Image: Ken Feinberg, Gulf Coast Claims Facility Administrator
John Raoux  /  AP
Gulf Coast Claims Facility Administrator Ken Feinberg says victims of the Gulf of Mexico oil spill should start getting bigger payments faster.
updated 9/26/2010 1:03:15 AM ET 2010-09-26T05:03:15

Victims of the Gulf of Mexico oil spill should start getting bigger payments faster, the administrator of the fund set up to help them said Saturday.

Kenneth Feinberg said he was responding to criticism from residents and businesses.

"Over the past few weeks, I have heard from the people of the Gulf, elected officials, and others that payments remain too slow and not generous enough," Feinberg said in a statement. "I am implementing new procedures that will make this program more efficient, more accelerated and more generous."

Anthony Kennon, mayor of hard-hit Orange Beach, Ala., said he wasn't moved by the news. He said people in his community need action now, and they don't feel they are getting it. He said he doesn't believe Feinberg has truly been addressing their main concern about wanting a seat at the decision-making table.

"They feel despair, they feel helpless, they feel abandoned," Kennon said. "These are all mom-and-pop shops. We are devastated. I've got people knocking on my door saying, 'I'm leaving, great knowing you mayor. I'm losing my business, my home.'"

Because tourism has taken such a hit in his community, doctors who rely on walk-in tourists for patients in the summer have seen business fall off a cliff. But, Kennon said those doctors' claims to the compensation fund are being summarily denied because of the type of industry they are in.

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"I am having a hard time understanding how he is our advocate," Kennon said of Feinberg.

According to Feinberg, claims from now on will be sorted by industry to allow those reviewing the claims to apply a more specific, uniform set of standards when deciding how much a person or business will be paid. Feinberg did not provide details, and it was unclear if the new processing guidelines would benefit people in industries not directly tied to the ocean or simply make payments to victims in industries that are being compensated more consistent.

Claims still will be reviewed individually but they will be clustered so they are easier to compare, he said.

The Gulf Coast is still recovering from the spill triggered April 20, when a rig explosion killed 11 workers and led to 206 million gallons of oil spewing from BP PLC's undersea well.

In less than five weeks, the dedicated $20 billion fund that BP set up has paid out over $400 million to more than 30,000 claimants, Feinberg said. Kennon scoffed at the claim about how much has been paid, noting that it is 2 percent of the total amount that BP agreed to set aside.

"That number is very misleading," Kennon said. "$400 million across the entire Gulf Coast is nothing. What if there has already been $10 billion lost across the Gulf Coast?"

Currently, people are getting an emergency payment from the fund and then, down the road, they will receive a lump-sum final payment. The final payment requires recipients agree not to sue BP.

Earlier this week, Feinberg made a key concession to victims when he said he would waive a requirement that wages earned by spill cleanup workers be subtracted from their claims of lost revenue.

Feinberg said that will help fishermen who have been working on spill response while they couldn't fish.

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Video: BP claims czar : 'We oversold this program'

  1. Transcript of: BP claims czar : 'We oversold this program'

    BRIAN WILLIAMS, anchor: gulf oil spill. Let's not forget 87 days worth of oil in that water, and about that $20 billion compensation fund. It's been a month since Ken Feinberg took over the claims process from BP . He's a lawyer with a track record of handling other difficult situations, like the fund for the 9/11 victims families. Gulf residents welcomed him as a plain spoken New Englander and a hero when he went back to Orange Beach , Alabama , to see how he's doing. Our report from our senior investigative correspondent Lisa Myers .

    LISA MYERS reporting: Since the spill, BP has pounded home this message.

    Unidentified Man #1: BP has got to make things right.

    Mayor TONY KENNON: And they're spending $100 million on a PR blitz to tell the rest of the country they're making us whole. Guys, it's not true. It's not true.

    MYERS: And Mayor Tony Kennon of Orange Beach , Alabama , devastated when tourists stayed away, says the new independent claims administrator Ken Feinberg has not made things better.

    Mayor KENNON: So we're very upset with the overall performance of Ken Feinberg .

    MYERS: In an interview, Feinberg acknowledges problems.

    Mr. KEN FEINBERG: We haven't processed all of the claims as quickly as we should have. I oversold this program at the beginning and I'm paying the price for it. I do not work for BP .

    MYERS: He's been the target of anger and frustration at recent town hall meetings.

    Ms. RHONDA DRUMMOND (Small Business Owner): You've killed my working class business.

    MYERS: We went back to two businesses we've kept up with. Jeff Hardy owns a shoe and apparel business and says his losses are now more than a million dollars. He's received one check for $5,000. These twin sisters who plan weddings on the beach have received $29,000 on a claim of $240,000.

    Ms. SHEILA NEWMAN (Orange Beach Weddings): We feel like we deserve what we lost, and that's all we're asking for is give us what we lost.

    MYERS: Do you understand how angry and desperate some of these people are when you send them these tiny checks?

    Mr. FEINBERG: I understand the frustration. I understand the concern. Remember, though, that there are thousands of citizens in the gulf who received very, very generous checks.

    MYERS: Feinberg 's office has paid out almost $350 million for 26,000 claims in only a month. He showed us several e-mails from grateful claimants. And overall gives himself a pretty good grade. Feinberg says most still waiting for money simply haven't provided enough documentation.

    Mr. FEINBERG: They just don't have the backup to justify it.

    MYERS: But Hardy says he's provided 1700 pages to back up his claim.

    Mr. JEFF HARDY: Now I'm being told, since I've got so much information on the table, then it cannot be processed.

    Unidentified Man #2: No, that's ridiculous.

    MYERS: Feinberg says he's sticking to his promise. Anyone who can prove lost income will be fully compensated.

    Mr. FEINBERG: If I don't do that, I've failed. I've failed.

    MYERS: Lisa Myers , NBC News, Washington.


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