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Gulf oil spill: Cash may flow from BP fund soon

July 15, 2010 |  1:53 pm

Payments could begin within a few weeks from a $20-billion fund BP set aside to pay for the economic effects of its spill in the Gulf of Mexico, the fund's top administrator told hundreds of Houma, La., residents at a town hall meeting Thursday afternoon.

Kenneth Feinberg, who headed the Sept. 11 Victim Compensation Fund, held a series of town hall-style meetings to answer questions from affected residents. He also met with local government officials Thursday morning.

"This is not about politics," he said in a crowded auditorium in Houma, about 60 miles southwest of New Orleans. "This is about helping people in the gulf." 

He emphasized that claims facilities are independent of the government and of BP, and will be operating in affected areas for three years, to serve those whose economic well-being has been directly affected by the oil spill.

Feinberg addressed a fairly calm crowd in Houma, and said he will be coming back to the Gulf States "as often as necessary" to help people understand the claims process. His biggest concern, he said, is that people won't file claims, and he cautioned people against filing lawsuits for their losses.

"If you don't file a claim, I can't pay you," he said, his Boston accent showing through.

Residents asked a variety of questions related to individual situations. Thomas Dardar Jr., the chief of the United Houma Nation, wondered if members of his tribe could be compensated for the loss of valuable land for trapping, fishing and sacred rituals.

"Absolutely: You have a claim," Feinberg said.

For others, it wasn't so simple.

Amanda Domangue, 43, owns Justice Transport, a company that transports supplies such as drilling jars and perforating guns to oil rigs. She said she's not eligible for claims through BP because her claim isn't related to oil damage, such as tainted oyster beds or closed waters. She can't access the $100-million moratorium compensation fund because she isn't a rig worker. But Domangue estimated that 85% of her business has been lost since April 20.

"Ma'am you are exactly in no-man's land," Feinberg said.

Domangue said she wasn't surprised.

"We're stuck," she said, adding that there are thousands of other contractors related to the oil industry who are out of work and unable to receive compensation.

Once the well is capped, Feinberg said, emergency payments will continue for 60 days. He said people need to be able to verify income, even through a simple document such as a check stub or checkbook. He said even having someone like a town mayor or sheriff verify income would work.

He needs something to avoid fraud, he said. "I'm not looking to get fancy here."

Feinberg promised transparency, adding that the public will be able to access data related to how many claims and the amounts paid out.

He agreed with an audience member that the current "decentralized system is in shambles."

Feinberg has experience with compensation: He processed 7,300 claims in 33 months after 9/11, he said.

He said the gulf compensation fund will be different from the 9/11 fund he previously oversaw.

What is similar is the surge in emotion, he said.

"You cannot do this program from Washington," he said.

Lawrence Gautier, 64, of Dulac, who works as an oyster packer at Gautier Enterprises, said he was impressed with Feinberg. He filed a claim with BP only to receive a check at his address with the wrong name.

"I'm glad he took over," he said.

-- Nicole Santa Cruz, from Houma, La.