Inspections of roughly 128,000 homes on New Orleans' east bank of the Mississippi River are complete, and demolition of 2,500 of those homes, wrecked by Hurricane Katrina's waters and winds, will begin in the next few weeks, city officials said.

Overall, 5,534 houses, or about 4 percent of the total, were marked with red stickers as being unsafe to enter and must be razed, said Greg Meffert, the city's chief technology officer, who also oversees the city's department of safety and permits.

But only the buildings that pose an imminent public hazard - which number about 2,500 - will be demolished immediately. The remaining 3,000, which Meffert said are not considered an immediate threat and will be inspected a second time to verify they must be torn down.

In the meantime, he said, city officials are trying to locate homeowners to alert them in case they want to remove any belongings before the demolitions start.

But there may be a question of whether the demolitions will ever begin.

A coalition of individuals and groups announced Saturday that they're preparing to file a lawsuit to block the city from bulldozing people's homes without first following legal due process procedures.

"The City of New Orleans knows full well that they are bound by the Constitutions of the United States and the State of Louisiana," said Loyola Law School Professor Bill Quigley. "Both constitutions require real prior notice and a meaningful opportunity to be heard before the government can take or destroy anyone's property."

Because of the Christmas holiday, the lawsuit likely won't be filed until sometime next week, said Quigley, who, along with the Advancement Project of Washington, D.C., and the Peoples Hurricane Relief Fund are seeking to protect residents' rights.

"It is now nearly four months after the damage - no emergency exists that would allow the City to trample the constitutional rights of property owners without due process," he said. "It is particularly shameful that the City of New Orleans would use the eve of Christmas to announce their illegal intentions to destroy people's homes without due process of law."

Meanwhile, Meffert said the planned demolitions will be overseen and paid for by the Army Corps of Engineers.

The vast majority of the city's homes - about 68 percent - were coded yellow, or judged to be sound but with structural damage. And Meffert said it's unlikely that as many as half of those homes, or about 43,000, will eventually be demolished.

But city officials hope to leave that decision in the hands of the homeowners as much as possible, he said.

Not surprisingly, the Lower 9th Ward, where a wide and sudden breach of the Industrial Canal allowed waters to rush in, pulling hundreds of homes off their foundations, had the largest concentration of red-tagged homes. A small section of Gentilly, in a low-lying area off Elysian Fields Avenue, also figures to be a hub of demolition.

The red tags are mostly absent from the city's historic districts, although there are exceptions. In particular, there is a cluster of buildings marked for demolition in the Holy Cross neighborhood of the Lower 9th Ward.

Most of the inspections were performed by subcontractors to The Shaw Group of Baton Rouge, which won a contract to oversee the work. All homes were given color codes but only those in danger of collapse earned the red stickers. Homes coded yellow typically had some structural damage but were judged sound, while those coded green had little or no damage.

City inspectors were deliberately "conservative" in tagging homes, Meffert said. He has not received a single complaint suggesting that a red-tagged house should not be torn down, he said.

"If he hasn't heard anything it's because the city stated unequivocally in the past that red tags did not signify impending demolition," said Meg Lousteau, director of the Louisiana Landmarks Society. "If that has changed, they need to make that very clear. Owners of these buildings need to be made aware so they can plead their case of make repairs."

The color codes hint at another key figure calculated by the inspectors - the percentage of each home deemed to be damaged. For homeowners considering their rebuilding options, the number is extremely important if the home is located below the base flood elevation on current Federal Emergency Management Agency maps.

Under the "50 percent rule," if the home is below that elevation and inspectors judge that it will cost more than 50 percent of a home's worth to restore it, the homeowner must raise the floor elevation to at least the base flood elevation before renovating. FEMA has a grant program that helps defray the cost of jacking up houses.

If the inspector judges the cost to be less than 50 percent, the homeowner may renovate without raising his house. But there's a catch there, too: if the homeowner in that predicament wants to raise his house, he is not eligible for the FEMA grant program.

The percentage of damage is calculated based on the height of floodwaters, using a formula devised by the federal government, which administers the flood insurance program. The formula assigns various values to the home's various parts, among them its roof, superstructure, walls, electrical system and plumbing.

Thousands of the houses coded yellow are near the 50 percent threshold, Meffert said, and many homeowners wish they were on the other side of the threshold than the one assigned by inspectors.

They are free to appeal, and in most cases, when they do, city officials are trying to give them what they want, Meffert said.

"If it's a 'gray zone' call, virtually 100 percent of the time, we're going to go in the direction of where the resident wants us to go," he said.

Meffert said that people appealing the damage rulings must make a case for why the number should be changed. But it doesn't have to involve construction estimates or other official paperwork, he said. For example, he said, if the inspector said the walls have to be replaced, a homeowner might argue that they're salvageable.

The changes are being made only when a homeowner is within range of 50 percent, he said. "We're not doing this like between 30 and 70," he said. "It's more like between 43 and 57."

Meffert could not say how many damage estimates had been revised. But he said the city has been issuing as many as 200 building permits a day, about six times the typical pre-Katrina volume. And, he estimated that one in four homeowners has sought to appeal their damage estimates.

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Information from: The Times-Picayune