[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]



 
     THE BP OIL SPILL AND GULF COAST TOURISM: ASSESSING THE IMPACT

=======================================================================


                                HEARING

                               BEFORE THE

                    SUBCOMMITTEE ON COMMERCE, TRADE,

                        AND CONSUMER PROTECTION

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE

                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             SECOND SESSION

                               __________

                             JULY 27, 2010

                               __________

                           Serial No. 111-150


      Printed for the use of the Committee on Energy and Commerce

                        energycommerce.house.gov




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                    COMMITTEE ON ENERGY AND COMMERCE

                 HENRY A. WAXMAN, California, Chairman
JOHN D. DINGELL, Michigan            JOE BARTON, Texas
  Chairman Emeritus                    Ranking Member
EDWARD J. MARKEY, Massachusetts      RALPH M. HALL, Texas
RICK BOUCHER, Virginia               FRED UPTON, Michigan
FRANK PALLONE, Jr., New Jersey       CLIFF STEARNS, Florida
BART GORDON, Tennessee               NATHAN DEAL, Georgia
BOBBY L. RUSH, Illinois              ED WHITFIELD, Kentucky
ANNA G. ESHOO, California            JOHN SHIMKUS, Illinois
BART STUPAK, Michigan                JOHN B. SHADEGG, Arizona
ELIOT L. ENGEL, New York             ROY BLUNT, Missouri
GENE GREEN, Texas                    STEVE BUYER, Indiana
DIANA DeGETTE, Colorado              GEORGE RADANOVICH, California
  Vice Chairman                      JOSEPH R. PITTS, Pennsylvania
LOIS CAPPS, California               MARY BONO MACK, California
MICHAEL F. DOYLE, Pennsylvania       GREG WALDEN, Oregon
JANE HARMAN, California              LEE TERRY, Nebraska
TOM ALLEN, Maine                     MIKE ROGERS, Michigan
JANICE D. SCHAKOWSKY, Illinois       SUE WILKINS MYRICK, North Carolina
CHARLES A. GONZALEZ, Texas           JOHN SULLIVAN, Oklahoma
JAY INSLEE, Washington               TIM MURPHY, Pennsylvania
TAMMY BALDWIN, Wisconsin             MICHAEL C. BURGESS, Texas
MIKE ROSS, Arkansas                  MARSHA BLACKBURN, Tennessee
ANTHONY D. WEINER, New York          PHIL GINGREY, Georgia
JIM MATHESON, Utah                   STEVE SCALISE, Louisiana
G.K. BUTTERFIELD, North Carolina
CHARLIE MELANCON, Louisiana
JOHN BARROW, Georgia
BARON P. HILL, Indiana
DORIS O. MATSUI, California
DONNA M. CHRISTENSEN, Virgin 
    Islands
KATHY CASTOR, Florida
JOHN P. SARBANES, Maryland
CHRISTOPHER S. MURPHY, Connecticut
ZACHARY T. SPACE, Ohio
JERRY McNERNEY, California
BETTY SUTTON, Ohio
BRUCE L. BRALEY, Iowa
PETER WELCH, Vermont
        Subcommittee on Commerce, Trade, and Consumer Protection

                        BOBBY L. RUSH, Illinois
                                  Chairman
JANICE D. SCHAKOWSKY, Illinois       CLIFF STEARNS, Florida
    Vice Chair                            Ranking Member
JOHN SARBANES, Maryland              RALPH M. HALL, Texas
BETTY SUTTON, Ohio                   ED WHITFIELD, Kentucky
FRANK PALLONE, Jr., New Jersey       GEORGE RADANOVICH, California
BART GORDON, Tennessee               JOSEPH R. PITTS, Pennsylvania
BART STUPAK, Michigan                MARY BONO MACK, California
GENE GREEN, Texas                    LEE TERRY, Nebraska
CHARLES A. GONZALEZ, Texas           MIKE ROGERS, Michigan
ANTHONY D. WEINER, New York          SUE WILKINS MYRICK, North Carolina
JIM MATHESON, Utah                   MICHAEL C. BURGESS, Texas
G.K. BUTTERFIELD, North Carolina
JOHN BARROW, Georgia
DORIS O. MATSUI, California
KATHY CASTOR, Florida
ZACHARY T. SPACE, Ohio
BRUCE L. BRALEY, Iowa
DIANA DeGETTE, Colorado
JOHN D. DINGELL, Michigan (ex 
    officio)
  
                             C O N T E N T S

                              ----------                              
                                                                   Page
Hon. Bobby L. Rush, a Representative in Congress from the State 
  of Illinois, opening statement.................................     1
    Prepared statement...........................................     3
Hon. Ed Whitfield, a Representative in Congress from the 
  Commonwealth of Kentucky, opening statement....................     7
    Prepared statement...........................................     8
Hon. Henry A. Waxman, a Representative in Congress from the State 
  of California, opening statement...............................    11
    Prepared statement...........................................    12
Hon. Joe Barton, a Representative in Congress from the State of 
  Texas, opening statement.......................................    15
    Prepared statement...........................................    17
Hon. Kathy Castor, a Representative in Congress from the State of 
  Florida, opening statement.....................................    21
Hon. Cliff Stearns, a Representative in Congress from the State 
  of Florida, opening statement..................................    21
Hon. Gene Green, a Representative in Congress from the State of 
  Texas, opening statement.......................................    22
Hon. Robert E. Latta, a Representative in Congress from the State 
  of Ohio, opening statement.....................................    23
Hon. Betty Sutton, a Representative in Congress from the State of 
  Ohio, opening statement........................................    23
Hon. Phil Gingrey, a Representative in Congress from the State of 
  Georgia, opening statement.....................................    24
Hon. Steve Scalise, a Representative in Congress from the State 
  of Louisiana, opening statement................................    24
Hon. Charlie Melancon, a Representative in Congress from the 
  State of Louisiana, prepared statement.........................    99

                               Witnesses

Kenneth Feinberg, Administrator, Gulf Coast Claims Facility......    26
    Prepared statement...........................................    28
    Answers to submitted questions...............................   102
Roger Dow, President and CEO, U.S. Travel Association............    30
    Prepared statement...........................................    32
    Answers to submitted questions...............................   107
Rip Daniels, CEO/Manager, WJZD-FM, Vice President, Mississippi 
  Gulf Coast Tourism Commission..................................    39
    Prepared statement...........................................    41
Herb Malone, President and CEO, Alabama Gulf Coast Convention and 
  Visitors Bureau................................................    47
    Prepared statement...........................................    49
    Answers to submitted questions...............................   114
Keith Overton, Senior Vice President and Chief Operating Officer, 
  Tradewinds Resort, and Chairman, Florida Restaurant and Lodging 
  Association....................................................    54
    Prepared statement...........................................    57
Ralph O. Brennan, President, Ralph Brennan Restaurant Group, LLC.    67
    Prepared statement...........................................    70
    Answers to submitted questions...............................   118

                           Submitted Material

Statement of the Northwest Florida Tourist Development Council 
  Coalition......................................................   100


     THE BP OIL SPILL AND GULF COAST TOURISM: ASSESSING THE IMPACT

                              ----------                              


                         TUESDAY, JULY 27, 2010

              House of Representatives,    
           Subcommittee on Commerce, Trade,
                           and Consumer Protection,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
    The Subcommittee met, pursuant to call, at 10:03 a.m., in 
Room 2322 of the Rayburn House Office Building, Hon. Bobby L. 
Rush [Chairman of the Subcommittee] presiding.
    Members present: Representatives Rush, Schakowsky, 
Sarbanes, Sutton, Green, Gonzalez, Butterfield, Barrow, Castor, 
DeGette, Waxman (ex officio), Melancon, Whitfield, Stearns, 
Terry, Gingrey, Scalise, Latta, Barton (ex officio), and 
Burgess.
    Staff present: Michelle Ash, Chief Counsel; Tim Robinson, 
Counsel; Angelle Kwemo, Counsel; Anna Laitin, Counsel; Will 
Wallace, Special Assistant; Elizabeth Letter, Press Assistant; 
Jeremy Feigenbaum, Intern; Billie McGrane, Intern; David 
Cavicke, Chief of Staff; Amanda Mertens Campbell, General 
Counsel; Katie Wheelbarger, Deputy Chief of Staff; Brian 
McCullough, Senior Professional Staff; Kevin Kohl, Professional 
Staff; Aaron Cutler, Counsel; and Sam Costello, Legislative 
Analyst.

 OPENING STATEMENT OF HON. BOBBY L. RUSH, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF ILLINOIS

    Mr. Rush. The Subcommittee on Commerce, Trade, and Consumer 
Protection will come to order. I thank those who have gathered 
here for this hearing, and the Chair recognizes himself for 2 
minutes for an opening statement.
    The Chair wanted to remind the members that anyone other 
than the Full Committee Chair or the Full Committee Ranking 
Member or the Chairman Emeritus will be encouraged to limit 
their opening remarks to 2 minutes because of the time 
consideration for some of our witnesses.
    April 20 was a tragic day for the people of the Gulf Coast 
region of the United States. Eleven workers died following an 
explosion on the Deep Water Horizon oil drilling rig located 40 
miles offshore in the Gulf of Mexico. Since that tragic day an 
estimated 50 to 150 million gallons of oil have leaked into the 
Gulf, severely damaging our environment, destroying people's 
way of life, and severely damaging the entire region's economy.
    Tourism is the Gulf Region's second largest industry. It 
generates more than $39 billion in state revenue. Tourism 
represents 46 percent of the region's economy. Tourism employs 
over one million people. Various setting indicate that this oil 
spill has put 300,000 jobs at risk, representing 15 percent of 
the total job base in the region.
    The saddest part of this story is that some of the 
businesses that are impacted today were still recovering from 
the aftermath of Hurricane Katrina, which occurred over 5 years 
ago. Now then BP has created a $20 billion claim pool to 
compensate victims who have been impacted by the oil spill.
    The purpose of this hearing is to make sure that the travel 
and tourism industry will not be left behind, that they will be 
included. One might ask why. Well, I am glad you asked.
    Because of the intricacy of that particular industry, the 
complexity of the methodology that needs to be employed to 
determine the level of damages and grant compensation and 
because of the tourisms vast economic impact on the entire Gulf 
Coast Region.
    Furthermore, we have learned from the massive media 
coverage of the oil spill and by various studies by the tourism 
industry itself that it is losing business not only because of 
the beaches may not be safe but also because travelers perceive 
that it is not safe to travel to the Gulf Coast Region of the 
U.S.
    You have also heard the concerns of the industry about the 
claims process, its timeframe for compensation and eligibility.
    Finally, we have to consider what needs to be done to bring 
back the industry to the stature it had before the oil spill. 
These are difficult issues we have to examine here today. The 
complexity of the matter may require more than one hearing.
    I want to thank all the witnesses for appearing before this 
subcommittee. We have concerns about the tourism industry and 
how it will be compensated and how it will be revitalized, and 
I hope our discussion today be a very fruitful and productive 
one.
    [The prepared statement of Mr. Rush follows:]
    [GRAPHIC] [TIFF OMITTED] 78127A.001
    
    [GRAPHIC] [TIFF OMITTED] 78127A.002
    
    [GRAPHIC] [TIFF OMITTED] 78127A.003
    
    [GRAPHIC] [TIFF OMITTED] 78127A.004
    
    Mr. Rush. With that I yield back the balance of my time. 
Now I recognize the Ranking Member for 2 minutes.

  OPENING STATEMENT OF HON. ED WHITFIELD, A REPRESENTATIVE IN 
           CONGRESS FROM THE COMMONWEALTH OF KENTUCKY

    Mr. Whitfield. Mr. Chairman, thank you and I want to 
welcome all the witnesses today. We appreciate Mr. Feinberg 
being with us, as well as representatives of the tourism 
industry.
    We know that since the explosion of the Deepwater Horizon 
oil rig on April 20 the Gulf Coast economy has faced many 
difficult challenges. We also know that this is the summer peak 
months for tourism and that many people have been adversely 
impacted by this incident.
    It is my understanding that BP prior to the Gulf Coast 
claims funding set-up gave Florida $25 million to promote 
tourism, Mississippi, Louisiana, and Alabama, $15 million each 
to counter the publicity and the impact, the perception that it 
would not be open for tourism.
    BP has been paying claims to businesses affected by the 
spill. They had paid out, it is my understanding over $200 
million thus far in claims. It is not surprising that some 
businesses are having difficulty at getting their claims 
processed quickly because really BP is not an insurance 
company.
    The administration of the claims process is being handled 
by Mr. Feinberg. He certainly has experience in this arena, 
having disbursed funds as a result of the 9/11 incident. It is 
my understanding that he is going to be taking control of 36 BP 
offices and 1,500 employees established to pay claims to 
qualified businesses.
    Mr. Feinberg is charged with administering the entire $20 
billion Gulf Coast claims account and paying legitimate claims 
to affected parties. It is an admirable and certainly a 
difficult position because we know that paying claims in this 
kind of a situation is certainly an inexact science. Will it be 
restricted to the beach resorts only, or will downstream 
suppliers to the tourism industry qualify for compensation? 
There are a lot of unanswered questions. We do want to see that 
people are reimbursed who have legitimate claims. We know that 
there will be some people filing claims that are not 
legitimate, but that is one of the challenges that Mr. Feinberg 
faces.
    And then one other question that I think is going to have 
to be answered as we go along is the drilling moratorium 
imposed by the Administration is certainly going to have an 
impact on the economy up and above the impact on the tourism as 
a result of the spill. And there is going to have to be some 
questions asked about who should pay for the cost of those--of 
that moratorium. Should it be the government, should it be BP? 
So there are a lot of unanswered questions, and I know that 
this committee is totally committed to making sure that 
everyone receives compensation that deserves it. We look 
forward to your expertise, your thoughts on this important 
subject and certainly look forward to all of your testimony.
    Thank you.
    [The prepared statement of Mr. Whitfield follows:]
    [GRAPHIC] [TIFF OMITTED] 78127A.005
    
    [GRAPHIC] [TIFF OMITTED] 78127A.006
    
    [GRAPHIC] [TIFF OMITTED] 78127A.007
    
    Mr. Rush. The Chair recognizes the Chairman of the Full 
Committee, Mr. Waxman, for 5 minutes.

OPENING STATEMENT OF HON. HENRY A. WAXMAN, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. Waxman. Thank you very much, Mr. Chairman.
    The BP spill on the Gulf of Mexico is the worst 
environmental disaster this country has ever seen, and while we 
have every hope that the cap will hold and the flow of oil into 
the Gulf has truly stopped, we know that the devastation is 
enormous, and its affects will continue for years.
    In the 3 months since the Deepwater Horizon explosion and 
blowout, the Committee on Energy and Commerce has held eight 
hearings examining the causes of the explosion, efforts to 
mitigate the damage, and the impacts on the environment and the 
local community.
    I would like to thank Chairman Rush for holding our ninth 
hearing which will focus on the impacts of the spill on tourism 
and the tourism economy in the Gulf area. The economies of 
Louisiana, Mississippi, Alabama, and Florida are heavily 
dependent on the travelers who come to the Gulf Coast beaches 
each summer for swimming, fishing, and other activities across 
each of these four States. Some beaches are closed, and 
significant fishing grounds are still off limits. Hotels, 
restaurants, charter boats, and resorts are facing 
cancellations. Tourists are shying away from the areas of the 
Gulf even where no oil has come ashore. Diners and grocery 
shoppers across America are asking about whether the seafood is 
from the Gulf and whether it is safe to eat.
    Today we will hear from tourism officials and businesses 
from each of the four States dealing with this catastrophe. We 
will also hear from Kenneth Feinberg, the independent 
administrator in charge of handling all claims for damage and 
loss of the oil spill. He is responsible for determining the 
proper level of compensation for each business, worker, and 
family impacted by the spill.
    This hearing will give the committee a better understanding 
of the impacts of the spill on an essential part of the Gulf 
Coast economy and help us understand what we can do further to 
help the region recover. I thank all the witnesses for being 
here today, and I look forward to their testimony.
    Thank you, Mr. Chairman.
    [The prepared statement of Mr. Waxman follows:]
    [GRAPHIC] [TIFF OMITTED] 78127A.008
    
    [GRAPHIC] [TIFF OMITTED] 78127A.009
    
    [GRAPHIC] [TIFF OMITTED] 78127A.010
    
    Mr. Rush. The Chair now recognizes the gentleman from 
Florida, Mr. Stearns, for 2 minutes. For 1 minute. I am sorry.
    Oh, I am sorry. I didn't see the Ranking Member down there.
    Mr. Barton. I am willing to let Mr. Stearns go.
    Mr. Rush. He is to my left. You are not normally on my 
left.
    The Chair now recognizes the Ranking Member of the Full 
Committee, Mr. Barton, my friend from Texas, for 5 minutes.

