooding in New Orleans. Permits had been issued for around 100,000 to be gutted or repaired, leaving around 20,000 untouched.

Of those, around 15,000 would have to be demolished, Faciane said.

Many homeowners, traumatised by their experience of losing so much, were reluctant to make a decision on whether to return and rebuild so the city was setting deadlines to help them decide, he said.

“What people don’t realise is that this was the first time in history is that an entire American city was shut down,” Faciane said.

Volunteers use crowbars to prize sheetrock from walls in damaged homes. But they have to be careful <\m> items that look worthless may be of intense personal value.

For many people, seeing the contents of their flooded houses piled up in the street is traumatic.

Brown, whose New Orleans East home yielded the maggot-infested fridge and who fled to Houston, Texas, just before the storm, maintained telephone contact with the team clearing her single-story home and the next day returned to see it.

“This was my first place. I was so happy here. I would sit on this patio after work,” said Brown, 51, as she picked through old records, carpets, plastic flowers and other items.

A neighbour who failed to get out before the storm drowned in her back yard. The body was removed in the immediate aftermath of the storm, she said.

Almost every item she found triggered memories. A framed print of jazz singer Billie Holliday had survived as had a bottle stuffed with coins her daughter used as a piggy bank.

Insurance money she received went to pay off the mortgage and she planned, one day, to rebuild the house and move back.

But Brown was unsentimental about her ruined possessions and marvelled how much “junk” she’d accumulated over the years.

“It’s a closure because this part of our life is over,” she said as she surveyed her stuff. “We loved this house but I can’t get none of it back.”