Zones that are currently in the BP Settlement.
Identifying the Zones
Previously the Zones of the BP Settlement were fairly simple, based on distances from the shoreline.
For example, Zone A was within 0.5 miles of the shoreline, Zone B was over 0.5 miles, but up to miles. Zone C was over 1.0 miles, but under 2.0 miles. Zone D was over 2.0 miles.
After BP’s acceptance of the BP Settlement, much has changed. The same 4 Zone structure exists with A, B, C and D; however, the zones have different distance requirements and are affected by Class type of the BP Settlement.
BP Settlement Class Type Affects the Zone in Which You are Located
1. Property Damage & Lost Sales Claims: The Zones are broken up here so specifically that YOU may be in Zone A, but your neighbor across the street may be in Zone B.
The difference here is that Zone A only needs to show the financial loss, Zone B needs to show the financial loss AND that the loss was CAUSED by the Spill.
2. Seafood Harvester Claims: Are similarly broken up as Property Claims in the BP Settlement, but not with such finite detail. Zone A is broader, but is etched closer to the shoreline. Use the business address, or employment address, should be the address of your home port for the BP Settlement. Essentially, the home port address should be the address of where you dock your boat.
3. Economic Loss Claims: For the BP Settlement, Zone A is sporadic, applies to the Florida Keys, around the New Orleans area, Orange Beach, AL and Gulfport, MS, with some areas in Mobile, AL. The other Zones that apply are Zone C. Zone B is not as broad as Zones A, C and D, with some occurrences around Tampa Bay, North of Pensacola for a few miles, small spots in MS, AL, and LA.
4. Medical Claims: Don’t really have a Zone in the BP Settlement. You just need to prove you worked on Clean-Up, you were exposed and had suffered an injury at the time you worked on Clean-Up, OR have chronic symptoms.
For Medical Claims of the BP Settlement, you could be a resident in Ohio who worked on the Spill Clean-Up. You will need to prove exposure, employment and injury, but so long as you have the symptoms, or were injured you still have a claim.
Zones Complexity, Confusion or Much Ado About Nothing?
For the BP Settlement, you need to conceptualize this, or make a concept out of this note here:
Oil has the golden touch, wherever the oil physically touched the beaches that specific area will be Zone A.
Areas next to that area will be Zone B or Zone C. Areas over 2.0 miles from the Zone A areas will most likely be Zone D, under the BP Settlement.
Zones C and D will have the largest problems with showing causation under the BP Settlement. Everybody suffered a loss after the Spill, but you must show that you suffered a loss BECAUSE of the Spill.
Is the Zone System of the BP Settlement it Really That Complicated?
Yes and no. The Zone system of the BP Settlement was intended to set up more categories in order to end the uniform treatment of different business types that was experienced under the GCCF.
The BP Settlement also specifically identifies BP’s liability to many more people and businesses than what had been experienced under the GCCF.
Our licensed claims adjusters have the ability to decipher the Zoning sections, project potential losses and offer the argument of your claim value for your BP Settlement claim.
This will be a brief overview of the different types of Zones that are currently in the BP Settlement.
Identifying the Zones
Previously the Zones of the BP Settlement were fairly simple, based on distances from th shoreline.
For example, Zone A was within 0.5 miles of the shoreline, Zone B was over 0.5 miles, but up to miles. Zone C was over 1.0 miles, but under 2.0 miles. Zone D was over 2.0 miles.
After BP’s acceptance of the BP Settlement, much has changed. The same 4 Zone structure exists with A, B, C and D; however, the zones have different distance requirements and are affected by Class type of the BP Settlement.
BP Settlement Zones and types of Claims
1. Property Damage & Lost Sales Claims: The Zones are broken up here so specifically that YOU may be in Zone A, but your neighbor across the street may be in Zone B.
The difference here is that Zone A only needs to show the financial loss, Zone B needs to show the financial loss AND that the loss was CAUSED by the Spill.
2. Seafood Harvester Claims: Are similarly broken up as Property Claims in the BP Settlement, but not with such finite detail. Zone A is broader, but is etched closer to the shoreline. Use the business address, or employment address, should be the address of your home port for the BP Settlement. Essentially, the home port address should be the address of where you dock your boat.
3. Economic Loss Claims: For the BP Settlement, Zone A is sporadic, applies to the Florida Keys, around the New Orleans area, Orange Beach, AL and Gulfport, MS, with some areas in Mobile, AL. The other Zones that apply are Zone C. Zone B is not as broad as Zones A, C and D, with some occurrences around Tampa Bay, North of Pensacola for a few miles, small spots in MS, AL, and LA.
