New Orleans kicked off a low-key holiday season on Tuesday with a handout of 500 free Christmas trees, some to people who lost their homes in Hurricane Katrina three months ago.

But many residents who stood in a line that stretched for more than two blocks down central Canal Street said that Christmas cheer would be hard to come by this year.

"It's going to be kind of depressing," said John Ellison, who is living in a neighboring parish while his flood-damaged home is repaired and power restored.

"We're waiting for lights. We bought reindeer to put on the roof at an after-Christmas sale last year, and now we can't use them."

Katrina waylaid some of New Orleans' traditional holiday celebrations. A drive-through light display in City Park was canceled after the hurricane ripped through the centuries-old oaks. And decorations that normally hang along the Canal Street streetcar line were destroyed by the flooding.

The holiday display was downgraded to a decorated 20-foot (6-metre) tree and illuminated garlands across a second-floor hotel balcony.

Mayor Ray Nagin said the dozens of children waiting in line for trees were a sign that New Orleans was coming back to life. "The thing that I missed the most about New Orleans is the thing that I see now. I see kids," he said.

Donald Powell, the federal official overseeing the Gulf Coast's reconstruction, earlier toured some of neighborhoods most devastated when the city's levee system failed.

But he would not commit to the Christmas present Louisiana officials would most like -- a pledge to use federal money to build a flood protection system that would withstand a Katrina-strength storm.

The trees were donated by an Oregon grower.

Jo Day, an artist who sells her work in the French Quarter, is living with her adult daughter in a camper outside the apartment building they occupied before Katrina.

"I had to have a Douglas fir," said Day, who arrived a couple of hours early to snag a spot near the front of the line. "They smell so good."