Governor Jindal: BP Claims System is Broken
GRAND ISLE (June 22, 2010) -
GRAND ISLE – Today, Governor Bobby Jindal stood with members of the seafood processing and fishing industries at Gulf Stream Marina in Grand Isle where he said the BP claims system is broken and called on BP to be more transparent with the data to ensure claims are being properly processed and Louisianians are getting the help they need to recover from the spill.
The Governor was joined by Fred Marshall of Gulf Stream Marina, Coastal Bait Shop owner Al Cassagne, Camardelle’s Live Bait and Seafood owner Chris Camardelle, Dean Blanchard Seafood owner Dean Blanchard, Grand Isle Mayor David Camardelle, Jean Lafitte Mayor Tim Kerner, State Senator John Alario, State Representative Truck Gisclair and Jefferson Parish Councilmen Tommy Capella and Chris Roberts.
Governor Jindal said, “We are here at Gulf Stream Marina today and this is a recreational fishing marina that now sits empty because of the BP oil spill that caused the loss of recreational and commercial fishing activity that would usually be bustling at this time of year. This marina employs three people – and this is just one story of the many businesses here in Grand Isle that are struggling to deal with the very personal effects of this disaster on coastal Louisiana.
“On day 64 of this disaster, Gulf Stream Marina has a claim into BP for $113,000 in losses – but they haven’t received any payment for their business claim, only three checks for $5,000 each for personal payments. Last week, BP told the marina they would call in three days, but the marina still hasn’t received a call. Meanwhile, these folks are fighting to keep their business open. The owner is struggling to stay in the black while once again the help that was promised is still not here.
“Also here in Grand Isle is the Sand Dollar Marina, owned by Butch Gaspard. Butch has operated the Marina there for 13 years and he has been in business for 45 years. He employs 15 people and told us he generated around $2 million in revenue last year. This time of year is when most of his profits come in, but because of the spill, he instead is incurring serious losses this year. Butch has a total of six claims outstanding with BP, representing his various related businesses. He just got another call yesterday telling him that the earlier paperwork he submitted would have to be filled out again because it was ‘lost.’ This morning, he was told they ‘may’ have found it. In 2005, after Hurricanes Katrina and Rita, it cost Butch around $1.4 million to rebuild. Now – he faces the disaster of this BP oil spill.
“The bottom line is that the BP claims system is broken. Since May 3rd, the state has requested access to the BP claims system. Our most recent request asked BP to provide data by Noon on June 16th, but we still do not have the information we requested. I met with Ken Feinberg – the President’s new top official on the BP claims process – and told him that the process is broken and the many requests for information we have made to BP to date have still not been delivered to us.
“The drips and drabs of data that BP has provided to date have not been consistent or detailed enough for us to accurately monitor their process. Yesterday, BP gave us a summary of claims information saying that $61 million in claims have been paid in Louisiana – with 17,976 claims paid out of 20,138 claims filed.
“But – this summary gives us no way to determine how many of the 17, 976 payments represent partial payments or multiple payments to the same claimant; therefore, we have no way to know what percentage of total claims has actually been paid. Additionally, we already know of more than one instance where BP’s system shows that they paid someone far more than our follow up calls to that person confirmed.
“On June 7th, BP told us they would be willing to provide more detailed daily reports, while still not making their claims system completely transparent. However, yet again, this promise was not kept. We have not received any detailed reports on claims data since June 7th.”
Governor Jindal highlighted the errors found in the small amount of information that has been provided by BP to the state.
Governor Jindal said, “In analyzing the little information we have from BP, we found that while their June 18th report showed that businesses were supposed to receive payments for 2 months of operational costs plus an incremental 10 percent – businesses only got one month worth of operating cost. BP told us this was ‘due to human error in the claims processing system.’
“Other data we have received has been riddled with more errors and discrepancies – including one claimant who is listed as 215 years old, others with invalid Social Security numbers, zip codes that aren't in Louisiana, and 15 claimants with dates of birth that are in the future.
The Governor outlined several requests the state has made to BP to fix the broken claims process, including making the system transparent and providing details on how many contractors and subcontractors are Louisianians.
Governor Jindal said, “To help fix this broken system, we have made several requests that BP make their claims database fully transparent to the state. We also asked BP for details on how many of their contractors and subcontractors were Louisianians, after repeatedly requesting that they hire our own people that have been affected – any many left unemployed – by this oil spill. We have still not received comprehensive information on their workers either, but from the little information we have, we believe only 38 percent of hires are Louisianians.
“Despite BP's promise to provide claims data to the state day after day, they have only provided Louisiana with two more-detailed data sets since May 31.
“We were pleased that BP agreed to set up $20 billion over a four-year period in an escrow account for the Gulf Coast; however, we need a claims system that will function to help the many Louisiana workers affected by this spill. Today, that system stands broken, while more and more of our workers and businesses sit idle. This is hurting our Louisiana families, our communities, and our entire state.”
On June 4th, at the Governor’s request, the Louisiana Attorney General’s Office filed a petition for discovery and investigation in state court to order BP to produce information that the state needs to monitor their claims processes. The Governor called on BP and federal officials today to provide the state with access to ensure the claims are being processed properly. The Governor also said tomorrow the state is selecting an objective third party administrator to work with the state to conduct a review of the BP claims process and database.
“Today – we are calling on BP and federal officials to quickly give us the access we need to ensure claims are being properly processed and our people are getting the help they need to recover from this spill. Tomorrow, we will also select an objective third party administrator that will work with the state to implement a comprehensive review of the BP claims processes and database. The third party administrator will also support community-based claims with technical assistance organizations in their efforts to assist individuals and businesses with the claims process.
“We will also release a solicitation for proposals to select around 15 technical assistance providers to implement a six-month, comprehensive technical support plan for businesses and individuals impacted by the oil spill. These organizations will provide financial analysis and support for claims work. Technical assistance providers will help local leadership and service organizations and assist workers, business owners and operators in preparing their claims.
“None of our people want a BP check or an unemployment check – they want to get back to work. But, BP as the responsible party has an obligation to pay for all their losses as a result of this spill – and we need the federal government to make sure they are indeed responsible.”
UPDATE ON PROACTIVE STATE INITIATIVESSand-Berm/Dredging Update:
Governor Jindal said, “Federal officials have informed us this morning that they are effectively shutting down our dredging operations on the Chandeleur Islands, while we wait to move to another borrow site. We have told them we absolutely want to continue dredging in the current spot for another five days until we can make a seamless transition to the next borrow site – which is what we aimed at doing under our original permit and proposal – and will replace the borrowed dredged materials at that time.
“I am asking the federal government to let our dredging operations continue. We have had to fight for this plan every step of the way. We have already seen the results of the work. We absolutely cannot afford to lose another day.
“As of yesterday, 516,000 cubic yards of material have been transported for the eastern and western reaches of the sand-berm project on the northern Chandeleurs Islands. This is equivalent to piling one foot of sand onto 370 football fields. This includes approximately 451,000 cubic yards on the eastern side and 64,000 cubic yards on the western side. Nearly 5,000 feet of sand berm has been constructed to date.