Then and Now: New Orleans after Hurricane Katrina

'A WHOLE NEW LIFE'

Just months after Hurricane Katrina blew the roof off Margaret Smith's Uptown house in August 2005, volunteers rushed to New Orleans to help rebuild. "I was a needle in a haystack in New Orleans," she tells PEOPLE, "and across America people came here and changed my life." Smith, 54, now operates a specialty collectibles shop in the front room of her refurbished home (pictured). "Everything is new again," she says. "Thank you America for giving me a whole new life."

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'I LOST EVERTHING'

Four years ago when the storm split her house in two, Smith was forced to leave New Orleans. "I lost everything," Smith says. "I had nothing left. I didn't think it could get any worse." But when she returned to the city several weeks later, it did: She lost her school board job and mounds of "trash" – actually her precious belongings, destroyed by wind and water – were taken out into the street to be thrown away.

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BUSINESS IN TATTERS

When Mike Salem, 31, returned to his Canal Street store American Fashions (photographed here in Nov. 2005) days after Katrina, it was flooded with over 2 ft. of water – and looting was heavy. "I felt disgusted," says Salem, a lifelong New Orleans resident. "It was very, very bad with garbage and wet clothes everywhere."

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ALL IN THE FAMILY

With the help of his extended family, wife Reem (not pictured) and his children – (from left) Hadi, 4, Hadeel, 11, Mohammad, 9, and Mahdi, 5 – Salem cleaned up and began rebuilding only a month after the storm. By Nov. 15, American Fashions was open in time for the Mardi Gras season, though business to this day hasn't bounced back entirely, he tells PEOPLE. "I look around and I'd say New Orleans is only back about 20 percent," he says. "We need everyone back."

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HORRIFIC SCENE

After plowing his 18-wheeler through rising floodwater, Chester Lastie, 44, found himself stuck on the Claiborne Bridge in the Lower Ninth Ward with his family amid a landscape of tragedy. The diesel mechanic pulled to safety a woman and her daughter who had become wedged between the bridge and an uprooted house floating in raging waters just as the house splintered into pieces. "I was lucky to hear them," he says. "There was screaming everywhere."

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HOPE LIVES

Now, Lastie is living in his father's home and restoring one room at a time. He hopes to have it ready soon so his fiancée Lisa Daniels, 41, and her two daughters, Sierra, 14, and Jade, 13, (not pictured) can move in. "You can have New Orleans back, but you've got to want it bad," he says. "New Orleans is my family. I have happiness here. I have hope."

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ECHOES OF THE STORM

In the post-Katrina chaos, Mark Morice, 39, found a boat and began to rescue neighbors after hearing their heartrending pleas. "Screams echoed out over the water," he tells PEOPLE. "You can't ever forget." So Morice grabbed as many people as he could, including his 93-year-old neighbor, a pregnant woman and families with children, and gave them tasks on the boat to calm them – looking out for cars under the water or trees and limbs that would impede their journey. "People were in shock," he says of the scene.

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'SPIRIT FOR LIFE'

In the chaos of the storm, Morice answered a friend’s plea to check on his father. Morice found the man’s lifeless body in the attic of the family’s home. Fortunately, he was able to help others to survive. Now he is back in his renovated home – and he is hopeful. "We have many tasks at hand in New Orleans," he says, "but our spirit for life and laissez les bon temps roulez attitude will get us through."

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SCHOOLHOUSE ROCKED

Elementary school principal Rose Smith, 57, worried about her students, her staff and her school in the chaos after the storm. When she was finally able to visit historic Brock Elementary in Slidell, La., and saw the waterline had risen to 8 ft. in places, "I was shocked," she says. "I didn't know how we'd open."

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SPARKLING CLEAN

But with the community rallying around the landmark school – and with $9 million in federal rebuilding funds – a sparkling clean, fully equipped Brock Elementary welcomed students on December 9, 2008. This school year, classes are just 16 students shy of post-Katrina numbers. "When we came back and I saw the smiles on the kids' faces, I knew everything would be okay," Smith tells PEOPLE.

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A CHRISTMAS GIFT

Christmas 2005 was a tough one for then 5-year-old Alixandra Licciardi of St. Bernard Parish, who was living in a tiny FEMA trailer with her father, Charlie, mom Andrea and little sister, Abigale, then 4. But she got a skateboard for the holiday – and her parents even showed her the trailer hatch at the top of the ceiling that Santa had used in place of a chimney.

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STILL RIDING

Almost four years later, Alix has a new house and a new skateboard. "It's different riding my skateboard in my neighborhood now," says Alix, 10, who just started school and loves math. "It's easier, that's for sure." Her dad echoes the sentiment. "I feel fortunate," he tells PEOPLE. "I worry less during hurricane season because we lost everything before. We know we don't need any of it when we have each other."