   OPENING STATEMENT OF HON. JOE BARTON, A REPRESENTATIVE IN 
                CONGRESS FROM THE STATE OF TEXAS

    Mr. Barton. I thank the distinguished gentleman from the 
windy city of Chicago, home of the Cubs and the White Sox. I 
appreciate that.
    I want to thank Chairman Rush and Chairman Waxman for 
convening this hearing today, and appreciate Ranking Member 
Whitfield, whose leadership on this issue. I want to thank each 
of you witnesses for appearing before us today. I know it is a 
busy time for all of you.
    Since the Deepwater Horizon exploded and sank 3 months ago, 
this committee in my opinion has conducted a fair and rigorous 
investigation of the accident and developed what I consider to 
be a measured Congressional response. Our Oversight and 
Investigations Subcommittee, Energy and Environment 
Subcommittee, Health Subcommittee, and now the Commerce, Trade, 
and Consumer Protection Subcommittee are each doing their best 
to review and discuss all of the issues surrounding the oil 
spill.
    As a result of these investigations and the bipartisan 
engendered by them, the Full Committee recently voted 48 to 
zero to report out a Blowout Prevention Bill that, again, in my 
opinion is a balanced response to the tragedy.
    I want to welcome all of you witnesses today to consider 
our investigation, continue the investigation. I especially 
want to welcome Mr. Ken Feinberg. Mr. Feinberg has competently 
administered the 9/11 Victims Compensation Fund. That was a 
very tough job, and I expect him to competently and 
transparently administer the current BP Spill Escrow Account.
    The people of the Gulf Coast who have lost their jobs or 
had their livelihoods diminished by the oil spill should be 
compensated, should be compensated fairly, and should be 
compensated quickly. We are going to hear from some of the 
people who have been affected when we get to the other 
witnesses on this panel today.
    Tourism, fishing, and energy development are vital to the 
Gulf Coast where they employ hundreds of thousands of people. 
The tourism industry, which is the focus of today's hearing, by 
itself generates over $30 billion a year.
    The oil spill reveals much about the Gulf Coast community. 
Many of us on this committee have come to know the strength of 
that community following the vast swath of destruction that was 
left by Hurricane Katrina nearly 5 years ago. Gulf Coast people 
are nothing if not resilient, but with this latest manmade 
disaster some of those folks must be wondering what on earth is 
going to hit them next.
    The Gulf Coast economy is tied to earth and ocean 
resources. The industries along the Gulf are so intertwined 
that the losses in one sector ripple throughout the entire 
regional economy. That is why if you are going to understand 
the magnitude of the tragedy, we must listen closely to those 
who are being directly affected by the Administration's 
decisions, especially the one currently to ban energy 
exploration.
    I have said this before, but the Administration should 
reconsider its second moratorium decision. I think that is the 
wrong decision that they made. Enforcing a blanket policy in 
exploration is not unlike sending a new oil spill or a big 
storm to further threaten the jobs of the Gulf Coast. The 
Administration has shown some tendency towards panic in this 
regards lately. This should not be a time for panic but instead 
a moment, a time for careful, thoughtful consideration.
    I hope the Administration will choose not to forget about 
the fishermen, shrimpers, rig workers who share the same 
uncertainty as those who work on the beaches and the hotels and 
along the retail establishments of the main streets of the Gulf 
Coast.
    This is an important hearing. Again, I want to thank the 
witnesses. I look forward to your testimony, and again, Mr. 
Chairman, and Chairman and Ranking Member Whitfield, thank you 
for arranging this hearing.
    With that I yield back, Mr. Chairman.
    [The prepared statement of Mr. Barton follows:]
    [GRAPHIC] [TIFF OMITTED] 78127A.011
    
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    [GRAPHIC] [TIFF OMITTED] 78127A.014
    
    Mr. Rush. The Chair recognizes the gentlelady from Florida, 
Ms. Castor, for 1 minute.

  OPENING STATEMENT OF HON. KATHY CASTOR, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF FLORIDA

    Ms. Castor. Thank you, Chairman Rush and Chairman Waxman 
and Mr. Whitfield, for organizing this important hearing.
    You know, since April and the BP Deepwater Horizon blowout 
Floridians have been living their worst nightmare. The 
environmental damage, the economic damage is taking a terrible 
toll on our small business owners, our hotels, our fishermen. 
You know, we were just coming out of the recession, so BP's 
disaster is wreaking havoc again on our hard-working folks in 
Florida.
    And what is particularly frustrating in the Tampa Bay area 
where I represent, we have got the most beautiful beaches in 
the world, from Pinellas County, Manatee, Sarasota, all the way 
down to Sanibel Island. There is no oil there. The oil is 
hundreds and hundreds of miles away, and yet the word has gone 
out all across the globe, especially to Europe and South 
America, where we rely on all those tourists, that the Florida 
beaches are damaged, that the Gulf Coast is toxic.
    We have got to turn that perception around. The efforts of 
BP to date have been inadequate to say the least. What is 
particularly maddening is we watch these incessant ads, full-
page ads by BP, that are polishing their corporate image at a 
time where they should be devoting a good portion of those 
monies to helping small business owners, our hotels get back on 
their feet and explain to folks around the globe that our 
beaches are pristine, and we want you to come to Florida rather 
than how many millions and millions and millions of dollars 
have they spent on polishing their own corporate image.
    So that is the frustration I wanted to share today. So I am 
really looking forward to hearing from our expert witnesses. A 
special thank you to Keith Overton from the Tradewinds from St. 
Pete Beach who is the head of Florida's Restaurant and Lodging 
Association. We have a lot to learn from all of you, and I am 
glad you are here.
    Thank you.
    Mr. Rush. The Chair now recognizes the gentleman from 
Florida, Mr. Stearns for 1 minute.

 OPENING STATEMENT OF HON. CLIFF STEARNS, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF FLORIDA

    Mr. Stearns. Thank you, Mr. Chairman, and let me also 
compliment you and Mr. Whitfield for your leadership on this 
hearing and welcome Kenneth Feinberg, the Gulf Coast Claims 
Administrator here. He is going to have a tough job.
    I saw in the paper recently he said, ``I have a concern 
that BP is stalling claims. Yes, BP is stalling. I doubt they 
are stalling for money. It is not that. I just don't think they 
know the answer to the questions by the claimants.'' That is 
going to be true whether you decide a claim because of 
geographic distance or whether you decide a claim because of 
ownership. Are you going to ask for tax returns? I mean, how 
are you possibly going to figure out what particular claim is 
valid or not. So we all pray and hope that he will have the 
wisdom of Solomon to do this.
    I noticed in a report as of July 24 in Florida 41,818 
claims were made, and money that was handed out was 
$45,320,000. So obviously some claims have been paid, and a lot 
of people across many, many counties and including counties 
that are not even affected by the Gulf Coast, have been paid. 
Florida has the most densely-populated coastline of the United 
States, and so this spill threatens our beaches, and as a 
former restaurant, hotel owner I deeply sympathize and 
empathize with these businesses and hope obviously that they 
are not hurt badly and that we can come back.
    But in the end I think the hard questions for the 
Administrator, Mr. Feinberg, is how to solve the questions of 
who gets the money and gets served with the extra support.
    So, Mr. Chairman, I think this is a very important hearing 
to hear from Mr. Feinberg and as well as the members of the 
tourist industry, what they think should be done. So thank you.
    Mr. Rush. Mr. Green from Texas.

   OPENING STATEMENT OF HON. GENE GREEN, A REPRESENTATIVE IN 
                CONGRESS FROM THE STATE OF TEXAS

    Mr. Green. Thank you, Mr. Chairman, and like my colleagues 
I want to welcome our panel, particularly Mr. Feinberg, but on 
a personal note I would like to welcome Mr. Brennan here. You 
have reopened the Houston Restaurant after a terrible fire, and 
we appreciate it in Houston. And, Mr. Chairman, I want to thank 
you for raising the issues of the effects of the oil spill on 
tourism in the Gulf of Mexico.
    Having watched Jimmy Buffett's concert a few weeks ago from 
Gulf Shores, it is almost like we need that every week to get 
the word out along a number of different places on the Gulf 
Coast because that was a good turnout, people saw the clean 
beaches, and were enjoying the music. So we need to do more of 
that.
    Along the Alabama to Texas Gulf Coast oil and gas 
exploration, fishing, and tourism are the largest industries 
for employment in an economic progress. The oil spill is a 
profound impact on all three and during one of our worst 
economic times in the last 70 years.
    I represent a district in Houston where thousands has lost 
or furloughed their jobs as a result of the drilling 
moratorium. Other areas have been hit even harder, and some 
Gulf Coast towns oil and gas, fishing and tourism are all they 
have, and now they don't have any of those three. I am afraid 
this spill is going to have a lasting negative impact on 
communities beyond the environmental implications for years to 
come with so much money being removed from the system. The 
economy is already hard hit. We will struggle to bounce back.
    It will be important for us to help those communities. One 
way this can be accomplished is by fixing misconceptions that 
lead the potential tourists to believe that the entire Gulf 
Coast has been marred and cannot be visited again. I see it all 
the time on the news. There are white beaches, and the water is 
clean, so hopefully people who are watching this will know they 
can spend their vacation along the Gulf Coast.
    I am pleased that our expert panel has given time today to 
be here, and I look forward to the hearing. Again, Mr. 
Chairman, thank you for calling this hearing.
    I yield back my time.
    Mr. Rush. Mr. Latta is recognized for 1 minute.

OPENING STATEMENT OF HON. ROBERT E. LATTA, A REPRESENTATIVE IN 
                CONGRESS FROM THE STATE OF OHIO

    Mr. Latta. Well, thank you, Mr. Chairman, Ranking Member 
Whitfield. I believe this is a very important hearing today as 
we examine the devastating impacts that the Deepwater Horizon 
oil disaster has had on the Gulf Coast tourism.
    I recently toured the area around Grand Isle, Louisiana, 
and saw firsthand the devastation of the region and its 
economic impact on the people who work and live there. This 
area of the country is one that relies heavily on its fishing 
and tourism industries, and I am looking forward to hearing 
from today's witnesses and their perspective on the disaster.
    I especially look forward to Mr. Feinberg's testimony and 
questions he may answer as to the Administration's platform for 
the handling and distribution of the $20 billion escrow account 
to compensate victims of the oil spill.
    As disaster cleanup continues, we need to make sure funds 
are handled properly and in a timely manner, and it gets to the 
appropriate individuals that need that assistance.
    And with that, Mr. Chairman, I yield back.
    Mr. Rush. Ms. Sutton is recognized for 1 minute.

  OPENING STATEMENT OF HON. BETTY SUTTON, A REPRESENTATIVE IN 
                CONGRESS FROM THE STATE OF OHIO

    Ms. Sutton. I thank the distinguished Chairman for holding 
this hearing.
    Over the last few months we have heard from BP and other 
companies involved in the Deepwater Horizon disaster and 
Administration officials about how this tragedy occurred and 
how we can prevent it from happening again, and at one of those 
early hearings I asked Lamar McKay, the President and Chairman 
of BP America, if BP would consider the loss of profits for 
fishing and tourism as a legitimate claim, and Mr. McKay 
replied, yes, and that was a good development after BP's 
reckless actions. Their culture of carelessness caused the 
devastation of our waters and coasts and wildlife and injured 
countless businessmen and the tourism industry.
    And the losses to these businesses, of course, have had 
ripple affects throughout our economy, and we have heard some 
of that detailed here today where people from places beyond the 
Coast are feeling the effects of loss of tourism. I am 
interested in hearing the testimony today from the witnesses 
about how the Gulf Coast Claims Facility has been processing 
the claims coming in and if this process can be improved.
    Thank you, and I yield back.
    Mr. Rush. Dr. Gingrey is recognized for 1 minute.

  OPENING STATEMENT OF HON. PHIL GINGREY, A REPRESENTATIVE IN 
               CONGRESS FROM THE STATE OF GEORGIA

    Mr. Gingrey. Chairman Rush, thank you for calling today's 
hearing on the impact that the Deepwater Horizon explosion has 
had on tourism in the Gulf Region. As a member of the 
Subcommittee on Oversight and Investigation, I have had the 
opportunity to hear testimony on a range of matters relating to 
Deepwater Horizon. I look forward to hearing from today's panel 
of witnesses.
    Due to the importance that tourism has for the economy in 
the Gulf, it is critically important that we use today's 
hearing to assess the devastating impact that the oil spill 
will have on approximately 46 percent of the region's economy 
at a time when unemployment across the country is 9.5 percent, 
further impact the tourism industry in the region, will only 
exacerbate those economic woes.
    Mr. Chairman, this downturn will not only affect the areas 
directly hit by the oil spill, but it will also affect areas 
where the coastline and water are still pristine. Therefore, we 
must strike a balance within the funds being handled by the 
Gulf Coast Claims Facility under Mr. Feinberg's administration.
    In particular, based on his earlier testimony at the Small 
Business Committee, I look forward to hearing from Mr. Feinberg 
in particular on the challenges facing the Gulf Coast tourism 
in the aftermath of Deepwater Horizon, and I thank all of you 
gentlemen who are actively involved in tourism industry. You 
know of what you speak. We look forward to hearing from you 
today.
    And, Mr. Chairman, I yield back. Thank you.
    Mr. Rush. Mr. Barrow of Georgia is recognized for 1 minute.
    Mr. Barrow. I waive opening.
    Mr. Rush. Thank you. The Chair now recognizes Mr. Scalise 
of Louisiana for 1 minute.

