Originally posted by John Schwartz - New York Times - February 1, 2011
The Gulf of Mexico should recover from the environmental damage caused by the enormous BP oil spill last year faster than many people expected, according to new estimates in reports commissioned by Kenneth R. Feinberg, the administrator of the $20 billion compensation fund.
That prediction will be central to Mr. Feinberg’s plan for paying people who claim their livelihoods were devastated by the spill. It is certain to be controversial among those who believe the damage will be longer-lasting and therefore should result in higher payouts for the spill’s victims.
Mr. Feinberg’s report, to be officially released Wednesday, will lay out for the first time the framework for deciding who gets final settlements for spill-related damage and how payments for future losses will be determined.
Based on the work of environmental scientists, economists and other experts, the report acknowledges that “prediction is not an exact science” but estimates that the gulf should recover by the end of 2012. The hardest-hit oyster beds could take much longer to come back, it says.
Based on those estimates, the damages paid out by the fund would be double the first year’s losses for most of those filing claims, less any money previously paid by the fund. Those whose living is tied to oyster beds would receive four times their 2010 losses.
Mr. Feinberg, appointed in June by BP and the Obama administration, has given out more than $3.5 billion so far in emergency money to those affected by the spill.
But Gulf Coast residents have become increasingly angry over what they say are shortcomings of the program, including inconsistent payments and an opaque process. The methodology for final settlements is meant to answer those criticisms.
Mr. Feinberg has also been criticized by plaintiffs’ lawyers who have filed complaints with the judge in New Orleans who is overseeing federal spill litigation. They have accused the administrator of not being truly independent from BP, and asked the judge to exercise authority over the compensation process.
On Tuesday, the governor and attorney general of Louisiana and the attorney general of Mississippi filed similar requests with the judge, Carl J. Barbier.
A key document used to formulate plans for commercial fishermen making claims was a report by Wes Tunnell, a marine biologist at Texas A&M’s Harte Research Institute in Corpus Christi, who has extensive experience studying oil spills.
The 39-page report acknowledges that any definitive assessment at this point is impossible, and that fully understanding the spill’s ecological effects will take years.
But Dr. Tunnell concluded over all that regional 2011 catches for blue crabs, shrimp, oysters and fin fishes should be in line with catches before the spill.
His report adds, however, that some oyster beds may not recover for 6 to 10 years, and that there will be fewer fish, shrimp and crabs in the nets in some areas.
Dr. Tunnell was paid $225 an hour by the claims fund, which is in turn financed by BP.
Under the new framework for claims, documentation requirements for spill-related damages are expected to be tougher than those under last year’s emergency program, but no one is automatically excluded from filing a claim.
Wednesday’s announcement will be followed by a two-week comment period in which people can argue with the estimates and methodology. The comments will be available online. Payments will begin after the comment period.
While the new report will define the parameters for future compensation, the settlements will be subject to negotiation.
Some 85,000 people have already reached a settlement with the fund through a quick-pay option that provides $5,000 to individuals and $25,000 to businesses with no additional documentation.
Those who might file claims and who believe that the damage will persist can wait to file for a settlement throughout the three-year life of the fund, and can receive interim payments while they watch and wait.
People dissatisfied with the final settlement offer can, under the Oil Pollution Act, appeal to the Coast Guard. So far 507 appeals have been filed with the Coast Guard, which has so far consistently agreed with the estimates of the Feinberg fund.
BP declined to comment.
A lawyer with thousands of clients along the coast said the new framework would lead him and dozens of other lawyers to the negotiating table with Mr. Feinberg.
“It’s in my clients’ interest to get this over with quickly,” said Daniel E. Becnel Jr., a Louisiana lawyer who represents many coastal resorts and condo owners.
Stuart H. Smith, a lawyer in New Orleans who has said he would be interested in exploring settlements, said he had “serious concerns” about the plan. “I don’t think that it sufficiently takes into consideration the uncertainty factor,” Mr. Smith said.
A coastal fisherman was blunt in his criticism. “This is typical BP trying to get off the hook,” said Ray Brandhurst, owner of a 47-foot shrimp boat. “I’m sure you’re going to hear people screaming from across the Gulf Coast.”
According to the report, two factors reduced the expected harm. First, the oil gushed for a shorter time than did the Ixtoc I spill off Mexico, which began in 1979, and, second, it occurred during months of relatively calm seas. Also, the closing of fisheries during the crisis allowed marine populations not directly affected by oil to prosper.
Marine experts differed over the conclusions of the Tunnell report. James Cowan, a biological oceanographer at Louisiana State University, said, “He may be right, and I hope he’s right.” But Dr. Cowan added: “It doesn’t sit well with me. I think it’s too soon to just write it off.”
Dr. Cowan’s group has been working with shrimp and fish both offshore and near shore, and he said the group members had found troubling signs of apparent oil damage. They have seen reduced growth and higher death rates of shrimp in the marshes, Dr. Cowan said, and significant declines in catch rates for red snapper and other reef fishes.
“In my mind, the long-term, indirect effects are going to be the most insidious and also the most difficult to ascertain,” he said.
But another leading marine scientist applauded Dr. Tunnell’s work. Steve Murawski, former chief science adviser for the National Marine Fisheries Service, said Dr. Tunnell had “done a great job” in a situation requiring quick analysis so people can move forward.
“Decisions have to be made,” Mr. Murawski said, “and sometimes they are made with imperfect information.”