To date, its really unknown whether marine businesses will be fairly and fully compensated for lost income resulting from BPs well from hell. While final claim criteria isnt expected for several weeks, comments already made that proximity to the spill may be a prime factor in assessing damage raises immediate concerns about fair treatment.
When it comes to our industry, Kenneth Feinberg, the administrator of the newly established Gulf Coast Claims Facility with the $20 billion BP fund to pay compensation claims, needs to rethink the proximity condition. Such a standard seems certain to short-change boat dealers, manufacturers and equipment suppliers who have been damaged by the spill as documented by a recent survey conducted by NMMA. The geography of the oil spill should not be presumed to be the geography of its impact or limit those compensable.
As the funds administrator, Feinberg comes highly regarded. He headed up a similar fund for victims of the 9/11 terrorist attacks. In taking over the BP fund Aug. 23, he promised to quickly get compensation to people who deserve it. Thats commendable, of course, but the devil always lurks in the details.
For example, as Adm. Thad Allen pointed out, this spill actually happened over hundreds of miles of waters and shoreline along four states. Moreover, thousands of square miles of Gulf waters were closed to recreational (and commercial) fishing and boating, effectively killing boater and angler tourism and even orders for new boats. In such light, any requirement to agree to final settlement quickly will certainly hurt marine businesses. After all, the true impact of the spill may not be known for years, especially when were talking about fishing.
Clearly, we should call for Feinberg to exhibit substantial latitude as to how much is awarded to whom and, for that matter, any deadlines imposed for determining losses. On the other side, dealers and manufacturers must do a thorough job of documenting business losses from the spill.
Now that the oil has stopped pouring into the Gulf, the announced November cut-off to apply for emergency funds is, arguably, reasonable so long as it doesnt require the recipient to agree its a final settlement. However, the proposed 2013 deadline to file for a final settlement should be unacceptable since there are likely, if currently unidentified, long term effects on boating, fishing, tourism, boat sales, usage and the products and services normally purchased for such pursuits.
As previously reported in TradeOnlyToday, Cindy Squires, NMMAs chief counsel for pubic affairs, has been the point person for the industry, attempting to nail down the rules that will govern the claims process. As these become clearer, we stand ready to try and help the industry through this process, Squires promises.
Its believed few claims by the marine industry have been made to date. But because of the very nature of our business, it doesnt take an MBA to recognize that the spill positively damaged dealers, marinas and manufacturers, and just compensation should be in order. If you fit that profile, watch for more information and direction soon.