 OPENING STATEMENT OF HON. STEVE SCALISE, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF LOUISIANA

    Mr. Scalise. Thank you, Mr. Chairman and Ranking Member 
Whitfield, for having this important hearing on the oil spill's 
affect on tourism in the Gulf Coast. I want to start by 
welcoming a dear friend and a respected business leader from 
New Orleans, Ralph Brennan. Not only respected in Louisiana but 
as former head of the National Restaurant Association, an 
authority on restaurants, tourism, and business, and I 
appreciate him coming and look forward to hearing his comments.
    And as my colleagues have pointed out, the tourism 
industry, including restaurants like Mr. Brennan's, is 
suffering from the effects of the oil spill. An industry that 
employs over one million people along the Gulf Coast and brings 
in approximately $39 billion in annual tax receipts is now 
facing double-digit declines due to this disaster. A national 
survey done in May by the Louisiana Office of Tourism found 
that 26 percent of those who had plans to visit Louisiana had 
postponed or canceled their trip, while a June survey focused 
on nearby visitors along the Gulf Coast States found similar 
results.
    That is why it is so critical that the recovery fund being 
run by Mr. Feinberg is administered in a way that helps all of 
those that are being affected and will be affected by this 
disaster.
    And finally, Mr. Chairman, it is critical that the Federal 
Government does not add to the problems that we are facing 
along the Gulf Coast, and it is critical that the President end 
this irresponsible moratorium on offshore drilling. As people 
in Louisiana continue to fight the oil each day, President 
Obama and his Administration are taking what is already a human 
and environmental tragedy and turning it into an economic 
tragedy by continuing to pursue this reckless moratorium.
    Mr. Chairman, the economy in my State and others along the 
Gulf Coast are already suffering. The Federal Government's role 
is to help and not hurt our recovery. I look forward to hearing 
from our panelists.
    Thank you, and I yield back.
    Mr. Rush. Mr. Gonzalez from Texas is recognized for 1 
minute.
    Mr. Gonzalez. Waive opening.
    Mr. Rush. The Chair thanks the gentleman. Is there any 
other member? The Chair don't see any--does not see any other 
members seeking recognition.
    Now, the Chair has a unanimous consent request before the 
committee. Mr. Melancon and Mr. Burgess can sit on the panel 
and ask questions. I don't see either of them here. If, in 
fact, they do appear, then hearing no objection if and when 
they do appear, they will be allowed to sit on the panel and 
ask questions of the witnesses.
    The Chair also asks for unanimous consent to insert into 
the record a statement from the Northwest Florida Tourist 
Development Council. Hearing no objections, so ordered.
    [The information appears at the conclusion of the hearing.]
    Mr. Rush. Now it is my pleasure and my privilege to 
recognize and introduce the witnesses that will appear before 
us today, and beginning on my left, a name that is not 
unfamiliar with those who are here in this Congress, Mr. Ken 
Feinberg. He is the Administrator for the Gulf Coast Claims 
Facility. He is on my far left.
    Seated next to him is Mr. Roger Dow, who is the President 
and CEO of the U.S. Travel Association. Seated next to Mr. Dow 
is Mr. Rip Daniels. He is the CEO and Manager of WJZD-FM. He is 
also the Vice-President of the Mississippi Gulf Coast Tourism 
Commission.
    Next to Mr. Daniels is Mr. Herb Malone. He is the President 
and CEO of the Alabama Gulf Coast Convention and Business 
Bureau. Seated next to Mr. Malone is Mr. Keith Overton, and Mr. 
Overton is the Senior Vice-President and Chief Operating 
Officer of Tradewinds--of the Tradewinds Resort. He is also the 
Chairman of the Florida Restaurant and Lodging Association. And 
then we have Mr. Brennan, Mr. Ralph O. Brennan, who is the 
President of the Ralph Brennan Restaurant Group, LLC.
    Again, I want to thank the witnesses for appearing in 
response to our request and our invitation. It is the practice 
of this subcommittee to swear in witnesses, so I will ask if 
you will stand and raise your right hand.
    [Witnesses sworn.]
    Mr. Rush. Please let the record reflect that the witnesses 
have all in their entirety answered in the affirmative. And now 
we will recognize Mr. Feinberg for 5 minutes for opening 
statement.

TESTIMONY OF KENNETH FEINBERG, ADMINISTRATOR, GULF COAST CLAIMS 
      FACILITY; ROGER DOW, PRESIDENT AND CEO, U.S. TRAVEL 
ASSOCIATION; RIP DANIELS, CEO/MANAGER, WJZD-FM, VICE PRESIDENT, 
    MISSISSIPPI GULF COAST TOURISM COMMISSION; HERB MALONE, 
 PRESIDENT AND CEO, ALABAMA GULF COAST CONVENTION AND VISITORS 
    BUREAU; KEITH OVERTON, SENIOR VICE PRESIDENT AND CHIEF 
  OPERATING OFFICER, TRADEWINDS RESORT, AND CHAIRMAN, FLORIDA 
   RESTAURANT AND LODGING ASSOCIATION; AND RALPH O. BRENNAN, 
         PRESIDENT, RALPH BRENNAN RESTAURANT GROUP, LLC

                 TESTIMONY OF KENNETH FEINBERG

    Mr. Feinberg. Thank you, Mr. Chairman. I thank the 
subcommittee for the opportunity to testify. It is the fourth 
time I have testified in the last 2 weeks in the Congress, 
three times on the House side and once on the Senate side, and 
I am here again to answer any questions that the members may 
have.
    I am the independent administrator of this new Gulf Coast 
Claims Facility set up by agreement between the Administration 
and BP. I do not work for the Administration. I do not work for 
BP. I have been delegated the authority to design, implement, 
and administer this purely private facility funded by BP in a 
$20 billion escrow account.
    I have been assured by both the Administration and BP that 
this facility that I am administering will, in fact, be totally 
independent. I answer to the people in the Gulf, not to the 
Administration nor to BP. BP has--is setting aside $20 billion 
in an escrow fund to pay all eligible claims that are submitted 
to the facility. Hopefully the $20 billion will be enough. If 
not, BP has agreed that it will honor any additional financial 
obligations that it may have over and above the $20 billion.
    I am now in the process, as you know, of establishing this 
facility. It is not yet up and running. It will be up and 
running next month, in a few weeks, and we will assume all 
responsibility from BP for processing private claims of 
individuals and businesses. I do not have any jurisdiction over 
government claims, state, local, or federal. None. I also have 
no jurisdiction over the moratorium claims for the rig workers, 
the $100 million set aside by BP for moratorium rig workers 
that is not part of the $20 billion and is being administered, 
as I understand it, separately.
    I want to give BP some credit. It has already paid over 
$230 million worth of claims, not out of the $20 billion but as 
part of its petty cash. It has paid out $230 billion in 
individual and some business claims. When I said--somebody--
Congressman Stearns, I think, reminded me about stalling. BP 
has not been paying certain problematic claims for the reasons 
really expressed by Congressman Stearns.
    I mean, what constitutes an eligible claim is a major 
question here, and it is going to be a major question today 
when it comes to tourism. It is easy to compensate a motel or a 
restaurant on the beach where there is oil. You don't need the 
wisdom of Solomon for that claim. You really don't. You don't 
need the wisdom of Solomon for a claim involving a motel on the 
beach where the beach is pristine but you can't fish. That is 
an easy claim.
    Proximity is going to be the problem here. Proximity. How 
far from the beach does a steakhouse that has lost 30 percent 
of its business because of a downswing in tourism is precisely 
the question posed by Congressman Stearns. What constitutes and 
eligible tourist claim?
    Now, I have got some great help on that from Mr. Malone 
from Alabama, who I have met with on a couple of occasions, who 
is thinking this problem through from the perspective of 
tourism in Alabama. Governor Crist in Florida has reminded me 
about the Pan Handle and the influence of this disaster on a--
on the Florida coast, but what I am going to have to decide, 
you see, as part of this Gulf Coast Claims Facility is what 
constitutes a direct claim, a direct claim, that is immediately 
payable, and how far attenuated may a claim be from the spill. 
The overall impact of the spill undoubtedly impacts tourism 
throughout a particular state. I am sure of that.
    The question is what constitutes an eligible claim, and 
what is required to be proven in advancing that calculation in 
order to get money from this facility. I am as interested as 
the members are in hearing from the--my fellow witnesses today. 
Maybe I will come up with some additional ideas that Mr. Malone 
has already advanced for my consideration in terms of trying to 
come up with a fair, equitable, just way to determine 
eligibility and to determine what the appropriate compensation 
should be.
    I look forward to the testimony of my other fellow 
witnesses. I look forward to working with this committee. There 
are some members here who I have already been working with over 
the past few weeks, and I look forward to continuing to work 
with Congresswoman Castor and others, Congressman from 
Louisiana also. I have been meeting with them. I return to 
Florida tomorrow. I will be in Mississippi and Alabama on 
Friday and will be returning to Florida again--and Louisiana in 
the next 2 weeks.
    So you can't do this from Washington. You have to spend a 
lot of time down there, hearing what people have to say, the 
uncertainty, the concern, and I really look forward to working 
with this committee in the months and weeks ahead.
    Thank you.
    [The prepared statement of Mr. Feinberg follows:]
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    Mr. Rush. Mr. Dow, you are recognized for 5 minutes.

                     TESTIMONY OF ROGER DOW

    Mr. Dow. Thank you, Mr. Chairman, and thank you, Ranking 
Member Whitfield, and the members of the committee that are 
present. It is an honor to be here today, and I have already 
submitted and will submit my testimony for the record, but I 
would like to be brief.
    To give you an idea, the U.S. Travel Association I 
represent is basically--represents the whole $704 billion 
travel industry or one of nine Americans employed. Our 2,000 
members represent all the airlines, hotels, lodging companies, 
attractions, et cetera, and our mission is real simple, and 
that is to promote travel and increase travel to and within the 
United States that creates American jobs.
    During the current environmental crisis that mission 
couldn't be more important. In my testimony I am going to 
highlight several things. One, the significance of the impact 
of travel and tourism which you have already heard from 
distinguished members of the panel, and you will hear from the 
panel and also from the committee state but also the potential 
long term of the oil spill, the damages and what BP and the 
Federal Government can do.
    It is mentioned that four States are impacted to the tune 
of $94 billion of their travel economy and a million employees 
in their travel economy, but you also have Texas, which 
perception has not been hit as hard but perception can cause 
people not to go to parts of Texas, and that is even a bigger 
place.
    When you look at tourism, it has a much larger portion in 
the Gulf Region than many--any other region in the country. 
Fifteen percent of private employees are in this industry in 
the Gulf Region versus other areas. When you really look at how 
many people, the question is who is harmed, as Mr. Feinberg 
said well, and how long I think are very important questions.
    We commissioned Oxford Economics, one of the most respected 
economics firms in the globe, to take a look because we have 
got to deal with facts as Mr. Feinberg so rightly says, not 
hearsay, and we commissioned them to look at 25 national 
disasters around the world; hurricanes, tsunamis, earthquakes, 
oil spills, pandemics, and take a look at what would happen and 
the facts of data of how long it took them to recover.
    Well, as you have already heard stated, Katrina 5 years 
later, New Orleans hadn't recovered from pre-Katrina numbers. 
Oxford Economics estimates that the damage is going to be 
probably $22.7 billion. That is just to the travel and tourism 
industry, over 3 years.
    What I want to talk about today is that cost can be reduced 
significantly by up to a third or $7.6 billion. We have 
submitted the Oxford Economic study, and we have also submitted 
a roadmap to recovery with concrete ideas how to mitigate the 
damages so we can lessen them for the taxpayers and lessen them 
for BP. Using travel to stimulate the economy and speed the 
recovery.
    And it is three parts. One is to inform the perception, and 
we all know how important perception is. Second, create an 
incentive for people to travel back to this area. Third, to 
make businesses and people whole, and this must be funded by BP 
to help reduce the long-term implications.
    A key lever that is available to BP and the Federal 
Government is the opportunity to create marketing to bring 
people back. We are asking that it be considered a $500 million 
fund, which would be a 15 to one return or $7.5 billion to 
bring people back. Mr. Feinberg has the challenge of assessing 
real damages, but the challenge is, if left untouched these 
damages will mount and will grow. We have an opportunity to 
shrink them, and we need to address that. And so with no 
guidance for recovery, we don't know how to submit the claim. 
So that is going to be important.
    We believe that the Gulf Coast Claims Facility is the right 
and only area to take $500 million and properly allocate it to 
the people that can make a difference. There have been many 
requests by states, and they have received as you have already 
said $70 million. The unfortunate problem is of that $70 
million very little actually got to marketing.
    We would like to remove the politics. We would like to 
remove special interests. We would like to get a transparent 
process where we can mitigate and pull this down. The damage 
has already occurred. Everyone is talking about capping the 
damages and capping the well. Well, we also need to cap the 
damages long term, and we can do that.
    The 400,000 people that work in this industry know how to 
do things in this industry. They probably don't know how to 
file a claim. So we need to get them back more quickly. A $500 
million marketing effort will do that. We have seen that over 
and over. We saw that with SARS in Canada. We have watched for 
98 days on television the problems. We can turn this around, we 
can mitigate it. Nothing is more important than getting a fund 
to do this, put it in place, and I believe that will help the 
communities, the families, and the taxpayers, and in the long 
term reduce the liability for BP.
    Thank you very much.
    [The prepared statement of Mr. Dow follows:]
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    Mr. Rush. The Chair recognizes now Mr. Daniels for 5 
minutes.

                    TESTIMONY OF RIP DANIELS

    Mr. Daniels. Thank you, Chairman Rush, Ranking Member 
Whitfield, and other subcommittee members. I am representing 
myself today.
    Mr. Rush. Would you turn the mike on and pull it closer to 
you? Thank you.
    Mr. Daniels. I apologize for that. I am representing myself 
as a private citizen and not the Harrison County Tourism 
Commission primarily because I wanted to represent small 
business as well as it applies to tourism.
    I have been in tourism since 1978, starting as a tavern 
owner, radio broadcaster, real estate broker, tourism 
commissioner, and the primary investor in the Coast's newest 
African-American hotel, the Almanett. I have seen firsthand the 
adverse effects of a range of disasters from Hurricane 
Camille's destruction on the seafood industry's processing in 
1969, to the economic recession of the '80s which resulted in 
the closing of the Hilton and Sheraton hotels, the complete 
destruction of the Coast tourism destination by Hurricane 
Katrina.
    However, I have also been a part of the recovery and 
renewal of the Coast after each calamity, and the resilience of 
the Gulf Coastians in the face of insurmountable destruction is 
a testament to their faith in God and in each other.
    On the eve of the 5-year anniversary of Hurricane Katrina, 
the Coast was poised to have a banner year for tourism. On 
April 20, the Deepwater Horizon sunk and so did our hopes to 
finally reestablish the Mississippi Gulf Coast as a tourist 
destination as opposed to a hurricane-ravished resort.
    The impact of the BP oil disaster on tourism has been and 
will be a disaster. The devastation is difficult to measure 
because both the actual damage and the perception of the damage 
cannot be readily measured. Was the Gulf Coast spared because 
there was a limited amount of oil to reach the shoreline, or 
was the shoreline spared because most of the oil is still at 
the bottom of the Gulf or dispersed in plumes? Is the 
perception of clean beaches better than the perception of clean 
seafood? And in the words of my grandson, ``Is it safe to go in 
the water? And if not, is it safe to eat the fish?''
    One can glean that the Mississippi Gulf Coast billion 
dollar tourism industry is undoubtedly tied to seafood. 
According to recent Harrison County surveys the number one 
reason for visiting the Mississippi Gulf Coast was the food, 
the seafood. Ladies and Gentleman, the Coastal view is still 
gorgeous. The beaches are clean, the sound and the bayous are 
open for fishing, but the seafood; is it safe? How does the 
Coast remove the perception that it is not?
    Surprisingly, according to the hotel/motel association and 
the casino association, hotel stays over the last 90 days have 
been up, and casino revenues have been up, but of course, that 
is compared to last year when the tourism economy was at an 
all-time low. Yet, maybe the fact that the Harrison County 
Tourism Commission under my guidance investing $650 billion in 
advertising did help at least with drive-in markets.
    Hotel/motel association stats have shown that many of the 
room nights are as a result of extended stay, BP employees, 
government agencies, media, petroleum-clean-up-related 
businesses, and the like. Although there is a perception at 
times that the Gulf Coast revenue is up, is it the result of 
tourism, or is it a result of oil recovery? And if so, does 
that not suggest that the recovery is not over until tourism is 
back to the ratio that existed prior to the explosion?
    The most serious adverse effect over the last--over the 
lack of tourism, not recovery workers, is that many of the Mom 
and Pop shops, the restaurants, off boats, seafood merchants, 
water sports vendors, and golf courses and the like have 
suffered. They are not getting tourist dollars which were far 
greater.
    And then even more importantly, we have notice that 
inquiries about future visits to the Coast as it applies to 
tourism is off 40 to 50 percent. What happens when all the 
recovery money is gone, and all the workers have gone?
    Ironically, just as the Deepwater Horizon was an 
exploratory mission, Mississippi Gulf Coast now finds itself 
challenged with the exploration of what to do in the coming 
years to fight the perception. There are too many unknowns 
right now. Considering the fact that we just had Bonnie, one 
has to wonder just what will happen when there is another 
Katrina or another hurricane and just how many tar balls will 
be washed up.
    Ladies and gentlemen, on the Mississippi Gulf Coast as it 
applies to tourism, we are not enthusiastic about trading a $1 
billion seafood industry for a $1 million well. So we would 
hope and in my testimony you will see some recommendations and 
hopefully some cures for this ill.
    Thank you.
    [The prepared statement of Mr. Daniels follows:]
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    Mr. Rush. The Chair recognizes Mr. Malone for 5 minutes.

