The Gulf Coast Claims Facility, which draws on $20 billion set aside by the London-based oil company after the spill, has received more than 947,000 claims from 50 states and 36 nations, according to a summary released today by claims administrator Kenneth Feinberg.
“Overall, we’ve largely succeeded in getting money out to eligible claimants,” Feinberg said on a conference call with reporters.
In total, about $6.7 billion has been drawn from the fund, which also pays for clean-up costs and restoration projects through payments provided to local governments, Feinberg said.
Feinberg, a Washington lawyer who ran a fund to compensate victims and families of the Sept. 11 terrorist attacks, released the report as the Gulf claims facility marked the first anniversary of accepting applications for compensation.
His firm, Feinberg Rozen LLP, is being paid $1.25 million a month by BP to run the facility and has drawn complaints from Gulf Coast residents and policymakers who said payments have come too slowly and in smaller amounts than sought.
“The only success Mr. Feinberg has had is in coercing desperate victims of the spill to have to accept whatever was offered,” Mississippi Attorney General Jim Hood said in a statement about the $5,421 paid to state businesses and $5,297 to individuals. “It looks like he did a good job for BP, not for Mississippians.”
‘Mixed Bag’
Tony Kennon, mayor of Orange Beach, Alabama, said the claims process was a “mixed bag” for residents in the coastal community who in many cases were left waiting for months for compensation.
“For the most part, folks aren’t necessarily happy with the amount, but are happy to be out of the process and ready to move on,” he said in an interview.
Kennon credited Feinberg for shifting “his philosophy more in a direction we thought was fair” regarding the types of claims eligible for compensation.
Claimants have been paid with emergency checks to cover short-term losses of up to six months and through interim payments that victims can seek periodically. Neither type requires claimants to waive their right to sue BP or other companies involved in the spill.
BP Lawsuits
Only in accepting final payments do spill victims forgo a court remedy. BP faces more than 350 lawsuits by thousands of property owners, fishing interests and tourism businesses claiming harm from the spill linked to the explosion and sinking of the Deepwater Horizon rig.
Feinberg said about $3 billion of the $5 billion paid so far didn’t require businesses or individuals to waive their legal rights.
About 125,000 individuals and businesses seeking payment have been denied because they didn’t prove the losses were tied to the spill, Feinberg said.
More than 2,200 claims have been sent to the U.S. Justice Department as possible fraud, Feinberg said.
Residents and businesses in Florida received about $2.02 billion, or 40 percent of the total. Louisiana collected the second-highest total, about $1.52 billion, or about 30 percent, followed by Alabama and Mississippi, according to the summary.
97% Reviewed
Responding to critics who’ve said the process wasn’t compensating victims quickly enough, Feinberg said about 97 percent of the claims submitted have been reviewed.
People and businesses have until August 2013 to apply to the claims facility for compensation. Facing criticism the process wasn’t transparent, Feinberg agreed in July to an independent audit after a meeting with U.S. Attorney General Eric Holder.
BP has said the Gulf Coast economy has improved so much that most payments for projected damage caused by the spill should be stopped. About 4,400 claimants each week still apply to the fund, Feinberg said.
“We have our work cut out for us,” Feinberg said. “We aren’t going anywhere.”