WASHINGTON – Gulf Coast lawmakers complained Thursday that the system set up to compensate people and businesses hurt by the BP oil spill has been slow, inconsistent and lacking in transparency.
Alabama Republican Sen. Richard Shelby has met several times with Kenneth Feinberg, who heads the claims facility, and Shelby said the facility “is not acting with appropriate urgency.”
“Like the entire Gulf Coast, Alabama is at a critical juncture,” Shelby said. “Nine months since the oil spill, 57 percent of claims in Alabama remain unpaid. This amounts to 38,604 individual and business claims that have not received one penny in funding. That is a startling statistic.”
Some of the businesses hurt by the disaster are “fairly desperate” to receive compensation for losses, said Sen. Mary Landrieu, D-La., chairwoman of the Senate homeland security subcommittee on disaster recovery.
“The system is not yet working, in my view, as well as it should be,” she said.
Thursday’s hearing was designed to examine how the Gulf Coast Claims Facility, created using $20 billion from BP, is handling claims for economic damages. Landrieu said she plans to hold another hearing in four weeks.
“There are unanswered questions,” she said after the hearing.
Feinberg acknowledged the program has flaws but defended recent efforts to compensate thousands of people and businesses on the Gulf Coast.
“Overall, $3.5 billion has gone out in five months,” Feinberg said after the hearing. “The GCCF is doing something right.”
In the last five weeks, the facility has paid nearly $700 million to 85,000 claimants who opted to receive money through an expedited process that involves a one-time payment and less paperwork, Feinberg said. He also said more local people have been hired to work in claims offices.
Feinberg said the facility will post information on Feb. 2 explaining the criteria and methodology used to calculate final claims payments. There will be a two-week period for public comment.
Democratic Sen. Bill Nelson of Florida called the move a “step in the right direction.” But he said businesses, particularly in the tourism industry, continue to complain about slow payments and are suffering financially.
“Our people are frustrated,” he said.
Louisiana Republican Sen. David Vitter said most paid claims involved cases that were resolved easily, and many Gulf residents, particularly fishermen, are still waiting for payment.
Vitter said he’s concerned most claims “are not the low-hanging fruit, and (are) people who are waiting and in dire straits.”
Lori West, chairman of the South Mississippi Voluntary Organizations Active in Disasters, a coalition of social service groups, said BP hasn’t done enough to finance social services, including housing and mental health needs.
West said local groups plan to meet with officials from the Gulf Coast Claims Facility and BP to press for more funding.
She said many community groups have used their own limited resources to help residents.
“When resources are limited, folks go to their local organization for assistance,” West said. “The requests are demanding right now.”