                    TESTIMONY OF HERB MALONE

    Mr. Malone. Good morning, Mr. Chairman, and thank you and 
thank the members of the subcommittee for inviting us here 
today. It is a tremendous honor to represent our area. It is an 
honor to represent the some 2,000----
    Mr. Rush. Move the mic to you. Thank you.
    Mr. Malone. OK. It is an honor to represent some 2,000 
business owners and some 40,000 employees that they employ 
whose livelihoods all are at risk as we sit here today.
    Our area began receiving oil on our beach in mid May. We 
have continued to receive it, have some sheen offshore, coming 
ashore today as we speak. This is our high season. With the oil 
impacts we have had it is--I cannot describe it verbally as 
well it should be. Many of us have had problems with the media 
and the way that the media has overstated things, which 
sometimes they tend to do, but I will tell you honestly when 
the media in the second week of June reported that the beaches 
of Alabama were slathered with oil, we were slathered with oil, 
and it was not a false report. They failed to report how much 
is being cleaned up. Our beaches do look good today, and there 
is a clean-up process. It took awhile to get it working, but it 
is working.
    What has this done to our tourism economy is destroyed it. 
We are devastated. We should be at 90, 85 to 90 percent 
occupancy today in mid-July and late July. We are running less 
than 30 percent, and when occupancy goes down, the rates go 
down even greater. So our revenue to our lodging, to our 
restaurants, to everyone in town, I don't know of a single 
business, and I conveyed this to Mr. Feinberg in a recent 
meeting, I don't know of a single business in our town that has 
not been directly affected by this oil. It has created a sense 
of despair that I have never seen.
    Like Mr. Daniels, I have grown up on the Gulf Coast. I have 
been through hurricanes. We have been through hurricanes. I 
have been in this position for 22 years. I look at the eyes of 
my friends and colleagues around the community, and I see 
despair I have never seen before.
    We mentioned and remembered 11 victims of the explosion of 
the rig. We have got a 12th victim. We have got a charter boat 
captain, Captain Alan Cruise, who in the sense of despair, 
beyond hope, took his own life. We hope that is the last one. 
We have measures in place to try to prevent that from happening 
again. We hope we are successful with those.
    We are the smallest beach, laterally we are the smallest 
beach on the Gulf Coast. We have the least amount of coastline 
of any of the five States, but we generate $2.3 billion 
annually from our tourism product. We the decline that we see 
in this high season, we fully expect our loss to be at or near 
$1 billion just this year, not counting what happens in the 
summer, I mean, in the future years. And that is the direct 
spending by the consumer, not counting the ripple affect as it 
would ripple through our economy.
    So it is devastating to us. It is about survival. The BP 
claims process has been mentioned in the numbers that they seem 
to tout quite often of what they have paid. The bigger number 
is what they have not paid. Last night I received an e-mail 
from one of our local CPA firms that I know has been very 
actively engaged in the claims process. They have filed over--
gave me a detailed list of over 70 claims they have filed on 
behalf of businesses. These 70 claims total over $27 million. 
This is just for May and June. July claims are just now 
starting to be filed. Of that $27 million less than $5 million 
has been paid yet to owners. Of that $5 million, $3.5 million 
went to two claims.
    So as you see there is a tremendous void in what has been 
filed and what has been requested and what has been documented, 
and this CPA firm is highly reputable. They have been actively 
engaged from the very beginning, and they like the rest of us, 
are being frustrated why money is not coming into the hands of 
our business community. Without that they can't support the 
jobs, they can't make payroll next week, they can't pay the 
notes that are due.
    Our industry is much like farmers. We prepare in the 
spring, we market, we spruce up the place, we paint the boat, 
we remodel during the winter, we are ready for the coming 
season. Just like the farmer who has lost his crop, we have 
lost our yield. So is it--not only is it a terrible time in 
regards to the recession and the previous hurricanes, it is a 
terrible time of year for us.
    So our request to you today is this committee, subcommittee 
and members of Congress is to do, please, whatever you can to 
get money in the hands of Mr. Feinberg and his program and get 
it up and going as fast as possible. We have had two meetings 
with Mr. Feinberg. We have found him to be very fair and open-
minded. Our first meeting he scared us with his eligibility 
requirements, but in our second meeting he listened to our side 
of the case, and he said we closed the gap tremendously with 
him. We still have some work to do, Mr. Feinberg, but we are 
feeling better about it, and we look forward to working with 
him.
    But our problem is I have businesses who have bank notes 
due last week. Every day that goes by is critical. Every week 
that goes by there will be another foreclosure. So when Mr. 
Feinberg says he is taking over mid next month, I wish for us 
he would take over tomorrow, and if there is any way that 
members of this committee or any other members of Congress can 
help facilitate getting this into the control of Mr. Feinberg 
and out of the control of BP, it would be a tremendous benefit 
to us.
    With that I would like to close over than to say, again, 
thank you for your interest in this issue. Thank you to the 
gentleman who recognized our Jimmy Buffett concert. Thank you 
to the lady from Florida who discussed the beautiful beaches. 
We share the same beautiful beaches with Florida. At least we 
did before the oil. We look forward to the day those beaches 
are beautiful once again.
    [The prepared statement of Mr. Malone follows:]
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    Mr. Rush. Thank you. Mr. Overton, you are recognized for 5 
minutes.

                   TESTIMONY OF KEITH OVERTON

    Mr. Overton. Thank you, Mr. Chairman, and distinguished 
subcommittee members. For the record we, too, are a little 
frightened of Mr. Feinberg so far, but I think we are going to 
get through it OK as we have more discussion.
    Florida is the vacation capital of the country, and it has 
been for generations. When visitors think of Florida, they 
envision warm sunshine, blue waters, sugary white sand beaches, 
fresh seafood, and the natural environment like no other. All 
of these wonderful characteristics have been damaged as a 
result of the perceptions that Florida's beaches are covered in 
oil.
    Tourism is big business. It is our number one industry. We 
hosted over 80 million visitors in 2009. We captured nearly 17 
vacations from Floridians--17 million vacations from 
Floridians. Collectively our visitors spent over $60 billion on 
travel last year, generating nearly $4 billion in sales tax 
collections.
    What that means is more than one-fifth of Florida's sales 
tax dollars are paid by visitors, and it also means jobs. 
Nearly 1 million Floridians are directly employed in travel and 
tourism.
    To give you an example of the economic impact the BP oil 
spill is having on hotels, let me give you some statistics from 
my hotel, the Tradewinds. For purposes of geographic reference, 
we are the largest resort on the West Coast of Florida, just 
west of Tampa Bay, located in Pinellas County. Call volume is 
down by as much as 25 percent. We have 800 of the county's 
approximate 35,000 hotel rooms. So when you take an average of 
the last 3 years, which is what BP is asking us for, of our 
revenues shortfalls and you compare that to the revenue that we 
have achieved since the oil spill, we are down approximately 
$1.7 million.
    Now, if you extrapolate that out and you assume the balance 
of Pinellas County's 35,000 rooms have had a similar impact, 
that is a $70 million economic loss just in hotel room revenue, 
and that doesn't include restaurants or secondary businesses 
related to tourism.
    And then if you think about the Pan Handle, which has 
76,000 hotel rooms in its entirety and the effects clearly have 
been more devastating to them than they have in Pinellas 
County, it is easy to see that the losses to Florida's tourism 
are in the billions. It is a substantial number, and it is 
something that we want to make on the record today that we need 
help with that.
    What is most concerning to me is that all of these losses 
have occurred to our resorts without a drop of oil being on any 
beach in Pinellas County. It is amazing to me how the 
perceptions of the media have gotten us to this point. 
Nonetheless, we are there.
    I also want to share with you that the Y-Partnership 
conducted a survey on June 18, and it was asked at the time of 
the participants which States do you believe will most directly 
be impacted by oil. Ninety-five percent of them put Florida at 
the top of the list. Florida is clearly the least affected 
State, at least physically, from the oil that is impacted the 
shorelines.
    So clearly, again, I want to restate this is a perception 
problem, and I certainly think we can all agree that 
perceptions have worsened since June 18.
    Prior to appearing on Neil Cavuto show a couple of weeks 
ago, I was viewing a monitor, and it had the President who was 
appearing at Pensacola Beach, and at the time there were a few 
tar balls there, but it hadn't been materially affected. And 
the tickertape along the bottom, I couldn't hear what was being 
said, but it read, ``Oil finally reaches Florida's beaches.'' 
Plural. And when they transitioned to the next shot, the 
television station, and I can't recall which one it was, 
superimposed the oil running down the screen behind the 
President over the beautiful Gulf waters that were behind him. 
And I said to myself, you know, $25 million, $50 million, $100 
million, there is no amount of money that is going to combat 
that kind of imagery, and it is a challenge that we are faced 
with, and it is going to be there for many, many years to come 
I believe. Much like what happened in the hurricanes of 2004. 
We are still suffering from that and cannot gain occupancies in 
August and September that we used to achieve.
    I have five requests of the committee in closing if you 
would acknowledge them, and I would ask you to at least address 
them in your comments and your questions. One is the media must 
be held accountable to accurate and fair reporting of the facts 
regarding this oil spill. They have a legal and an ethical 
responsibility to do so, yet many of them continue to put 
ratings ahead of accuracy.
    I urge you to charge some agency, maybe it is this 
governing body, I am not sure, within the Federal Government to 
review news reports weekly and hold them accountable for the 
sensationalism and the accuracies that are there. We need 
somebody to support us in that regard, or it will just continue 
on even with the next crisis beyond this one.
    Number two. We are optimistic that the oil leak has been 
capped, however, there is still going to be years of cleanup 
and recovery efforts remaining. We all fear that the claims are 
going to cease being paid prior to the end of the actual 
losses. I think that is an accepted concept today.
    Additionally, Mr. Feinberg's recent comments with regards 
to what is a compensable or legitimate claim based on whether 
or not oil is on its beaches and the proximity to that oil is 
also very concerning to all of our members and all of the 
tourist-based businesses within Florida, and we implore Mr. 
Feinberg and any branch of the government that can influence 
the claim process to look very carefully at this and not allow 
it to be a black and white issue. We want to make sure each 
business owner has an opportunity to be heard for their 
legitimacy of their claims and not just ruled out because of 
geographics.
    Third, I would like to make you aware that the CVBs in all 
of the Gulf Coast counties rely on bed tax dollars, and those 
bed tax dollars are related to hotel room revenues. When they 
fall, revenues fall, then the bed tax dollars fall. We need 
that marketing money. We need to be made whole. I know that is 
not Mr. Feinberg's responsibility, but those CVBs need to made 
whole on the dollars that have been lost for their marketing 
purposes.
    The fishing and seafood industry and our wildlife are 
critical to tourism and Florida's economy. I am not going to go 
into the details, but I have included in your packet some 
recommendations from very legitimate ocean conservancy, other 
agencies that will help you in some of your studies as it 
relates to our wildlife.
    And lastly, we have to continue to spend money on marketing 
efforts both domestically and internationally. We have not yet 
gotten more money past the $25 million originally that BP has 
given to us. Fifty million dollars was requested by our 
governor, and it has been turned down. We really need that 
money. It is very important. This is going to go on for a long 
period of time as I said earlier, and those dollars are vital 
to our recovery.
    I thank you very much for allowing me to speak today and 
giving you our testimony.
    [The prepared statement of Mr. Overton follows:]
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    Mr. Rush. Mr. Brennan, you are recognized for 5 minutes.

