(AP) - When it rains in Rushford now, people get nervous.
"Any rain, it just kind of takes the breath out of my chest. It's frightening," Nancy Benson, whose home, business and two cars were destroyed by flooding in late August, said the morning after another round of heavy showers moved through.
People in this small southeastern Minnesota town are on edge these days, frustrated and tired from jumping through bureaucratic hoops to rebuild.
They're also worried about the rapid approach of winter, even as several hundred homes and buildings are still drying out -- lacking furnaces, electrical wiring and, in many cases, four outer walls. For a town still very much on the edge, a few nights of temperatures below freezing could be devastating.
"All that work of mucking them out, cleaning and sanitizing them -- if they're still open to the elements when it gets cold, it will do more damage than the flood ever did," said Laura Deering, a member of the Rushford City Council.
She's worried that many residents still haggling with government agencies over money for rebuilding would simply walk away if their homes take another hit.
"Not to use the term lightly, but this is sort of our Katrina here," Deering said.
Heavy rains on Aug. 18-19 caused flash floods that swept through Rushford and the surrounding region, washing away homes, destroying infrastructure and killing seven people -- though none here.
Of the almost 700 homes and buildings in the town of about 1,700 people, more than half were seriously damaged by the flood, including every building in the downtown business district.
More than six weeks later, most of the town's businesses remain closed, nearly all the damaged homes empty.
Even as the government aid begins to flow, many residents are calculating whether it makes financial sense to stay and rebuild. Older residents face new mortgages. For younger people, it could mean new debt that will follow them for years.
"A lot of the people in this community are retired or close to retired. They can't afford to take a mortgage out again and rebuild," said Wayne Exe, a local gas company employee. "These are the people I really feel for. They're really hurting."
People who want to stay, but don't plan to rebuild, have limited options. The flood damaged two multi-unit senior housing complexes beyond repair, and wiped out a 34-unit mobile home park.
"We're going to have an affordable housing problem on our hands," city administrator Windy Block said.
Those who want to rebuild are also encountering obstacles. While the government aid process seems to mostly be working for those who want to fix up damaged homes, city officials have identified what they believe is a flaw in the process.
"There doesn't seem to be enough help available for people who want to tear down their house and rebuild on the same site. There's people who want to do that but they don't have the wherewithal," Block said.
He estimated about 60 homeowners could be in this situation. One is Terry Hubbard, a truck driver who would like to rebuild on the same lot but so far hasn't landed on an aid formula that would work without plunging him deep into debt when he already has about $68,000 on his current mortgage.
"If they don't give me the money to rebuild, I might just let it sit there and be an eyesore," Hubbard said.
Megan Ryan, spokeswoman for the Minnesota Housing Finance Agency, said that officials there are aware of the problem and are working to address it with a new aid category they hope to have available soon.
Some residents have apparently left for good. The local school district has lost 19 students who had been enrolled for the fall term. Those who've stayed so far are bunking for now with relatives nearby or in one of the 55 FEMA trailers scattered around town.
Roger Corbenson decided to stay, and took advantage of a real estate market full of extreme bargains. The house where Corbenson and his wife lived for 38 years was damaged beyond repair, But the day after the flood he learned that his neighbor down the street wanted out.
"I said what will it take and he said $30,000," Corbenson said. "I said, 'I'll take it.' His attitude was, 'The hell with it, I don't want to go through this again.' I don't blame him."
Corbenson said he thinks it'll take another $70,000 to make his new house livable. He got a $28,000 grant from FEMA, but said he'll have to borrow to cover the rest.
"I'm damn near 67 - why the hell do I want to go back into debt?" he said. "But where else am I going to live? These are our roots."
In the town's small business community, owners mulling whether to re-open are considering the possibility of a shrunken customer base. Meanwhile, their businesses have been closed well into a second month now and "the bills keep coming," said Jim Hoiness, owner of Rushford Foods.
Hoiness is among the few local owners who have committed to re-open, but admitted that might not have been possible if he didn't own two other grocery stores in the region.
"We have to be hopeful that our community can come back to almost what it was before the flood," said Hoiness, whose house was also badly damaged. "We know it may be a couple years before it's known. There are a lot of unknowns."
(Copyright 2007 by The Associated Press. All Rights Reserved.)
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