A few things to consider:
1) Despite its name, City Park is a state facitility. It is not owned by the City of New Orleans.
2) There is a golf course and range in operation in the park, managed by Billy Casper Golf. It is very busy.
3) The concept referred to in the original post is all but dead. Currently the plan is to build one additional course, and a par three that would be primarily for juniors and the First Tee program. That is very up in the air due to all the things mentioned in this thread. The Golf Channel's "Golf in America" show featured City PArk and seemed to imply that the second course was underway. But it is not.
4) The motivators for redevelopment of the golf courses were more East Lake than Torrey Pines, in that the vision included redevelopment of urban blight areas near the park, as well as building a permanent home for the New Orleans Open on the PGA Tour. Like Torrey Pines, a private development group proposed the project and to fund it, though it would be a publically owned facility probably managed by a private firm such as Billy Casper. They have been unable, however, to follow through on needed fund raising.
5) How long ago was the last time City Park flooded, at least enough to wipe out the courses? It could flood again tomorrow, if the levy breaks. But the likelihood is that it will be a very long time before that happens..
Now I am no expert on City Park, but the information I have presented comes from a reliable, highly placed source. Personally I hope they can someday build a quality affordable, enjoyable course to complement what is already there.