                 TESTIMONY OF RALPH O. BRENNAN

    Mr. Brennan. Thank you very much, Mr. Chairman, and thank 
you for this opportunity to testify on behalf of the National 
Restaurant Association and the restaurant industry. As you said 
in my introduction, I am from the Ralph Brennan Restaurant 
Group, and I have been involved in the restaurant industry in 
New Orleans for almost 30 years, and my family has been in the 
restaurant business for more than 60 years, and as a group we 
operate 12 restaurants, nine of those in New Orleans. And Gulf 
seafood is an important ingredient in all of our menus.
    I want to thank you for holding this hearing and for your 
continuous focus on the oil spill's impact on the economy of 
the Gulf Region and the Nation, and I appreciate the 
opportunity to tell the restaurant industry's part of the 
story.
    Ours is an industry that employs an estimated 2.3 million 
employees in the Gulf Coast Region. Restaurants in the Gulf 
Coast area generate about $77 billion in annual sales.
    Since April 20 when oil began flowing into the Gulf of 
Mexico, our coastline, our sea life, our culture and our 
tourism economy are again in great jeopardy. After Hurricane 
Katrina roared ashore on August the 29th, 2005, Gulf Coast 
residents and businesses essentially knew what to do to return 
to normal or as we call it today the new normal. The water came 
into New Orleans, the water went out, and we began to rebuild 
and move on. But this is not the case today.
    The key message that I want to share with you is one of 
long-term uncertainty impacting both the ecosystem of the Gulf 
and the economy of the Gulf Coast area and potentially 
devastating tourism in the Gulf States.
    Across the affected areas restaurants report a range of 
experiences. Those located in seaside or in beach communities 
are decimated as tourism shrivels. Tourists are not coming 
because there is either oil on the beach or in the water, or 
people have the perception that there is oil there, and visitor 
perception is key to decisions about where to vacation. The 
overall numbers of tourists are down, restaurant guests and 
sales are decreasing, product costs are increasing, and jobs 
are in jeopardy as already thin margins precariously slip away.
    In New Orleans one of the driving forces of our economy is 
culinary tourism and Gulf seafood is at the heart of our 
culinary tourism. Like we saw after Hurricane Katrina, 
convention groups and leisure travelers are now calling to 
express concern about upcoming business and whether to book 
future business. Many are asking if oil is on the doorsteps in 
New Orleans, and New Orleans is miles inland. Today almost 5 
years after Hurricane Katrina convention bookings have not 
returned to pre-Katrina levels because of the damage to the New 
Orleans brand, and the oil spill risks surrendering the ground 
that we have gained over the last few years along with future 
increases.
    While the focus of my testimony is not primarily on the BP 
claims process, I have heard from some of our restaurant 
association executives along the Gulf that there is a 
willingness to set up a claims center and that would be solely 
focused on the restaurant and hotel industries, and I want to 
voice my strong support for that idea.
    Regarding my three New Orleans restaurants specifically, 
sales are down, counts are down, costs are up, and margins are 
down, and this is not a sustainable business model and as the 
oil looms offshore with an impact that could last for many 
years to come.
    With regard to perceptions and misconceptions, I would like 
to begin applauding our state and federal officials for the 
stringent safety testing of Gulf seafood that has allowed 
truthful reporting around the potential toxicity of the 
seafood. We are fortunate that 100 percent of the reports to 
date have shown that Gulf seafood is to be safe to consume from 
areas that are approved. Ongoing testing is crucial for a safe 
and informed public.
    Despite the testing concerns about safety and supply, one 
of the recent national polls indicated that 54 percent of the 
respondents said they would only eat seafood that they know 
does not come from the Gulf. Our staff has received many calls 
and comments, all centered around safety and supply. And to 
combat concerns we have aggressively trained our staff to 
knowledgeably share precise locations of where our seafood 
comes from.
    To demonstrate support for the fishermen and the safety of 
the product, my restaurants have added seafood offerings. As I 
told the ``New York Times,'' the way to help is to eat Gulf 
seafood. If high-profile individuals, including celebrities, 
celebrity chefs, and even members of Congress could be seen 
eating a Gulf shrimp po boy it would go a long way to 
alleviating consumer fear. The Obama family's visit to Florida 
beaches next month is a welcome opportunity, again, for 
positive reinforcement, and I know the National Restaurant 
Association is looking to plan some of its meetings in the Gulf 
Coast Region, and I would hope that trade associations and even 
government agencies would do the same.
    Despite a curb in the demand for Gulf seafood, prices 
across the board have increased. On average in my restaurants 
we are paying 18 to 30 percent more for the seafood that we 
serve.
    Finally, I would like to comment on the long-term impact of 
a misinformed public. In the years after Hurricane Katrina 
potential visitors from around the country thought that the 
city of New Orleans was still under water, that the drinking 
water was unsafe, and there were no hospitals or other city 
services. These misperceptions were largely created and 
reinforced by the media because of the regular replaying of 
images from days after the storm.
    Many in New Orleans feel it was only after the New Orleans 
Saints and the city of New Orleans hosted two playoff games 
back in January, and the Saints went on to win the Super Bowl 
that those misperceptions were finally ceased.
    Misperceptions are happening again now. Just about every 
day a story is reported live from New Orleans on the spill. The 
perception shaped by the media, even if unintentional, is that 
oil is on the doorsteps of New Orleans. That is 
sensationalistic and untrue, yet if reporting from these 
locales continues, the public will continue to draw its own 
conclusions and perceive New Orleans and many of the cities and 
resorts across the Gulf as damaged destinations.
    Marketing dollars will be needed to counter these 
misperceptions. The long-term consequences and impact on 
tourism of the damaged brand are severe.
    Thank you, Mr. Chairman and member of the subcommittee, for 
this opportunity to be here today.
    [The prepared statement of Mr. Brennan follows:]
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    Mr. Rush. The Chair thanks all the witnesses for their 
testimony, and the Chair recognizes himself now for 5 minutes 
of--for the purposes of questioning the witnesses.
    Mr. Feinberg, I am going to begin with you. At this moment 
BP is still processing claims I understand filed by businesses 
and workers in the Gulf Coast Region. According to your 
testimony BP has already paid $200 million in emergency 
payments. Despite these numbers we have been told that there 
are many complaints about the claim spots that BP is utilizing.
    Mr. Malone describes the process as erratic, somewhat 
convoluted, and at times dysfunctional. And also in your 
testimony you stated how complicated it is to determine whether 
the oil spill is true or the approximate cause for the damages 
that businesses are suffering, even when there is no evidence 
of oil in sight. Many of these businesses are on life support, 
and they wait on a determination of their eligibility to submit 
a claim against the $20 billion escrow, a fund that BP has 
established.
    Mr. Feinberg, I just have to ask you because I am drawn to 
the infamous and traditional Gulf Coast fisherman, Forest Gump, 
saying life is a box of chocolates. You don't know what you are 
going to get.
    Now, my question to you is when will the people of the Gulf 
Coast, the business people, the workers, when will they get 
definite answers? Mr. Dow talked about a roadmap to recovery. 
When will they get such a specific from you or someone else 
about who is eligible, why they are eligible, when they are 
going to get paid, how much they are going to get paid? These 
are just some basic questions. The guesswork needs to be in--it 
needs to come to us, the guesswork.
    And so your process that you are going through I understand 
you got to go through this process in terms of getting to a 
point of answering some of these very, very valid and important 
questions, but when is the process going to be over? When are 
you going to be able to give some clarity and eliminate the 
guesswork?
    Mr. Feinberg. I will answer that very obviously critically 
important question with three answers.
    First, I believe that the blueprint that I have established 
for emergency payments to be paid as quickly as possible should 
be finished and available this week. That is first. That is my 
goal.
    Secondly, I have no authority to fund the $20 billion 
escrow account. That is an agreement between the Administration 
and BP. My understanding is that they are working overtime to 
try and finalize the terms and conditions of that escrow 
account which will make the $20 billion available. I can't give 
you a time except to say I think it is probably within a matter 
of weeks, but I don't know. I am not privy to that escrow 
negotiation.
    Third, I suspect that I will be able to accept transition 
from BP, BP will get out of the claims business completely, the 
private claims business, and I should be up and running with 
the Gulf Coast Claims Facility the middle of next month. The 
middle of next month. A couple of weeks. And then I will assume 
all authority to process emergency claims. Emergency claims. In 
which the fishermen, the small business, the restaurant will 
not waive any rights they may have. They will simply decide if 
they are eligible, they will decide whether they want to 
participate in the program, and we will receive, if eligible 
and if they document their loss, up to 6 months of emergency 
payments to help get them over this immediate emergency.
    Now, that--Mr. Chairman, if I may just add, I understand 
from all of these witnesses and from the members of this 
committee time is of the essence. This is a huge undertaking, 
and I am working as fast as I can, as diligently as I can, full 
time to get the Gulf Coast Claims Facility up and running, to 
get it funded so that these emergency claims can be made as 
soon as possible.
    Mr. Rush. Are you considering the workers also in terms 
of--will they--the same guidelines apply to them also?
    Mr. Feinberg. The same. I think BP frankly has done a much 
better job of this $230 million they have paid out, I think 
they have done a much better job of paying out worker claims, 
shrimpmen, fishermen, oyster harvesters than they have paying 
out small business and large business claims. I think that is 
clear from the testimony I have heard today and from the CPA in 
Alabama, and I think that is absolutely true. That is one 
reason why I have got to get up and running with this facility 
as soon as I can.
    Mr. Rush. The Chair now recognizes the Ranking Member, Mr. 
Whitfield, for 5 minutes.
    Mr. Whitfield. Well, thank you again for your testimony, 
and Mr. Feinberg, I think all of us are delighted that you will 
truly be independent, you are not reporting to anyone. I think 
that is probably good for all of us to get a fair and equitable 
help on this problem.
    I notice that Mr. Daniels, Mr. Overton, and Mr. Brennan in 
their testimony placed a great deal of emphasis on damages 
caused by perception as opposed to damages caused by actual 
damage, and I have heard many people also blame the media for 
assisting in this misperception of the American public. And I 
don't think any of us are surprised by that because the media 
is focused on being sensational and obtaining more viewers and 
more readers and frequently without any regard to the real 
impact it has on people.
    But my question to you would be since you are going to be 
up and running within a month hopefully, when you start 
processing claims from your perspective it won't make any 
difference if the damage is caused by perception or by actual 
damage. Is that correct?
    Mr. Feinberg. That is correct. Under the law of the Federal 
Pollution Control Act, which is a very important aspect of this 
whole process, actual physical damage to property is not 
required. So the issue for me--you are absolutely right on, 
Congressman. The issue for me is not whether perception that 
has an impact on tourism is compensable. The question really is 
going to be how far removed is a claim to be eligible. It is 
one thing if the perception harms a motel on the beach, even if 
there is no damage. It is another thing if the perception harms 
a motel 70 miles inland.
    Mr. Whitfield. Right.
    Mr. Feinberg. And I am going to decide, I take no advanced 
position on this, but that is where--I think that is what 
Congressman Stearns was getting at a little bit.
    Mr. Whitfield. Uh-huh.
    Mr. Feinberg. Where you draw that line on eligibility.
    Mr. Whitfield. And that is going to be one of the obviously 
key points that you are going to have to decide on. It kind of 
reminds you of the old Pause Graff case in law school.
    Mr. Feinberg. You remember. That is right.
    Mr. Whitfield. But on the--Mr. Dow, you talked about a $500 
million fund to assist. Now, would this money--is it your idea 
that this money for emergency marketing would also come from 
BP?
    Mr. Dow. Yes, I definitely believe it should come from BP, 
and the question whether it can come from this fund or 
additional amount but as I stated, my hope clearly is that this 
can mitigate the damages phenomenally to the tune of 7 to $8 
billion. Just as all the money was spent to cap that well, we 
ought to cap the damages now. No one would say let the oil run 
forever and let us just pay the people afterwards for their 
damages. They said, stop it, and we have to do the same thing.
    So I believe it should come from BP. Mr. Feinberg is--may 
be between a rock and a hard place, can that money come from 
the fund. I don't know.
    Mr. Whitfield. Do you have authority to pay out money for 
marketing?
    Mr. Feinberg. I don't think. Again, I am not privy to that 
negotiation involving the escrow account, but I don't think 
under the terms of that escrow account $500 million for 
marketing could come out of that $20 billion. Now, that doesn't 
mean there aren't other sources for it, but I don't think, I am 
not an expert on this, but I don't think it could come out of 
it.
    Mr. Whitfield. If I come in for emergency payment from you 
and you give me emergency funds, will I be required to sign a 
release for legal liability issues?
    Mr. Feinberg. No.
    Mr. Whitfield. Will I ever be required to sign a legal 
release?
    Mr. Feinberg. You will be required to sign a release down 
the road only if you come back to the Facility and seek a final 
payment for all of your then damage and projected future 
damage. Only then would you have to sign a release. Not as part 
of these emergency funds.
    Mr. Whitfield. Thank you.
    Mr. Rush. Ms. Castor is recognized.
    Ms. Castor. Thank you, Mr. Chairman.
    Mr. Dow, since the April BP blowout in the Gulf, have you 
seen these TV ads that BP has been running, polishing their 
corporate image?
    Mr. Dow. If you own a television set, you cannot not see 
them. I have seen them, and I have seen them, and it just 
points out to me the very clarity that BP truly understands 
that changing perception and getting the word out is critical. 
I think the same thing has to be done for the citizens, for the 
businesses of the Gulf Coast. It is critical, and it can stem 
the damages phenomenally.
    Ms. Castor. I think you said it well. If you own a TV, you 
have seen these incessant ads by BP. Oftentimes not very 
informative, just--they remind me of political campaign ads, 
frankly, and you can't pick up a newspaper.
    Mr. Malone, I am sure you seeing in Alabama what we see in 
Florida. Is there a day you pick up the newspaper you don't see 
these full-page ads?
    Mr. Malone. That is true, and I can tell you that we have 
met with some of the BP officials that you see in those ads, 
particularly the gentleman that represents he is in charge of 
claims for BP. We met as early as May the 11th in my office 
with our mayors and other leading people, some of our CPAs, in 
a proactive approach to try to establish an expedited claims 
process. Lots of promises were made that day on May the 11th, 
and I don't mean to be flippant, but in our community BP has 
come to stand for broken promise.
    Ms. Castor. Uh-huh.
    Mr. Malone. And that is what we have seen one after another 
after another. In fact, they issued a press release around the 
middle of June where they said they had adopted an expedited 
claims process for business claims. I read you the figures 
awhile ago. It has not come true.
    Now, Mr. Feinberg is right. The individual employee can 
walk in a claims office and walk out with a check for 2,500 or 
$5,000 if he has got his W-9s from last year or whatever--
minimum documentation. But when you ask a business to submit 
2,200 pages of documentation before your claim would even be 
considered, that is onerous. And that same business submitted 
their claim in May, mid-May, they have yet to receive less--
more than 10 percent----
    Ms. Castor. Uh-huh.
    Mr. Malone [continuing]. Of the claims they have presented 
since May to this date. These claims, they are referred to as 
large claims. They differ on whether that is over 20,000, over 
50,000, depending on who you talk to. They are sent to a 
forensic account for examination before they ever get in 
consideration. That takes weeks and weeks to do. And as I said 
in my recent comments, to me is the analogy of everyone 
submitting their income tax returns, and if you do a refund, 
you can't get your refund until a full audit is completed. They 
are doing a full audit before they are writing a single check 
to our businesses, and I am not always talking about the 
million dollars businesses. They guy who rents beach umbrellas 
on the beach.
    Ms. Castor. Uh-huh.
    Mr. Malone. Submits $60,000 claims. That is his whole year, 
that is----
    Ms. Castor. Don't you think it is making folks mad because 
they understand how much this media campaign is costing BP? I 
mean, do you see the same thing in Mississippi, Mr. Daniels? Do 
you see all these ads on the TVs and TV commercials?
    Mr. Daniels. Yes, without a doubt we do, and actually as a 
broadcaster we sell advertisement to BP. That is the paradox 
here.
    Ms. Castor. Uh-huh.
    Mr. Daniels. From a broadcasting standpoint it is not 
necessarily the ads. It is the reassurance.
    Ms. Castor. Uh-huh.
    Mr. Daniels. And if the Federal Government would do one 
thing that is reassure by way of Mr. Feinberg's claims but 
especially when it comes down to saying that the seafood is 
safe. What the rest of the world needs to hear and especially 
the Nation needs to hear is that it is oK to go in the water 
and that it is safe and that it is being monitored.
    Ms. Castor. Right.
    Mr. Daniels. I----
    Ms. Castor. The--we--I know someone had made an inquiry of 
BP about how much money they have spent on these ads, and they 
refused to provide that information, so, Mr. Chairman, I would 
like to ask unanimous consent that this committee seek from BP 
the amount of money that they have spent on their corporate 
image-polishing campaign since the BP blowout.
    Mr. Rush. The Chairman will consent to the gentlelady's 
request to direct staff to address a letter to BP specifically 
with that question in mind.
    Ms. Castor. Thank you, Mr. Chairman, very much, and quickly 
