Sept. 1 (Bloomberg) -- U.S. President George W. Bush will ask Congress to approve $10.5 billion in emergency spending to help pay for cleanup costs associated with Hurricane Katrina, Republicans familiar with the plan said.

Bush may send his proposal to Congress as early as Friday as lawmakers cut short their recess and return to Washington, the officials said. Earlier, Bush waived funding rules to let the federal government pay 100 percent of the costs for debris removal and other emergency operations for 60 days. Under regular circumstances state and local governments pay 25 percent of the costs.

The officials, who spoke on condition of anonymity because they are not authorized to speak with the press, said $10 billion would go to the Federal Emergency Management Agency, which is leading the emergency response to the hurricane, and $500 million would be for the Defense Department, which also is participating in the recovery.

New York Democratic Senator Charles Schumer said Congress would vote on the disaster relief within 24 hours. ``We will do everything we can to make sure that New Orleans and the rest of the Gulf region gets the funds and support to recover and rebuild,'' Schumer said in a statement.

The Senate will return tonight and the House will reconvene tomorrow to pass the aid, House Speaker Dennis Hastert and Senate Majority Bill Frist said in a joint statement. Lawmakers were initially slated to return to work next week from an August break.

Bush Visit

Bush, who will tour areas of Alabama, Mississippi and Louisiana affected by the hurricane tomorrow, also appointed former President Bill Clinton and his father, former President George H.W. Bush, to lead a nationwide fund-raising effort.

``The former presidents will ask Americans to open their hearts, and their wallets, to those in need,'' Bush said in an Oval Office speech with both former presidents at his side. ``I am confident the American people will respond.''

U.S. Homeland Security Secretary Michael Chertoff said today the federal government has committed to spend $2 billion on emergency aid so far. Katrina swept over Louisiana, Mississippi, Alabama and western Florida three days ago with 140-mile-an-hour winds.

The storm caused an estimated $25 billion in damage, which would make it the costliest U.S. natural disaster. It killed an untold number of people and destroyed commerce along the Gulf Coast region, which produces a third of the nation's oil, a fifth of its natural gas and handles 40 percent of U.S. grain exports.

Energy Supply

Bush today said the hurricane caused a significant disruption of U.S. energy supplies, though the effect will be only temporary. He met with Federal Reserve Chairman Alan Greenspan and his economic advisers to assess the economic impact of the hurricane. More than 90,000 square miles of territory in Louisiana, Mississippi and Alabama have been declared a disaster area.

``We spent a lot of time talking about the damage done to our energy infrastructure,'' Bush said of his meetings with Greenspan and his advisers. ``We view this storm as a temporary disruption that is being addressed by the government and the private sector.''

About 10 percent of U.S. refining capacity was knocked out by the hurricane and retail gasoline prices have topped $3 a gallon in many areas. The administration already has announced it will release some oil from the Strategic Petroleum Reserve and waive rules on gasoline formulation to increase supplies. Bush also said he was relaxing rules on using foreign ships to deliver oil and gas in the U.S. because of pipeline disruptions.

Pipeline

He said Colonial Pipeline Co., which runs the world's biggest network of petroleum-product pipelines, is ``back in operation but only at 50 percent capacity.''

Alpharetta, Georgia-based Colonial had shut two fuel pipelines after Hurricane Katrina cut power in Mississippi and Louisiana. The lines haul fuel from Houston to North Carolina. Colonial said it was working to restore the pipelines this weekend using diesel generators.

Bush said the government is working with major oil companies to ``get with Colonial Pipeline'' so they can get refined fuel to consumers.

Addressing the public, Bush said, ``don't buy gas if you don't need it.''

`Comprehensive Strategy'

The government has a ``comprehensive'' strategy to help the region recover, with the first priority being rescuing those still stranded, Bush said.

The early Congressional session was prompted by the administration's request for funds for the FEMA, which needed money ``sooner than the next regularly scheduled session'' of Congress on Sept. 6, according to the statement from Hastert and Frist.

Emergency disaster relief will be passed by unanimous consent, not a roll call vote, so Congress can act without waiting for all lawmakers to return to Washington, the statement said. It didn't say how much aid would be approved.

``The House will pass an emergency supplemental bill tomorrow; the bill will be immediately sent to the Senate, passed and be available for the president's signature,'' the statement said.

To contact the reporter on this story: Richard Keil in Washington at dkeil@bloomberg.net; Roger Runningen in Washington at rrunningen@bloomberg.net

Last Updated: September 1, 2005 16:46 EDT