Gulf of Mexico Oil Spill Blog Supplemental Payments

Supplemental Payments

feinberg-ken gulf of mexico oil spill Supplemental Payments

Feinberg: Claims process ‘not extortion,’ underpaid businesses can request supplemental checks

Dan Murtaugh, Press-Register Dan Murtaugh, Press-Register

MOBILE, Ala. — Oil spill claims czar Ken Feinberg said Tuesday that business owners who feel underpaid by his organization will be able to request supplemental payments beginning next week. 

The comments came a day after U.S. Rep. Jo Bonner, R-Mobile, wrote a letter to U.S. Assistant Attorney General Tom Perrelli, noting his concerns with the claims process, and two days before a scheduled meeting between Feinberg and U.S. Sen. Richard Shelby, R-Tuscaloosa, to discuss claims payments. 

gulf of mexico oil spill Supplemental PaymentsFeinberg said that his Gulf Coast Claims Facility will begin a second round of interim payments next week. In addition, by filling out a separate form, people who think Feinberg’s process shortchanged them can ask for additional money.

Neither process, he said, requires a person to sign away the right to sue BP PLC when accepting the money. And that, Feinberg insisted Tuesday, means he is not guilty of extortion, an accusation leveled by Alabama Gov. Bob Riley last week. 

“If I’ve made a mistake, if I haven’t treated them fairly, I will give them a supplemental check,” he said. “I don’t want them to feel like they’re visiting the dentist’s office. 

“It’s not extortion,” he said. “They do not need to waive their right to sue.” 

Riley could not be reached for comment Tuesday night. 

Feinberg also said he will add staff next week to answer people’s specific questions about claims. The workers will be situated in existing claims offices along the coast. 

He said that people will also get an explanation of how the claims facility calculated their payment amount, which has been a bone of contention for many in the process. 

“People have the right to know that,” he said. 

Feinberg’s Gulf Coast Claims Facility, which since Aug. 23 has been handling compensation for individuals and businesses harmed by the Gulf spill, has paid out more than $1.86 billion to nearly 114,000 claimants. 

But his operation has come under harsh criticism in recent weeks from business owners and elected officials in south Alabama on a number of fronts: 

  • Several large businesses with claims of more than $1 million reported being paid just a small fraction of their losses. 
  • Letters from Feinberg’s operation told business owners who felt they had been underpaid that they would have to wait for the final claims process — which requires they waive their right to sue BP — to argue for more money. Such letters, Riley said, prompted him to call Feinberg’s process “extortion.” 
  • Business owners said they got no information about how payments were calculated, even in cases where amounts were vastly different than losses claimed. 

“Most (businesses) have been paid only pennies on the dollar of their total claim and are given no justification as to how the GCCF arrived at their payment amount,” Bonner said in his Monday letter to Perrelli. “For those who were denied outright, no explanation is given. 

“The path on which Mr. Feinberg chooses to take claimants over the next few weeks could determine the long-term economic viability of coastal Alabama,” Bonner wrote. 

Shelby spokesman Jonathan Graffeo said the senator will meet with Feinberg in Washington D.C. Thursday evening. 

Feinberg said he respects the officials for looking out for their constituents, but feels that what is lost amid the criticism is that he has paid out more than $340 million in Alabama alone. “No good deed goes unpunished,” he said. 

He also said that about 85 percent of business claimants got 100 percent of the amount they asked for. Riley has asked Feinberg for that same statistic among claims for $1 million or greater. Feinberg said Tuesday that he did not know what percentage of businesses with claims over $1 million had been paid at 100 percent, but did plan to get that information to Riley. 

source: Feinberg: Claims process ‘not extortion,’ underpaid businesses can request supplemental checks |

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