in my remaining time, Mr. Feinberg, this--we have got to be 
able to bring our local government and CVB industry state 
claims as part of your $20 billion escrow. How do we do this? 
Do we need to lobby the Administration and BP to have that 
included in this escrow agreement that is going to be coming 
out in the next week or two?
    Mr. Feinberg. First of all, the government claims are 
included in the $20 billion escrow. They are just not part of 
my watch.
    Ms. Castor. Uh-huh.
    Mr. Feinberg. Out of that 20 billion will come not only the 
claims that I pay but all government claims will come out of 
that $20 billion, but the way the understanding is reached 
between the Administration and BP government claims are the 
direct responsibility of BP, even though they are coming out of 
the $20 billion.
    Ms. Castor. So what is your opinion? Don't you agree that 
you and your experts will--are competent, in fact, expert 
enough to sort through those very difficult and detailed 
claims?
    Mr. Feinberg. If it is the will of the parties to the 
agreement, the Administration and BP, I am glad to take----
    Ms. Castor. So it is up to them?
    Mr. Feinberg [continuing]. On that--as if I don't have 
enough problems, but I would be glad to take on that 
assignment, but, again, not only watch at the current time. Nor 
the moratorium claims either.
    Ms. Castor. Thank you.
    Mr. Rush. The Chair recognizes Mr. Barton for 5 minutes.
    Mr. Barton. Thank you, Mr. Chairman. Most of my questions 
are going to be towards Mr. Feinberg simply because he has got 
a huge undertaking, and we don't get him before our committee 
too often, but I want to tell you other gentlemen, I listened 
to your testimony in my office. I clearly understand the issues 
that you are dealing with and clearly support that you should 
be compensated, and I am especially pleased to know that there 
is still a Brennan involved with Brennan's. That is comforting 
to know since I am a frequent visitor to your restaurants when 
I am in New Orleans.
    My first question to you, Mr. Feinberg, oh, and let me say, 
I do support that there be a compensation fund. I do support 
that BP pays most, if not all, of the money that goes into that 
fund, and I do support that it be, as I said, fairly, quickly, 
and transparently paid out to the people that have the claims.
    My first question to you, Mr. Feinberg, is who do you 
report to? Do you report to the President, do you report to the 
Secretary of the Treasury, the Chairman of the Federal Reserve? 
Who exactly is your boss?
    Mr. Feinberg. I don't have a boss on this assignment. I 
think the fair answer, Congressman, would be that I report to 
the people in the Gulf. Both the Administration and BP frankly 
don't want to get near me once this program is up and running, 
and they want to--they are going to reinforce--I am totally 
independent.
    Mr. Barton. You did an excellent job in the other fund that 
you administered, but that was different. That fund was 
approved by the Congress, there were clear reporting standards. 
This is in a unique fund.
    Mr. Feinberg. It really is.
    Mr. Barton. There apparently is no precedent for it. 
Doesn't mean, again, that we don't need it, but if my 
understanding is correct, now that you have been either asked 
to serve or appointed by the President, he does not have the 
power to remove you. Is that correct?
    Mr. Feinberg. I think that clearly is correct. Clearly he 
doesn't have the power.
    Mr. Barton. All right. Do you have to personally approve 
each claim to be paid?
    Mr. Feinberg. As a theoretical matter, the answer is yes. 
Now, of course, there is going to thousands of claims, and I am 
going to have a process in place, an infrastructure where 
problematic claims will come to me. Hopefully we will 
consistently apply the formulas and there won't be a necessity 
for me to look at each and every claim.
    Mr. Barton. When a claim is paid, will your signature be on 
the check?
    Mr. Feinberg. You know, I don't know the answer to that 
question.
    Mr. Barton. All right.
    Mr. Feinberg. That is a good question.
    Mr. Barton. Where will the funds be deposited that you 
allocate? Will they deposit in the U.S. Treasury in Washington, 
in a branch office of the Federal Reserve, in a private 
financial institution or institutions?
    Mr. Feinberg. One, I don't know the answer to that question 
because I am not privy to the escrow negotiations between the 
Administration and BP. Two, I have urged both of the escrow 
negotiators to deposit at least some of the money in local, 
regional institutions in the Gulf that have expressed a real 
desire to benefit financially from this.
    Mr. Barton. Who makes the decision where--what depository 
institution is to be used?
    Mr. Feinberg. Again, that would be between the 
Administration and the fellow--and the Administration that I 
have been consulting with is Tom Perrelli, the Associate 
Attorney General, and at BP----
    Mr. Barton. But you have no definitive role in making that 
decision?
    Mr. Feinberg. None.
    Mr. Barton. You are purely--make the decision what the 
protocol is for claims, the claims process, and the decision 
making protocol for making decisions on the claims and then 
being sure that there is adequate follow up and documentation. 
Is that a fair statement?
    Mr. Feinberg. That is correct, and I want to make sure the 
checks don't bounce, but that is absolutely accurate.
    Mr. Barton. OK. What reporting requirement, if any, does 
the fund that you are going to oversee have to report to the 
Congress on dispersion and operation of the fund?
    Mr. Feinberg. It will be expressed reporting requirements 
that all interested parties, starting with the Congress, will 
have information, whether it is monthly or biannually, frequent 
reporting as to how the claims are being processed, what the 
statistics show, our claim rate, et cetera.
    Mr. Barton. What transparency will there be for the public, 
i.e., will there be a public Web site that shows claims paid 
and who received the money and perhaps even pending claims and 
the decision process by which a decision is made on a claim?
    Mr. Feinberg. Yes. Now, we have got to be careful as we 
were with the 9/11 fund that we don't disclose under the 
umbrella of transparency individual names or private 
information, proprietary business information, but I am 
completely in agreement with you, Congressman, in your question 
that we have got to have a transparent database from which 
people can review how we are doing and what our strengths and 
weaknesses have been.
    Mr. Barton. I have one more, Chairman, one more question, 
Mr. Chairman. I know that my time has expired.
    You in answer to the gentlelady from Florida's question, 
you indicated that other decision makers will have decision 
making authority over this $20 billion fund and that your 
authority is going to be restricted to certain dispersements. 
Do you make decisions on compensation for oil and gas workers 
who have lost their jobs?
    Mr. Feinberg. Yes. Not the moratorium rig workers, though.
    Mr. Barton. I understand that. For fishermen----
    Mr. Feinberg. Yes.
    Mr. Barton [continuing]. And, you know, seafood----
    Mr. Feinberg. All individuals, all private businesses, no 
government claims.
    Mr. Barton. OK. So you are--the government claims the 
decision maker is----
    Mr. Feinberg. BP.
    Mr. Barton. Well, they would--I wouldn't think we would 
allocate to them--what government official would oversee their 
decision?
    Mr. Feinberg. No. I mean I think the government official 
will send a claim for reimbursement, for cleanup, or for lost 
tax revenue or whatever to BP for processing. That is currently 
the plan.
    Mr. Barton. Mr. Chairman, do we--will we have the ability 
to ask written questions for responses from the panel?
    Mr. Rush. The Chair will address that issue once----
    Mr. Barton. I know my time is expired, and I appreciate the 
Chair, and I thank you for your answers, Mr. Feinberg.
    Mr. Rush. The Chair now recognizes Ms. Schakowsky for 5 
minutes.
    Ms. Schakowsky. Thank you, Mr. Chairman, and I want to 
thank all the witnesses.
    You know, I was listening to and looking through all the 
testimony here, and I think that it would be good, for example, 
for Mr. Daniels' questions, he asked a number of questions, to 
be included among those that we present as our own questions. I 
think they are very important and that he deserves those 
answers, and so that we should include that in the questions.
    Mr. Rush. They will be included in the written questions 
that we would submit to the witnesses.
    Ms. Schakowsky. Thank you. I also wanted to ask about the 
suggestion, I think it was Mr. Dow's suggestion, that the 
government incentize a--do an incentive for people to do 
tourism in the region. Was that you or Mr. Malone?
    Mr. Dow. It was me.
    Ms. Schakowsky. OK.
    Mr. Dow. It was part of three points of $500 million to get 
the perception, get the right information out, and incentize 
travel.
    Ms. Schakowsky. What--exactly what does that mean? What is 
incentize?
    Mr. Dow. There are several things that could be done. They 
have been done in the past. Commerce Department runs trade 
missions. There could be incentives where they don't charge for 
those missions to get more people here. There is opportunities 
to give meal tax deductions or some tax--things done. There are 
many things that have been done in the past throughout areas 
that will give people an advantage by going to an area and an 
incentive to do so, and we have got a list of them in that 
roadmap for recovery, ma'am.
    Ms. Schakowsky. Thank you. I think, Mr. Feinberg, you may 
have answered this, but Mr. Malone said that he has personally 
spoken with a large number of business owners who have yet to 
see a single payment, particularly the larger ones. Are you 
suggesting that they re-file when you are up and running or no?
    Mr. Feinberg. They won't have to re-file at all. We will 
assume responsibility for those claims and accelerate them as 
quickly as possible. As Mr. Malone has pointed out to me and 
Governor Riley in Alabama has pointed out, we don't want to 
reinvent the wheel by requiring people to re-file.
    Ms. Schakowsky. OK, and Mr. Feinberg, Mr. Overton was 
talking about the damage that has been done even though there 
is no oil at all. Is that still true? At his resort. This is 
clearly on the water, and so is his business eligible then for 
compensation from the fund?
    Mr. Feinberg. His business is eligible insofar as he has a 
claim where there has been no visible damage to the beach. He 
would have--that is not the issue in that case. What I don't 
know from that statement is how close is his business to the 
beach, how dependent is it on the beach or fishing or 
sightseeing or charter boats or what have you. So it is the 
facts surrounding the overall claim that are going to be 
critical in deciding eligibility in something like that.
    Ms. Schakowsky. Yes. This perception question is really 
hard to get your arms around, but maybe the biggest source of 
damage long term, am I right, Mr. Brennan? Did you want to 
comment on that?
    Mr. Brennan. Well, no. I think the best example is to look 
at Hurricane Katrina and the impact on New Orleans, the 
perception of the city as a damaged brand, and I think you as a 
member of Congress understand perception. We have to overcome 
that. It is just like BP is running these ads trying to change 
the perception of their company. We need to do a similar thing 
to change the perception of the hospitality and tourism 
industries along the Gulf Coast.
    Ms. Schakowsky. Whose responsibility do you think, Mr. 
Feinberg, or is it everybody's to proactively address this 
issue?
    Mr. Feinberg. Well, I think it is BP's responsibility. I 
think BP has done some things, nothing to do with me. They 
clearly haven't done enough. They have spent some money, I 
believe. From what I have read in the newspapers they have 
spent some money promoting tourism in the Gulf but others know 
better than I about that.
    Mr. Dow. I will address that. BP initially spent $70 
million, $25 million for the State of Florida, $15 million for 
the three other States. Requests have been denied by the 
Governor of Florida and by about ten Gulf Coast communities--
not denied. They have not received any other information. The 
Governor of Florida was denied, the other communities have not 
heard anything back, and the challenge is it is $70 million, 
and as I stated earlier, very little of that has actually got 
to marketing. I think one of the most important things this 
committee--that BP could do is isolate the funds and say, let 
us get experts working on this, and let us be sure they do that 
job, and I believe the gentleman to my right could do a 
terrific job overseeing that because he has proven himself. 
Thank you.
    Ms. Schakowsky. Yes. I thank all of you for your efforts. 
Mr. Feinberg, you--and good luck on all your work.
    If I could, Mr. Chairman, just a point of personal 
privilege, I have spent vacations many summers on the Pan 
Handle of Florida, and these sugar white sand beaches were 
just, of course, the lure. And the notion that the beaches 
would be spoiled but also that the reputation of this area 
would be hurt is just so painful. I can only imagine how it is 
to all of you.
    So I thank you for being here.
    Mr. Rush. Mr. Stearns is recognized for 5 minutes.
    Mr. Stearns. Thank you, Mr. Chairman. Mr. Feinberg, the 
question would be who is going to pay the salaries of the 
employees that you hire to implement this program and 
disbursement the of $20 billion?
    Mr. Feinberg. BP.
    Mr. Stearns. BP. And how many employees do you think that 
you will expect? Can you extrapolate from your 9/11 experience?
    Mr. Feinberg. Well, with 9/11, which was a relatively, 
thank goodness, a relatively modest, clean cohort----
    Mr. Stearns. Right.
    Mr. Feinberg [continuing]. We had 475 employees. BP in 
paying out $230 million so far has hired about 1,500 at 35 
claims offices throughout the Gulf Region, and I think seven in 
Florida. I am now putting together a budget for the Gulf Coast 
Claims Facility. I think we probably wouldn't need that many 
people, but I will know more about that in the next week or 
two.
    Mr. Stearns. I understand. So it is roughly going to be 
1,500 or less, and----
    Mr. Feinberg. Correct.
    Mr. Stearns [continuing]. These employees will be paid by 
BP.
    Mr. Feinberg. Right.
    Mr. Stearns. I mean, by the BP funds.
    Mr. Feinberg. That is correct.
    Mr. Stearns. And the salary structure, is this going to be 
something like the private sector or the government--the 
private sector or the government sector?
    Mr. Feinberg. Again, the Deputy Administrator of the fund, 
Camille Biros, who is putting--setting up the budget, she would 
have a better handle on that, but I can certainly get you that 
information.
    Mr. Stearns. In 9/11 did you use--what standard did you use 
for salaries?
    Mr. Feinberg. In salaries we used--Price Waterhouse had a 
contract with the Department of Justice----
    Mr. Stearns. OK.
    Mr. Feinberg [continuing]. That used largely private 
salaries.
    Mr. Stearns. OK. I have here I think it is a four-page 
claim form that BP used for commercial fishermen. I notice on 
their form it does not have a notary public on it, and it 
just--the people can fill it out. Do you intend to use the same 
form, or are you going to come up with your new form?
    Mr. Feinberg. New form.
    Mr. Stearns. New form. OK, and I notice that with BP that 
43 percent of the claims are still waiting payment. So that 
means are you going to take over and inherit all those 43 
percent, and does that mean that these people who supposedly 
haven't got claims, lack of information, are you going to 
follow up on that?
    Mr. Feinberg. Yes. We will not require people to re-file. 
Now, that 43 percent figure, I am not sure that figure is 
accurate.
    Mr. Stearns. OK.
    Mr. Feinberg. Because BP apparently has counted as a claim 
somebody who makes an inquiry and gets a claim number and never 
fills out the form. So I am not sure. I got to get my hand on--
I got to get a handle on that data.
    Mr. Stearns. OK. Let me just give you a statement and ask 
if you agree with this. Do you think everybody should get 
reimbursed no matter where they are located if they can prove 
loss of income because of this spill?
    Mr. Feinberg. No. No.
    Mr. Stearns. Because, you know, a family could say I am in 
Tennessee, they are going to go to Pensacola, they say, we are 
not going to go to Pensacola, we are going to go to Tampa, and 
then the gas station on the interstate could say, well, golly, 
I just didn't get that family to Tennessee and make that claim. 
So, I mean, how are you going to work this so that it is a fair 
thing?
    Mr. Feinberg. I have to listen to these experts that are at 
this table like Mr. Malone, and Mr. Malone in a very careful 
presentation laid out for me sort of the proximity, the zone 
where there is the greatest direct impact and said, Mr. 
Feinberg, in that zone in Alabama that is the zone that is the 
most directly impacted. Tourism. These are the restaurants, the 
motels, the other sites, and with input from experts I will try 
and answer that very question as to what is the proximity where 
it is most likely that a claim should be deemed eligible.
    Mr. Stearns. Mr. Feinberg, under 9/11 did you have anybody, 
accounting firm come in and look at what you did? Was there 
anybody not necessarily that you reported to but somebody sort 
of like we have here, Inspector General, GAO, can go into a 
government agency and sort of tell members of Congress what is 
happening. Did you have that on the 9/11 commission?
    Mr. Feinberg. Constantly. The Office of Management and 
Budget.
    Mr. Stearns. OK. Now, you are not going to have that here. 
Don't you think you should--you would even want to have an 
Inspector General or a claims--or somebody that could oversee 
this and report back to Congress on what you are doing instead 
of you reporting back on what you are doing yourself? Don't you 
think, I mean, I would think I would like to have somebody 
checking up on me just to make sure that I get the cross the 
dots----
    Mr. Feinberg. I love that idea. I think we are going to do 
that. Now, we will have a separate question related. What 
about--I have heard this from various Congressional committees. 
What about fraud? Right. What about the problem of fraud? Not 
so much auditing. It is just fraudulent claims.
    Mr. Stearns. Right.
    Mr. Feinberg. The Department of Justice, Criminal Fraud 
Division, is working with us directly.
    Mr. Stearns. You will refer them to the Department----
    Mr. Feinberg. Absolutely will have an internal retained 
anti-fraud expert working within the facility to audit and 
check for fraud, but I absolutely have no problem with 
transparency in the form of Congressional oversight or some 
sort of regular reporting by an independent person checking on 
what we are doing.
    Mr. Stearns. Mr. Chairman, I think what Mr. Feinberg is 
mentioning is something that this committee or some committee 
in Congress should help him with this legislation that allows 
him to report to or they provide sort of an Inspector General 
type of accounting here. This is a huge amount of money, $20 
billion, and I think the American taxpayers obviously would 
like some kind of report, and obviously we have great 
confidence in Mr. Feinberg, but I think at the same time he 
wouldn't mind having somebody to counterbalance and show that 
everything is going--because this is going to be 1,500 
employees that are working in a way that is--he can't control 
completely. So it is just a thought.
    Thank you, Mr. Feinberg.
    Mr. Rush. Mr. Stearns, your point is well taken, and it 
will be taken under consideration by this committee.
    Now, we recognize Mr. Green of Texas, recognized for 5 
minutes.
    Mr. Green. Thank you, Mr. Chairman. I know you read a 