4. Medical Claims: Don’t really have a Zone in the BP Settlement. You just need to prove you worked on Clean-Up, you were exposed and had suffered an injury at the time you worked on Clean-Up, OR have chronic symptoms.
For Medical Claims of the BP Settlement, you could be a resident in Ohio who worked on the Spill Clean-Up. You will need to prove exposure, employment and injury, but so long as you have the symptoms, or were injured you still have a claim.
Zones Complexity, Confusion or Much Ado About Nothing?
For the BP Settlement, you need to conceptualize this, or make a concept out of this note here:
Oil has the golden touch, wherever the oil physically touched the beaches that specific area will be Zone A.
Areas next to that area will be Zone B or Zone C. Areas over 2.0 miles from the Zone A areas will most likely be Zone D, under the BP Settlement.
Zones C and D will have the largest problems with showing causation under the BP Settlement. Everybody suffered a loss after the Spill, but you must show that you suffered a loss BECAUSE of the Spill.
Is the Zone System of the BP Settlement is it Really That Complicated?
Yes and no. The Zone system of the BP Settlement was intended to set up more categories in order to end the uniform treatment of different business types that was experienced under the GCCF.
The BP Settlement also specifically identifies BP’s liability to many more people and businesses than what had been experienced under the GCCF.
Our licensed claims adjusters have the ability to decipher the Zoning sections, project potential losses and offer the argument of your claim value for your BP Settlement claim.
BP Claims: Business Calculations for the BP Settlement
This report will inform you of the new BP Settlement system and how it will most likely be applied to your business. There are many changes from the GCCF system, we expect the Court Supervised BP Claims Process will be an improvement, but we do not preach its perfection. This report will discuss Final Payment Offers, the new calculations, the new Zone system and how to go about readying your business’s BP claim for the new process. The examples below are our best guesses with what we know of the new process.
If your business has filed BP claims and accepted the Final Payment Offer on its BP claims, your business is not entirely finished, yet. The Final Payment Offers were used to write off BP claims such as your business’s BP claim. The attorneys negotiating the settlement agreement have recognized this issue and are attempting to make BP re-process BP claims that have been concluded with a Final Payment Offer. On the other hand, BP claims that have accepted the Quick Payments, may not be as lucky. BP is attempting to hold out on Quick Payment BP claims, however, this organization will advocate for BP claims that have accepted the Quick Payments. If your business’s BP claim had accepted the Final Payment Offer, all amounts paid by BP will be deducted from the loss calculated under the new Court Supervised BP Claims Process, at least that is what we have been hearing.
BP Claims Settlement Calculations
This will bring us to how the calculations will be executed for your business’s BP claims under the new System. The Court Supervised BP Claims Process will apply a Risk Transfer Premium (RTP) similarly used in disastrous weather scenarios. Essentially, the calculation will most likely be on a one-tenth scale from 1.0 to 5.0 where your 2010 loss will be calculated, then multiplied by your assigned RTP. So, the calculation will look like:
2010 Loss X Your assigned RTP = Your Award Amount, or BP’s liability on your BP claim.
The multiplier value for your BP claim will depend on your locale to the Oil Spill, the relation your business has to the Gulf Resources of tourism and fishing. The further away your business is located from the Spill, and the less likely your business depends on tourism, the lower your multiplier.
When filing your BP claims, you should keep in mind that your business’s location matters. As previously mentioned, your multiplier will be affected by your distance from the soiled beaches and wetlands. So, a car dealership, for example, across the street from a previously soiled beach, will get a higher multiplier than a car dealership that is 2.0 miles from the soiled beach. Furthermore, a car dealership across the street from the beach will receive a lower multiplier than the hotel next to it because of the lack of traditional reliance upon tourism.
Keep in mind when you are preparing your BP claims, gross and net sales will not be the figure used to calculate losses. The Oil Pollution Act prevents this. The figure you should use is the gross profits figure for your BP claim. Gross profits equal net sales, less cost of goods/services. The new system will take your worst three Post-April 2010 months, average those months and apply that loss figure to May to December 2010 as your monthly loss. The monthly loss will be totaled, then the RTP will be applied. This information will aid you on your BP claim.
Now, onto locale for your BP claim, using the two aforementioned car dealerships as an example. The Court Supervised BP Claim Process has split the Gulf Region in three zones:
Zone A: Will be all those businesses with BP claims 1/2 mile, or less, away from the beaches from Galveston, TX to Key West, FL.
Zone B: Will be all those businesses GREATER than 1/2 mile from the beaches from Galveston, TX to Key West, FL.
Zone C: Will be all those businesses greater than 1.0 miles from the beaches from Galveston, TX to Key West, FL.
These are educated guesses of how the zones will work.
