Hurricane Katrina destroyed much of the city of New Orleans in 2005. The storm caused levees to fail, releasing tens of billions of gallons of water. The levee failure contributed to extensive flooding in New Orleans area and surrounding parishes. 80% of all structures in Orleans Parish sustained water damage. Over 204,000 homes were damaged or destroyed, and more than 800,000 citizens displaced — the greatest displacement in the United States since the Dust Bowl of the 1930s. Wind damage was less severe than predicted.
Reconstruction was hindered by bureaucratic problems and funding issues with the U.S. Army Corps of Engineers and the Federal Emergency Management Agency (FEMA). Relief agencies provided supplemental relief. By mid-June 2006, the city was again hosting conventions and promoting tourism.
By Monday, September 5, 2005 power began to be restored to buildings in the central business district of New Orleans on a priority basis. By Tuesday, September 6, 2005 the Port of New Orleans, the biggest U.S. port in terms of tonnage handled, was able to receive and service relief ships. It was estimated that resumption of commercial shipments would take at least 14 days.
The Corps of Engineers repaired the 55 levee breaches including the Industrial Canal, 17th Street Canal, and London Avenue Canal since shortly after the storm, and continues to work on mitigating the risk posed by flooding.
Testing found the flood waters were not unusual. The Louisiana Department of Environmental Quality and the U.S. Environmental Protection Agency (EPA) in March 2006 declared all parts of New Orleans safe; no soil was contaminated and the air quality was pure.