statement earlier, and I would like to ask this question of Mr. 
Feinberg. We know BP has paid about over $200 million in 
emergency payments, and the committee has heard complaints 
about BP's claims process, and Mr. Malone describes the process 
as erratic, somewhat convoluted, and at times dysfunctional. I 
think that could probably apply to Congress in some cases.
    But, Mr. Feinberg, I was hoping if you could comment on how 
BP's processed these claims so far, specifically what problems 
have you identified.
    Mr. Feinberg. I think BP deserves some credit here. Most of 
these mass disasters that I have been involved in over the 
years, when I get involved, I start sort of from scratch. There 
is nothing in place, and we have to build from the beginning. 
While I am rushing to set up this facility in just a few weeks, 
in August, BP continues to pay claims.
    Now, the problem is that as my fellow witnesses have 
pointed out accurately, BP is quick to pay the individual wage 
loss claims. They are quick to pay claims where there is 
physical destruction; oil on the beach or flowing somewhere 
injuring property, destroying property. Where they are 
reluctant or where they have less assuredness is business 
interruption claims, lost profits, lost business, calculating 
lost business, corroborating lost business, and that is why I 
think the gentlemen that are here today testifying are 
frustrated by BP, yes, they paid $230 million, but shouldn't 
they be doing more on the business side?
    And I appreciate that, and when I set up this facility ASAP 
we will focus on those business claims.
    Mr. Green. OK, and so your testimony earlier that the 
claims will be actually--what BP is doing--you are monitoring 
those, and they are coming to you now instead of BP directly.
    Mr. Feinberg. They will be in a matter of weeks, and I will 
accelerate the payment of those claims.
    Mr. Green. OK, and how do you plan to staff a Gulf Coast 
Claims Facility?
    Mr. Feinberg. We will keep the people that are there now. 
We will train them in the new facility. We will keep those that 
we like. We will hire additional local, local vendors and local 
people in the four-state, five-state area, as needed, and we 
will set up this new infrastructure in a matter of weeks.
    We are doing it now actually.
    Mr. Green. Mr. Malone, do you have any response to that? I 
know compared to Louisiana and Mississippi and Alabama and 
obviously the upper, the Gulf Coast of Florida, upper coast, 
have you seen the payments getting better and more response?
    Mr. Malone. As Mr. Feinberg said, the small payments to the 
individuals have been fairly routine matters. The payments to 
businesses that are in excess of $50,000, $100,000, and up, 
excess of $1 million have been extremely difficult to obtain.
    Mr. Green. Has it been because of documentation?
    Mr. Malone. It is very sporadic. There have been some 
spells where they have written some companies some large checks 
rather quickly. Other companies have been waiting nearly 3 
months for their first check.
    Mr. Green. OK. Well, coming from where I am and obviously 
we were concerned about Galveston a couple of weeks ago, but 
not that we don't have tar balls on a regular basis but that 
wasn't the issue and I know in southeast Texas but my concern, 
too, is if each of you could comment not only on the BP's 
response but also the impact of the moratorium, the hard 6-
month moratorium we are seeing on whether it be Alabama, 
Mississippi, or Louisiana.
    And what are you seeing on that, and those folks except for 
the workers, they probably are allowed compensation. If you are 
laid off of a rig, could you comment on that?
    Mr. Malone. Are you talking to me or Mr. Feinberg?
    Mr. Green. Yes.
    Mr. Malone. I am in tourism, sir. I am not familiar with 
what is going on in the oil and gas industry. I know that our 
workers who are laid off get compensated. They go to the State 
Unemployment Office, and what that doesn't pay, then they get 
money from BP. I am just not familiar with the oil and gas 
industry and what is going on with their workers.
    Mr. Feinberg. If a rig worker was laid off as a direct 
result of the moratorium, BP agreed to set aside $100 million, 
not part of the $20 billion, a separate fund of $100 million 
just for moratorium rig worker claims.
    Mr. Green. Has that been pretty widely advertised, 
particularly in Louisiana? My colleague, Mr. Melancon, you 
know, that we are doing it, because I have folks in my own 
district who work offshore. I have not heard, but the fear is 
that they are not going to be able to continue to work.
    Mr. Feinberg. I think it has been fairly well publicized, 
and BP is now deciding where to deposit that $100 million, 
which will be earmarked only for unemployed moratorium rig 
workers.
    Mr. Green. I know I am out of time. Do you know how much of 
that $100 million has been expended?
    Mr. Feinberg. I don't think any of it yet. I don't think it 
has been deposited yet to pay out those claims.
    Mr. Green. OK. Thank you, Mr. Chairman, for your patience.
    Mr. Rush. Dr. Gingrey is recognized for 5 minutes.
    Mr. Gingrey. Mr. Chairman, thank you very much. We have 
spent most of the morning listening to our witnesses and asking 
questions and of course, most of the questions and the 
testimony is around the issue of how we are going to get paid. 
And, of course, everybody looks at Mr. Feinberg, of course. He 
has got a tremendous job and responsibility in seeing that that 
is done in a fair and equitable way. And it is important, and 
you brought out the fact that time is of the essence. I think 
Mr. Feinberg may have said that.
    The others of you have said, well, gosh, you know, I think 
Mr. Overton talked about Florida and even though there are no 
tar balls washing up on the beaches, the effect on the economy 
because of perception. And we talk about individuals, rig 
workers, and fishermen, and people that, you know, have these 
direct claims that are going to get processed real quickly, but 
the small business men and women across the country, the 
husband and wife that own the Motel 6, you know, maybe 100 
miles, 70 miles I think was mentioned, from the coast that are 
suffering because they depend on when all those motels along 
the coast are full in peak seasons, thank goodness they call up 
their friends 70 miles away and say, hey, have you got a 
vacancy.
    I mean, how many of us know when we traveled to Florida 
years ago with our parents that you would just drive miles and 
miles and miles trying to find--or you saw these blinking neon 
signs that said, ``no vacancy,'' and you would have to go 70 
miles inland.
    So, you know, there is a huge problem, and Mr. Feinberg, it 
probably extends a lot further than we realize today as far as 
economic losses. I want to real quickly, you know, Rahm 
Emanuel, the Chief of Staff of the President, was credited with 
making a statement, ``Well, let no crisis go to waste.''
    Now, from the political perspective on our side of the 
aisle we would say that was--that is deplorable, but from a 
policy statement, if that is what he was talking about, then, 
in fact, I would agree that we should not let a crisis go to 
waste, and we should make an attempt to make lemonade out of 
these lemons, this huge lemon of the oil spill in the Gulf of 
Mexico.
    And, you know what I think should be done, and I would love 
your opinion on it, the President's state of the union address 
said, you know, we are going to take $30 billion of the TARP 
money, the unspent TARP money. We gave--forced, in fact, the 
nine or ten largest financial institutions in the country to 
take that money even against their will, but it has been paid 
back, not completely, but to a large extent, and the President 
said, let us take $30 billion of that money and let us give it 
to--let us recapitalize the small banks and help them make 
loans because small businessmen and women can't borrow the 
money that they need to stay afloat.
    Wouldn't this be a great opportunity for the Federal 
Government to listen to the President and to actually follow 
through on this and get money available to small community 
banks, not just in Florida, all along the Gulf Coast, indeed, 
Georgia has 120 miles of coastline, and Florida and Georgia are 
two of the States that are seeing banks close every week on 
Friday, you know, or Saturday morning. You look to see, you 
know, which community bank is going under, and all these jobs 
are lost as a result of it. All these small Mom and Pops that 
invested 5, 10, 15, $25,000 to start that bank would be part of 
the start up, raise $15 million or whatever.
    That money is totally wiped out. This would be a great 
opportunity to turn lemons into lemonade and to get that money 
in the hands of these small banks so that these businesses that 
are waiting on Mr. Feinberg to adjudicate their claims would 
have money to stay in business.
    I would like--Mr. Feinberg, we will start with you, but I 
know this is not you all's area of expertise, but you all are 
bright men, and you know what I am talking about, and we need 
to get this conversation going.
    Mr. Feinberg. Am I safe if I say worthy of consideration?
    Mr. Gingrey. How about damn worthy of consideration?
    Mr. Dow.
    Mr. Dow. Yes. Mr. Gingrey, I think it is an admirable 
thought. When you talk about small businesses, you look at the 
Gulf Coast, it is probably almost all small businesses. New 
Orleans has big hotels and big--but if you look at this Gulf 
Coast, this is made up of people who have relationships with 
these small banks. People know they have got their records and 
all that versus the larger banks, and I think it is all small 
business.
    And the other thing, I also think this is a phenomenal 
opportunity. There will be another hurricane, there will be 
another tsunami, there will be another earthquake, and this is 
an opportunity for us to set in place how we deal with these 
disasters so we don't have to reinvent the wheel, and that is 
why I think this marketing fund we talked about is so critical 
and that we can use this over and over again.
    But this is a great opportunity for the government to learn 
and to really set a process for the future.
    Mr. Gingrey. Well, and I see my time is running out, Mr. 
Chairman. I don't want to extend too long here, but clearly, 
the President called for this to be done, it hasn't been done. 
This Financial Regulatory Reform Bill, the reason so many of us 
were opposed to it, it did nothing for Fannie and Freddie, but 
as far as this provision for some of that TARP money to the 
smaller community banks, it never happened.
    But it is not too late, and we need to really look into 
this closer, Mr. Chairman. I hope we have an opportunity to 
discuss it further.
    Mr. Chairman, I know some of the witnesses want to respond 
to this. It is up to you whether or not--I will shut up, and 
you can let them talk if they--you give them time.
    Mr. Rush. Witnesses have a response? Yes.
    Mr. Daniels. I must say I think it is a great idea, but I 
would be remiss if I did not impress upon you that this is 
still a liquid situation. Every day there are those of us on 
the Mississippi Gulf Coast who are praying that the cap stays. 
There is still oil in the water, and granted, the discussion of 
payment is excellent. Your idea is excellent, but BP doesn't 
have enough money when we talk about perception over the years 
if the oil continues to come.
    So I think the idea of utilizing the community banks is 
great, but what the people on the Gulf Coast needs is 
reassurance. What they need, and only the Federal Government 
can give this, by the way, is the reassurance that it is safe. 
The reason--no matter how much advertisement BP does or we do 
in the tourism industry, if you don't think it is safe to go to 
the beach, then you are not going to take your kids.
    So you esteemed gentlemen are the ones who are in charge of 
the DMR, OSHA, the DEQ. You guys need to have at BP's expense 
an army of scientists, biologists, and marine biologists there 
assuring the rest of the world that it is oK, and first, assure 
them that there is no more oil in the water.
    So I think you have two components. I think Mr. Feinberg 
and BP with $20 billion will not be enough if we are still 
discussing this very fluid situation next year.
    Mr. Rush. Mr. Daniels, we are going to move on because we 
have other members who want to question the witnesses.
    Mr. Gonzalez is recognized for 5 minutes.
    Mr. Gonzalez. Thank you very much, Mr. Chairman. My 
question will go to Mr. Feinberg, and I have had the benefit of 
hearing your testimony in the Judiciary Committee, but I wasn't 
able to ask a question. I want to ask it at this time.
    At the time of your testimony last week before Judiciary, 
that same morning Joe Scarborough, who is from Pensacola, was 
broadcasting his show from Pensacola and the beach, and he had 
a State Senator, and the State Senator made a couple of 
comments, and so I will build my questions on the comments.
    The first one was, look at our beaches. They are beautiful, 
pristine, everything is fine. We are not getting people here. 
So it is the perception, and you have referred to this in the 
past, and I apologize. I wasn't here for all the testimony, and 
that is Charlie Gonzalez is thinking of going to Pensacola, but 
I am afraid there is oil, so I don't go, no one is at the 
hotel, the motels. That hotel, motel owner is a victim of some 
perception. It may be false. How are you going to handle that 
claim?
    What was disturbing to me was that the State Senator's 
comment was, right now we have been dealing with BP on claims. 
Can you imagine now we are going to have to deal with the 
Federal Government? And you have already made it very clear 
that you don't--that is not your boss, neither is BP.
    But would you say to that State Senator? Why is it that 
this Gulf Coast Claims Facility is superior to what was in 
place prior to the agreement?
    And the second question is the one that I would like for 
you to answer if you don't mind and then go to the perception 
of the beaches being spoiled and such.
    Mr. Feinberg. I would like to think that with the 
experience that I would bring and the confidence that the 
President and BP had in selecting me to do this based on my 
prior work in processing mass disaster claims, BP is an oil 
company, not a claims facility, I would like to think that we 
will be able much more efficiently, much more effectively to 
process claims in a way that will engender the support of the 
people that I am trying to help.
    All the talk in the world won't replace payments, and a 
sense that people have and businesses have that there are 
actually checks being paid to eligible Claimants. So the proof 
will be in the result in the next month, and I am hoping with 
my fingers crossed that the President's confidence in me and 
the Administration's confidence in me and BP's confidence in me 
will result in the people in the Gulf having confidence in me 
so that the program is working and that it is credible.
    Mr. Gonzalez. And to the second question, and I don't 
know--not to pre-judge any claims, but what do you do if the 
perception was that there was oil on the beach when there 
wasn't, but the business has suffered?
    Mr. Feinberg. You cannot need oil on the beach to have a 
compensable claim. I want to emphasize this. Florida law may 
require, I don't know. Attorney General McCollum has a 
different view and probably the correct view, but you don't 
need oil on the beach, you don't have to be unable to fish. 
Perception is compensable.
    Now, the problem that Congressman Stearns and others pose, 
well, what is the proximity requirement? What is the dependence 
on that beach or on fishing or on shodder boats or sightseeing? 
I will have to draw some lines on eligibility. The lines will 
be based on proximity to the beach or to that natural 
resources, fishing or what have you, the industry, fishing, 
crabbing, oyster harvesting is easy. Motels, restaurants 
depending on the motel and type of restaurant, legitimate, 
eligible, and how dependent is that claimant on natural 
resources. And I will have to in the next, actually in the next 
few weeks I am going to have to develop eligibility criteria 
that will answer that question.
    Now, the Claimant still has to prove the claim. Eligibility 
is one issue. Corroborating the claim by showing that the spill 
caused my loss, that is another issue, but that is what I will 
have to deal with.
    Mr. Gonzalez. Thank you very much, and I want to thank the 
other witnesses, though I may not have a particular question. 
Thank you for your testimony, and I yield back, Mr. Chairman.
    Mr. Rush. The Chair recognizes Mr. Scalise of Louisiana.
    Mr. Scalise. Thank you, Mr. Chairman.
    It has been talked about by a number of you about the 
problems of perception, both with tourism, with food, the fact 
that even where some areas have absolutely no oil, you still 
got a double digit, if not over 50 percent drops in people that 
are coming, and I want to start with you, Mr. Brennan.
    When we talk about how to combat that, especially once the 
oil, you know, and we are all praying that this well is capped 
real soon, but there is still going to be oil that has got to 
be cleaned up, and there is still going to be perception 
problems. I know our State has worked on some different types 
of certification proposals to encourage FDA to set up a formal 
process so that people can go out there and actually have, all 
across the country have a clear confidence level that if they 
are buying seafood, we know if you can buy it, it is safe 
because our vendors aren't selling seafood that is unsafe, but 
there is a perception and a concern out there, and so a 
certification process would give a higher level of confidence.
    First, can you talk about both that combined with 
marketing? What is it going to take in your opinion to get 
people to feel comfortable walking into a seafood restaurant, 
not just in New Orleans but anywhere in the country, to know if 
it is from the Gulf that it is safe?
    Mr. Brennan. Congressman, clearly there are two issues 
here. You know, one is the damaged brand of the entire Gulf 
Coast as a tourist destination, and the other which you just 
mentioned is the food safety concern, and there are a number of 
regulatory agencies at the state and federal level that are now 
evaluating the safety of the seafood on a daily basis.
    And we need one consistent program that can become sort of 
the goal standard that--so that people will feel comfortable. I 
had an opportunity to have dinner with a lady the other night 
from Santa Monica, California. She said she would never eat 
Gulf seafood because despite what they are saying about it, she 
still believes that it is tainted in some way. And there are 
probably many people around the country that feel that way, and 
there are restaurants around the country that are posting signs 
saying, we don't serve Gulf seafood.
    So we have a serious issue here, and we need one standard 
so that the country will feel confident that the seafood that 
comes out of the Gulf is of----
    Mr. Scalise. Mr. Overton, we will just go down the line.
    Mr. Overton. The seafood industry in general, particularly 
when you talk about the fisheries of the Gulf of Mexico, have 
been under-funded for a long time, the research associated with 
it, and so, you know, back to the earlier comments of how do we 
bring something good out of this crisis, I think it is an 
opportunity for us to take some funds and do some measurable 
data on the water columns, the baselines, and know how many 
fish we have, how many have been--what, you know, this class of 
fish, is it totally destroyed, or is it partially destroyed? It 
will give us an opportunity to really look at what our data 
should tell us today.
    We don't have the funding currently to do that, and if I 
may, just one other point. When it comes to the perceptions, 
