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Area hotels wonder if claims from BP oil spill will be paid

Top BP executives stepped out of a White House meeting last month promising to pay all legitimate claims for damages caused by oil gushing from its well in the gulf.

The pledge sounds simple enough. But some Pinellas beach businesses say uncertainty about ground rules for dispersing the $20 billion fund has them worried they may not be fully compensated for their losses.

One major concern is the incoming boss of the Gulf Coast Claims Fund. Kenneth Feinberg won acclaim overseeing the U.S. government's compensation fund for victims of the Sept. 11 terrorist attacks. He will take over operations of BP's Gulf Coast Claims Center next month.

The Washington, D.C., attorney and law professor drew fire over testimony before the U.S. House Committee on Small Business last month. Feinberg said he would use Florida law as one standard to determine eligibility.

Asked whether the BP money could pay for claims in areas where no oil washed up on beaches, he called it a "tough'' issue.

"Clearly under Florida law … if there's no physical damage to the beaches and it's a public perception, I venture to say that is not compensable,'' Feinberg said. He added, "that's in this area where some discretion's going to have to be exercised.''

Plenty of other tough calls await, including the compensation of real estate brokers who lose commissions and rentals. Keith Overton, chief operating officer of the TradeWinds Island Resorts on St. Pete Beach, asked about compensating suppliers, ranging from food wholesalers to pest control companies, for hotels who were scaling back orders.

Floridians and businesses in the state have filed 32,400 claims, and BP has paid $43.8 million so far, the company says. About 80 percent of the money went toward claims in 10 Panhandle counties. The biggest chunk — 42 percent — covered lost wages.

In Tampa Bay, BP paid more than $2 million. Checks totaling $852,000 went to addresses in Pinellas, $425,000 in Hillsborough, $547,000 in Pasco and $224,000 in Hernando. Claim numbers for the area were not available Friday, the company said.

In Madeira Beach, the Friendly Fisherman Restaurant's claim is about to enter the system, said chief financial officer Patty Hubbard. The paperwork includes monthly profit and loss statements for 2008 and 2009 that BP requested.

She's also throwing in financial data for 2007, the last really good year for the restaurant in tourist-dependent John's Pass Village. The recession spoiled 2008 and 2009, she said, while cold weather cut into 2010 tourist numbers until mid March.

BP will use previous years numbers to determine what an average year should look like. Adjusters then will compare those numbers to how well the business has performed since the Horizon Deepwater rig blew in April.

Hubbard said business from March into April was terrific as tourists steamed back to the beaches. Then came the big spill. She said June revenues were off 20 percent from a year earlier. "What we were robbed of was our recovery,'' she says.

Steve Huettel can be reached at [email protected] or (813) 226-3384.

Area hotels wonder if claims from BP oil spill will be paid 07/23/10 [Last modified: Friday, July 23, 2010 8:59pm]
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