WASHINGTON - In another potential crisis for hurricane-ravaged New Orleans, city officials say the local power company is so financially strapped that it may have to raise rates by 140% unless it gets a $500 million federal bailout - a move the White House opposes.

The plight of Entergy New Orleans, the city's provider of electricity and natural gas, "couldn't be more urgent," says Clint Vince, a Washington lawyer who is advising New Orleans on utility matters. He says the company could run out of money by February. "It's crucial that we get federal help."

New Orleans Mayor Ray Nagin has been lobbying members of Congress on the issue during trips to Washington this month. "This is a really serious issue," Nagin said during a town meeting for displaced residents in Baton Rouge earlier this month.

Entergy New Orleans filed for Chapter 11 bankruptcy on Sept. 23, citing a loss of revenue because of damage from Hurricane Katrina. The company says costs to restore service could top $260 million.

Kurt Hebert, executive vice president of parent company Entergy Corp., says the New Orleans utility has regained only 24% - slightly more than 45,000 - of its 190,000 customers.

Entergy Corp. has loaned the New Orleans utility about $250 million to keep it afloat. But Hebert says that the parent company has a limit to its resources, and that the rate increase to cover the storm-related losses is not realistic.

"It would be a backbreaker for people who have already lost everything," Hebert says.

Another unpleasant scenario raised by New Orleans lobbyists has the city taking over Entergy New Orleans - an unlikely possibility given the drastic loss in tax revenue after Katrina and the city's lack of financial resources.

"We already have enough on our plate," says New Orleans City Councilman Eddie Sapir, who was in Washington last week to lobby.

Entergy New Orleans had hoped to get money through a request by President Bush last month for Congress to shift $17.1 billion in funds already authorized for disaster relief to Katrina recovery.

"For some reason, it was not included," Hebert says. "And no, I don't know why."

The administration's view: Federal aid for damage incurred in natural disasters rarely goes to for-profit companies such as utilities.

Entergy Corp. is the nation's fourth-largest power company. It has annual revenue of more than $10 billion.

"The recent funding request &ellipsis; contained no funding for private, for-profit companies," says Scott Milburn, a spokesman for the White House Office of Management and Budget. He says taxpayer-funded relief "is typically provided to those who have no other place to turn."

Sapir expressed hope that Senate Appropriations Committee Chairman Thad Cochran, R-Miss., will intervene, possibly with a proposal that would use Community Development Block Grants. The grants were used to help New York utility Consolidated Edison after the Sept. 11 terrorist attacks.

Cochran spokeswoman Jenny Manley says the senator is considering a proposal to increase overall funding for the grants, which he believes could be used for Entergy New Orleans.

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