and Mr. Feinberg may have a comment on this, the complexity 
that we are faced with now is that we actually lose money in 
September and in August. We don't make a profit. We make our 
money in the other parts of the year, so what are we going to 
do if we don't have a claim paid by then, and by the way, for 
the record, I am not aware of any business owner in Florida 
that has been paid a large claim as of yet.
    So what are we going to do? Are we going to become servants 
to the bank and our debt service covenant ratios, which are 
very important. Those covenants just can't be broken, or do we 
go lay employees off because we need to make that number? And 
that is what we are faced with.
    Mr. Scalise. Thank you, and I apologize, I have only got a 
minute and a half left, and I have got a number of other 
questions.
    Mr. Malone, if you can get me a copy of the presentation 
that you made to Mr. Feinberg, it sounds like you all really 
put some things together that made an impression on him. If you 
would be willing to share that----
    Mr. Malone. Yes, sir.
    Mr. Scalise [continuing]. With us as well, I would love to 
see that, too.
    Mr. Malone. Be happy to. Can I speak briefly to another 
question about perception?
    Mr. Scalise. Real quick.
    Mr. Malone. Real quick.
    Mr. Scalise. I have got some questions for Mr. Feinberg, 
and I have only got a minute now.
    Mr. Malone. OK. The science community is doing our region a 
terrible injustice. We tend to believe the EPA, the regulatory 
bodies, but every week somebody, some scientist from some 
university, it varies, is continually questioning the quality 
of the water, quality of the air. As long as those questions 
are out there, these misperceptions are going to be----
    Mr. Scalise. All right, and I have got to get to my 
questions for Mr. Feinberg. As you have heard some of these 
comments from the panelists today, other conversations you had, 
can you help give them some confidence that when we talk about 
some geographical limitations, if you got a restaurant in New 
Orleans, and it is 60 miles away from the point of impact, how 
are you going to factor that in?
    Mr. Feinberg. I am going to factor that in. Proximity makes 
it sort of a per se case. If you are right on the beach or you 
are right by the Gulf, by the waters, it sort of--that is what 
I mean when I say proximity. It is sort of easy.
    That doesn't mean if somebody has another facility farther 
away they are automatically ineligible. We will take a look at 
the facts.
    Mr. Scalise. OK. Real quick, too. On the escrow 
negotiations, are you kind of held back on what you can do to 
start setting up your operation and cutting checks for that to 
be completed, or can you start before they complete these 
escrow negotiations?
    Mr. Feinberg. No. I am not held up. We are on parallel 
tracks. The sooner the escrow is set up the better, but 
meanwhile I am going forward setting up the infrastructure.
    Mr. Scalise. Can you cut any checks before the escrow 
negotiations occur?
    Mr. Feinberg. No, but I am confident that by the second 
week of August, which is, you know, already too late, I am 
hoping that the escrow should be up and running so that there 
will be no inability to cut checks.
    Mr. Scalise. OK, and then you said with the $100 million, 
that is the only place to go for people who work on rigs. There 
is really no place to go that I have heard of for people that 
service rigs. Can they go to your fund? Would you pay them out 
of your fund? And if not, is just unemployment their only 
option at this point?
    Mr. Feinberg. I don't know about unemployment. I can tell 
you that unemployed rig workers who are unemployed because of 
the government's moratorium don't have a claim against the----
    Mr. Scalise. Once that--that $100 million is going to run 
out within 2 months if they start paying on it by any estimate 
that we have been given, and so once that is extinguished, do 
they have any recourse other than just going on unemployment? 
They are still unemployed, and there is still a moratorium 
after 2 months.
    Mr. Feinberg. I am just suggesting I doubt very much that 
they would have a claim within this fund.
    Mr. Scalise. OK, and then if you could give me offline here 
the protocols for review board. As you are setting up the 
process if somebody----
    Mr. Rush. Mr. Scalise.
    Mr. Scalise [continuing]. Disagrees with your ruling and 
they want to go to some kind of additional process----
    Mr. Rush. Mr. Scalise, this is your last question.
    Mr. Scalise. Thanks, and I yield back. Thank you, Mr. 
Chairman.
    Mr. Rush. All right. The Chair now recognizes Mr. Sarbanes 
of Maryland.
    Mr. Sarbanes. Thank you, Mr. Chairman. Thanks to the panel.
    Mr. Feinberg, I was going to ask you some questions. You 
say that you are not privy to the negotiations that are going 
on with respect to the escrow fund. Are you OK with that? Does 
that--do you think that is better from your standpoint? Worse? 
Or what is your perspective?
    Mr. Feinberg. I am neutral. As long as the money is 
available when the Gulf Coast Claims Facility starts processing 
claims and cutting checks, that is fine with me.
    Mr. Sarbanes. Do your decisions, are they immune from 
challenge under whatever understandings have been----
    Mr. Feinberg. No.
    Mr. Sarbanes. No.
    Mr. Feinberg. No.
    Mr. Sarbanes. So if you and Mr. Malone are talking about 
the appropriate zone, and the government things you have drawn 
the zone too small, and BP thinks you have drawn the zone too 
big, or someone who is on the outside of the zone doesn't agree 
with your judgment call, are you anticipating that there is 
going to be some challenge presented to that? Or are you--or 
under the structure of this arrangement is that not 
challengeable?
    Mr. Feinberg. Neither the government nor BP can challenge 
my independence, but if an individual claimant, business or an 
individual, doesn't like my eligibility determination or 
doesn't like the amount of money that I have awarded, that 
individual has two choices. The individual can either, not 
either, both. First, the individual can seek an appeal to three 
ex-Judges or an Appellant body that will review my decision, 
and only then can the Claimant, who if he or she is still 
dissatisfied, Congressman, can opt out of this system 
altogether and go file a lawsuit.
    Mr. Sarbanes. Got you. Was it a condition of your accepting 
this assignment that BP and the government agree that your 
judgment calls would not be challenged by them?
    Mr. Feinberg. Yes.
    Mr. Sarbanes. OK. Mr. Malone talked about how there are 
people who--let us assume there is a good claim coming down the 
pipeline, and when it eventually gets to you, you are going to 
do the right thing, but it is not there yet, and the business 
that is seeking those--that compensation is in a position as 
Mr. Malone described where they may not be able to hang on as 
against the obligations they face from others, from third 
parties.
    Is there anything that can be done in your mind? Is there--
could you even though you are not set up and ready to go, is 
there some kind of comfort letter or something that you can 
provide to that business that says, you know, by all 
indications you will be in a position to submit your claim to 
us once we are up and running, and you can use this letter and 
present it to third parties who may be liening on you so they 
understand that, you know, there is some recourse available to 
them? Is that something that is possible?
    Mr. Feinberg. Yes. First, I am going to be up and running 
in a matter of weeks. Now, that is too many weeks, but I 
understand that. That is small solace to somebody who is on--
about to close their business. I will be up in a matter of 
weeks.
    Secondly, if I know of that claim, I mean, BP is paying 
claims. If there is a claim like that that I can't wait 2 weeks 
or 3 weeks, be it a letter or your promise or your willingness 
to deal with me, if I know that claim, I will go to BP for that 
claimant. I have done this already----
    Mr. Sarbanes. OK.
    Mr. Feinberg [continuing]. To try and ease that transition.
    Mr. Sarbanes. So there is some recourse. I mean, if 
businesses can be identified that are kind of caught in the 
switches here, there is a way you can get that in front of BP--
--
    Mr. Feinberg. Yes.
    Mr. Sarbanes [continuing]. And say before it is too late, 
do something here while we are in this transition period.
    OK. All right. Thank you. I yield back my time.
    Mr. Rush. The Chair recognizes Dr. Burgess for 5 minutes.
    Dr. Burgess. I thank the Chairman for the consideration. I 
am not part of this subcommittee, but I am part of the full 
committee.
    Mr. Feinberg, if I understood correctly in your answer to a 
question Mr. Barton asked that the framework that is being set 
up surrounding your administering this fund is actually being 
done in the White House by an Assistant Attorney General, is 
that correct?
    Mr. Feinberg. The framework setting up my Claims Facility 
is being done by me. The framework for setting up the $20 
billion escrow fund, my understanding is, because I am not 
privy to those negotiations, is between the Associate Attorney 
General's Office and people at BP in Houston.
    Dr. Burgess. Now, at some point, though, those two 
universes have to merge. Is that correct? Otherwise you have a 
structure with no fund----
    Mr. Feinberg. You have got it.
    Dr. Burgess [continuing]. And they have got a fund with no 
structure.
    Mr. Feinberg. That is right.
    Dr. Burgess. When that merging occurs, will we on the 
Energy and Commerce Committee be made aware of what that 
structure looks like and how the fund then subsequently is to 
be administered?
    Mr. Feinberg. I would think so. You will certainly be 
entirely up to date on what I am doing with the Claims Facility 
and how that is working, what the protocol is, how we are 
drawing on the money. You will have--there will be full 
transparency as to what I am doing.
    Dr. Burgess. Well, let me just ask you this. When you 
worked 9/11, it was before my time, but when you worked 
administering that fund, who--for whom were you working?
    Mr. Feinberg. I was working for the Department of Justice 
and Attorney General John Ashcroft.
    Dr. Burgess. So you received a paycheck from the Department 
of Justice?
    Mr. Feinberg. I did--I worked on that assignment entirely 
pro bono.
    Dr. Burgess. OK. Had you been paid, though, likely would 
have come from the Department of Justice?
    Mr. Feinberg. Department of Justice.
    Dr. Burgess. On this--are you working pro bono on this 
account?
    Mr. Feinberg. No, I am not. The entire cost of this fund, 
the Facility, Gulf Coast Claims Facility, must, of course, be 
paid by BP. You can't ask the claimants to fund any part of it. 
You can't ask the government to fund any part of it.
    Dr. Burgess. Well, then that begs the question who is 
signing our paycheck?
    Mr. Feinberg. I am sure that BP is signing not only my 
paycheck but is signing the paycheck of everybody working in 
this independent Gulf Coast Claims Facility.
    Dr. Burgess. Do you see any difficulty in maintaining the 
independence with them holding the title of paymaster?
    Mr. Feinberg. I don't see any difficulty in maintaining my 
independence. I certainly do see the implication of your 
question, which is there could be a perception that since BP is 
paying, shouldn't we have more transparency or full disclosure, 
and I agree with that.
    Dr. Burgess. And I think that is where we would like to be 
of service to you and provide some help to you. When the 9/11 
compensation fund was set up, my understanding, and, again, I 
was not here, but that was set up under a Congressional 
authorization or Congressional charter. Is that correct?
    Mr. Feinberg. It was a federal statute.
    Dr. Burgess. Right, but it was as a direct result of action 
taken in the United States Congress.
    Mr. Feinberg. That is right.
    Dr. Burgess. But this is a little different.
    Mr. Feinberg. Very different.
    Dr. Burgess. There has been no action taken in the United 
States Congress, so if we invite you, for example, to our 
Committee on Oversight and Investigations, if Chairman Rush 
invites you back to this committee, may we expect your 
attendance?
    Mr. Feinberg. You certainly may with honor.
    Dr. Burgess. Well, I want to say as the Ranking Member on 
Oversight and Investigations and who knows what will happen to 
the world after November but as the current Ranking Member, we 
will welcome you back or welcome you to that committee some 
time this fall when you actually get funded to have a visit 
about how those funds are actually being dispersed, and of 
course, we also will be terribly interested in how the merging 
of the structure that you are producing and the funding that is 
yet to happen.
    You know, we had a field hearing the 1st of June down at 
Chalmette, Louisiana, Chalmette virtually destroyed in Katrina, 
built back, and now they are being destroyed by the oil spill 
and then subsequently the moratorium. There was a hotel 
operator there who talked about how he was keeping his cash 
flow going by borrowing, and having run a business before I 
know it is hard to keep your cash flow going if you are 
borrowing. And I asked him who was co-signing his loans with 
him, and he said his wife. I said, well, that is not exactly 
what I had in mind. I was kind of hoping BP was co-signing 
those notes with you, and he said, no such luck.
    Are we going to get to a point where that individual or an 
individual in similar circumstance can continue to maintain 
their business without facing future financial ruin?
    Mr. Feinberg. That will be my goal.
    Dr. Burgess. Thank you, Mr. Chairman, for your courtesy. I 
will yield back.
    Mr. Rush. The Chair recognizes Mr. Melancon for 5 minutes.
    Mr. Melancon. Thank you, Mr. Chairman. I appreciate you 
allowing me to waive on. If I would, I would like to submit a 
statement for the record since I am not a member of the 
subcommittee.
    Mr. Rush. OK.
    Mr. Melancon. Thank you, sir. I would like to welcome my 
friend, Ralph Brennan with the Restaurant Association. We 
worked many years ago on a promotion for Louisiana not only out 
of Louisiana but also internationally, and I guess my question 
to you is do you remember how many years it took us to build 
that reputation once we got that fund up and running?
    Mr. Brennan. Congressman, I don't remember the number of 
years, but it is a long time.
    Mr. Melancon. And so we are right now kind of reverting 
back to where we were, and we are going to have to have some 
ability as well as Alabama, Mississippi, Florida, and Texas to 
get that message back out once this Gulf has been cleaned up. 
So it is a long time coming.
    Mr. Brennan. Yes, sir.
    Mr. Melancon. I guess, Mr. Feinberg, is there any 
indication from BP of how long they are going to be in this 
thing, or are they thinking that this $20 billion is the all to 
end all, and is it going to done then?
    Mr. Feinberg. BP has made it very clear publicly and 
privately that if the $20 billion isn't enough, and I certainly 
hope it is, but if it isn't enough, they have promised to honor 
any additional financial obligations that might be their--its 
responsibility.
    Mr. Melancon. Mr. Feinberg, if I could, can you tell me 
what the hell this Alabama lawsuit is about?
    Mr. Feinberg. I am sorry?
    Mr. Melancon. This Alabama lawsuit. What is that about? I 
mean, BP is the responsible party. They are obligated not only 
for the money but paying for the administration of it, so 
somebody is filing--Alabama I think is filing suit.
    Mr. Feinberg. I am not----
    Mr. Melancon. That was something I had heard on the news 
the other day. I was wondering what that was all about. Maybe I 
didn't get my full information.
    Ralph, let me ask you as a person from Louisiana and for 
the Mississippi folks, I spent quite a number of days along the 
coast including the Mississippi Gulf Coast after Katrina. We 
are all in this thing together. I fully support every state 
that has been affected, whether it is from the storms or 
whether it is from BP.
    I wasn't here for the opening statement, and I apologize to 
all of you that--for that, but Ralph, is there anything since 
the discussions have started that has come to your mind that 
you wish you may has said or you might want to still say while 
I still have 2 minutes and 30 seconds?
    Mr. Brennan. Congressman, all I would say is--and I said 
this in my opening remarks, this is a long-term problem. Unlike 
Katrina it was a fixed event, it was over, we knew what we had 
to do. We don't know the long-term effects of this on 
especially Louisiana, the tourism industry and the seafood 
industry.
    And so we have to take an approach today, and we have to 
start today knowing it is going to be a long-term battle. I 
think you mentioned that earlier. We can't just end this at any 
date certain. It may go on for many, many years, and we have 
had conversations with the tourism industry officials and the 
seafood officials from Alaska, and after the Valdez incident 
they told us it has taken 5 to 10 years for them to overcome 
the effects of just that spill.
    Mr. Melancon. As I mentioned to my colleagues and others 
that will listen and the media, what our problem is, I guess, 
Mr. Feinberg, is what we don't see out there in the marshes in 
the Gulf that are the concerns for us for the future, and that 
is why, you know, knowing that you fully well see the long 
term, it is not like a 9/11, we are settled, and we are done, 
and we walk away. That is where I may not be around either 
because the Lord doesn't wish it for me or whatever, but I just 
hope that maybe that the people will be made whole in some way, 
shape, or form.
    I want to thank the Chairman for having this hearing as we 
continue to move forward to understand the problems that are 
faced by the people of the Gulf Coast of this country and hope 
that whatever we do the resolve will be such that it will be a 
model for the future.
    So, Mr. Feinberg, I pledge you and your folks full 
cooperation of my office as long as I am in office to help you 
with this problem, and again, Mr. Chairman and Ranking Member, 
thank you all for allowing me to waive onto the committee.
    Yield back the balance of my time.
    Mr. Rush. That said, the Chair wants to inform all the 
members, all the witnesses that you have been very patient, you 
have participated and informed the subcommittee far beyond our 
expectations, but we--and we certainly are appreciative of your 
sacrifice and your time that you submitted to this process. Mr. 
Dow, you had----
    Mr. Dow. Mr. Chairman, may I make one statement? One of the 
more moving and impressive things that I have seen is in 
September of 2008, you returned to the House on the floor to 
personally support the Travel Promotion Act which is now law. I 
do appreciate you understand what promotion can do.
    Mr. Rush. Yes.
    Mr. Dow. Your heroism being there but most important I am 
going to ask this committee and Congress if we can move forward 
and push for a $500 million fund. It is not in Mr. Feinberg's 
purview, but if we do this, we can limit significantly what is 
going to be spent in damages and recovery, and you understand 
as well as anyone. Thank you, sir.
    Mr. Rush. The Chair does understand and however, the 
committee will take that under consideration and give its 
intense insight or intense interest in that, and we will use it 
in the process to determine what our next step should be.
    But I want you to know that I do understand how important 
it is.
    And the Chair as was indicated earlier, really appreciates 
all the witnesses for their time. I know that Mr. Feinberg does 
have a 12:30 deadline that he has to meet. So with that in mind 
the committee now stands adjourned.
    [Whereupon, at 12:30 p.m., the Subcommittee was adjourned.]
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