Waters recede but storm victims suffer in East

PATERSON, N.J./BRATTLEBORO, Vermont (Reuters) - Floodwaters finally started to recede from areas of the northeast devastated by Hurricane Irene but many communities were still under water on Wednesday and relief workers battled cut-off roads and raging rivers to deliver emergency supplies.

The storm battered the East Coast with up to 15 inches of rain on Saturday and Sunday, setting river level records in 10 states, the Geological Survey said.

Wide swathes of New Jersey, upstate New York and Vermont experienced the worst flooding in decades, and while many disaster areas began to see waters recede other rivers had not yet crested, the USGS said.

Some 1.7 million homes and business were still without power after as many as 6.7 million had lost electricity.

With damage in the billions of dollars -- Standard & Poor's estimated the national total at $20 billion, though others have put the number at half that -- homeowners were also battling insurance companies that exclude flood damage coverage.

Adding to the anxiety, the Federal Emergency Management Agency said it had to put long-term projects on hold and focus on rushing immediate relief to battered states because it had only $800 million left in its disaster relief fund.

The White House said President Barack Obama on Sunday planned to visit the hard-hit New Jersey city of Paterson, one of many places where residents and businesses suffered personal and economic catastrophe.

In Little Falls, New Jersey, Sean Mathews could only wait for floodwaters to recede along Williams Street, where he owns a two-story home that was swamped in four to five feet of water.

"I figure I've got about $20,000 in damage," Mathews said, adding that floods typically leave dead rats, snakes and garbage strewn through the house. "I can deal with snakes. But the sewage smell -- the smell."

Mathews, who installs sheet metal for a living, said moving would be nearly impossible after four major floods in five years wrecked property values.

"We think about moving all the time, but how are you going to sell the house?" he said.

Street after street in Little Falls was flooded, and many were nearly abandoned. Police hung signs saying "No scavenging."

New York state alone suffered $1 billion in damage with 600 homes destroyed, six towns inundated and 150 major highways and 140,000 acres of farmland damaged, Governor Andrew Cuomo said.

"Sometimes the bottom line is the bottom line. We need help on the economics," Cuomo said.

Disaster relief has reignited Washington's budget battles, with some Republicans saying additional spending to help these communities should be offset by cuts elsewhere in the budget.

FLOATING REFRIGERATORS

In Paterson, where hundreds of people had to be rescued from the raging floodwaters by boat or truck, the Passaic River reached its highest level since 1903, officials said.

Once an industrial powerhouse, Paterson has since declined in wealth relative to neighboring towns. Many of its factories were powered by the Great Falls of the Passaic River, the second largest waterfall by volume on the East Coast.

From a helicopter overhead, mist could be seen rising at least 200 feet above the waterfall, making it resemble Niagara Falls.

An entire neighborhood upriver was covered by water, drowning at least two schools, three gas stations and much of the city's industrial area, whose chemicals left a visible sheen on the river. Down the debris-strewn river, two bridges were submerged.

Passaic floodwaters were receding on Wednesday, said James Furtak, acting emergency management director of Bergen County. He said towns such as Wallington, population 11,000, were starting to recover, thanks in part to volunteer firefighters who left their own families to help others.

"You had couches floating, refrigerators floating," Furtak said. "It flooded streets that never got flooded before. Some people lost everything. Their lives."

In Vermont, relief teams worked around the clock to repair washed out roads, drop off emergency supplies to stranded residents and restore electricity.

Vermont had four of its National Guard helicopters in the air and borrowed two from Illinois to send in drinking water, food, medical supplies and diapers, officials said.

"We have these things called goat paths around the state that are extremely rough roads but emergency vehicles can now pass along them, but we are urging residents to stay off this very treacherous terrain to leave it free for emergency vehicles," said Mark Bosma, a spokesman for the state's Emergency Management Agency.

In Brattleboro, where the Connecticut River and Whetstone Brook burst their banks on Sunday, people were busy clearing mud from their homes and assessing damage.

"We're pretty focused on cleaning up and glad the brook has gone down," said Ra Van Dyk, a 53-year-old carpenter, on a break from clearing his brookfront home. "Work and everything else is on hold till we get this done."

(Additional reporting by Grant McCool in Millburn, New Jersey, Svea Herbst-Bayliss in Boston, Dave Warner in Philadelphia, Jon Oatis and Selam Gebrekidan in New York and Tabassum Zakaria in Washington; Writing by Daniel Trotta, Editing by Jackie Frank)