While BP expects to permanently plug its damaged gulf well within days, the claims process still needs to be opened up. BP's claim adjuster is telling tourist-related businesses in the Tampa Bay region to essentially forget about compensation since no oil has physically washed ashore. Fortunately, the claims process is being turned over to Kenneth Feinberg, an experienced hand at awarding compensation who has said he will be generous in defining what is a reimbursable claim. He has to quickly make good on the pledge, because some area businesses are running out of time.
The Tampa Bay Beaches Chamber of Commerce says its members are hurting after a bust of a spring and summer in which tourists steered clear due to fears that oil would wash ashore from the Deepwater Horizon disaster. The TradeWinds Island Resorts on St. Pete Beach has laid off more than 100 people, according to chief operating officer Keith Overton, because business has fallen off so sharply. But so far area tourist and seafood businesses are reporting they are getting nowhere with ESIS, BP's claims processor, even though they can document substantial losses.
Feinberg, the former 9/11 fund administrator, says he will fire ESIS and hire two other companies to assist his operations, a good sign that he is starting afresh. He says he hopes to begin writing checks within a month. But it still isn't clear exactly what criteria will be used to determine compensation eligibility. Speaking in Alabama recently, Feinberg said businesses that lost revenue due to the perception that the beaches were harmed even if no oil washed ashore should expect only partial recompense, anywhere from 10 percent to 50 percent of losses. That's a big range that could spell the difference between mom-and-pop businesses surviving or closing down, and it appears to be back-peddling from prior statements.
When Feinberg met with oil-affected residents and Gov. Charlie Crist in Pensacola Beach last month, he indicated a more liberal approach to provable claims from places where oil didn't reach. "We will do everything we can to be claimant-friendly," Feinberg said.
That's a promise he needs to keep.