Update. Last night Mr. AE found one of his old, expired passports that wasn't in the safe and is therefore undamaged. With that he will be able to get a new passport.
Mugshots done this morning, off to apply for our replacements at post office tomorrow morning. Extra fee because they're "damaged", plus $60 each for expedited service. Hurricane Sandy still costing us $$$$$$$.
tmnyc, thanks for the info on the passport card, will get those too, just in case.
Very relieved, especially after we found out that it costs $345 to get a replacement Naturalization Certificate.
Moderator can close, thanks to posters for all the information and help!!!!