PALO (AP) - Life in Palo is uncomfortable, but the eastern Iowa town is slowly coming back.

Palo was hit hard by last month's flooding - all but 10 of its 423 homes and businesses were flooded and all 950 residents were evacuated for four days.

Children are now riding bicycles. A small group of neighbors who've moved back into their homes circle their lawn chairs for a meal of Red Cross food. The town is eagerly watching the reconstruction progress at the Palo Mini Mart.

Palo remains mostly deserted by day and a ghost town at night. There's a smell of river water and chemicals.

Former Mayor Terry Sanders lost her home a second time. A fire destroyed her home in 2000.

Sanders says the shock is easing. She says people were just like zombies, and now they're "walking a little taller each day."