So, a car dealership with a BP claim in Zone A will be assigned a greater RTP than a car dealership in Zone B and a hotel with a BP claim in Zone A will receive a higher multiplier than the car dealership in Zone A, or B. You can see how the calculations will be correlated with business type and distance.
BP Claims Solutions for Business
You can see that the BP claims process is still complicated, however, you can see that it is more transparent than the GCCF system. If you have any questions, or need assistance in filing a BP claim, please do not hesitate to contact us at 1-800-BP-CLAIM or fill out the form to the right. Adjusters and consultants charge 15% and Attorneys charge from 20% to 33.3% to handle your BP Claims.
Businesses and the BP Settlement
The BP Settlement is coming up in just less than a month’s time now and will completely transform the whole GCCF methodology system to a better, fairer and more transparent system currently known as the, “Court Supervised Claims Program.” The new system will not be as autonomous as it was under Feinberg because there will be much more judicial supervision under the new BP Settlement. If you happen to be a business owner, the BP Settlement will be able to pay you, even if you have been paid under the GCCF. We will discuss qualified Claimants, the part of business income that is awarded and how the new Risk Transfer Premium (RTP) may pay out to you, even if you were previously denied.
We must discuss who can get paid, in the first place. So far, the BP Settlement has listed potentially non-payable classes, which we will list. If you belong to one of these groups, you will NOT get paid under the BP Settlement:
BP Settlement Exclusions
1. Financial Institutions: These will most likely include mortgage firms, accounting firms, banks, financial advisories, stock brokerages, etc.
2. Casinos and Racetracks: this is self-explanatory. These were paid at one time, but will not be paid under the BP Settlement. There is somewhat of a give-and-take negotiation going on with the BP Settlement. On one side, businesses that did not qualify under the GCCF Methodology, will comply under the BP Settlement, and vice versa. Arguably, more businesses will get paid under the BP Settlement, even though some classes may be excluded, that were not excluded before. Keep in mind that the negotiations are not complete and that some of these policies are subject to change.
3. Oil & Gas Industry: these will include the rig contractors, drillers and processors of this industry.
4. Insurance Companies: This is self-explanatory.
5. Defense Contractors: This is self-explanatory. So, companies like Lockhead Martin, Northrop Grumman and smaller contractors will not get paid. The justification is that a defense contractor’s income is generated, or lost, by government actions and not by the BP Spill of 4/20/10.
6. Moratorium Claims: Basically, this reverts back to the Oil & Gas Industry businesses that will be denied. There is a possibility that, with our influence, some Moratorium Claims may be paid. Such businesses may include catering businesses that suffered from the interference of business caused by BP’s Spill. So, companies that directly profit from oil and gas will NOT get paid under the BP Settlement, but auxiliary companies that serve the oil and gas companies have a possibility of getting paid. Not all is lost for Moratorium Claims.
After listing the businesses that WILL NOT get paid, you must be wondering WHO WILL get paid under the BP Settlement. So, let’s start with this,
The BP Settlement will Compensate any Business affected by the Gulf Oil Spill Based on Proximity to the Gulf and Industry.
“Any [business] that asserts it had an economic loss.” Common sense would dictate that certain limits will most likely apply, but the RTP will open many doors for businesses who could not get paid before. The RTP will be a multiplier, between 0.1- up to 5.0 and will be applied to your business type and locale to the Affected Areas. The ‘Affected Areas’ will be the areas within 0.5 miles from the beaches actually soiled by BP’s oil. If you are a business that directly depends on the Gulf Resources of seafood and tourism, and you are located on the beach, your multiplier should be at its highest. If you show an indirect dependency on tourism and/or, but are located on the beach, then your multiplier will tick downwards. If you show an indirect dependency on a Gulf Resource, and you are located off the beach, then your multiplier will be even lower. At the very least, if you are not in the excluded categories, you have a chance of getting paid.
What business figure gets paid? The BP Settlement will be OPA (Oil Pollution Act) driven. The OPA only allows for the Gross Profits figure to be reimbursed. So, when calculating your loss, do not use your potentially lost, total sales figure, that amount will not get reimbursed. “I lost $100,000 in business,” will not get awarded. “I lost $50,000 in gross profits from $100,000 in lost, total sales.” The $50,000, times your BP Settlement multiplier, will get reimbursed.
Gross profits, remember, are you Net Sales minus Cost of Goods. So, say you sell fried grouper sandwiches on the beach, in Perdido Beach, Alabama at your seafood restaurant. Obviously, you rely upon the Gulf grouper to make your product and you rely on the New Englanders to come down to the area to buy them. Let’s say you sell the sandwich for $9.00. The hoagie bun costs $0.50, the toppings are $1.00, the corn oil about $0.10 and the grouper cost you $3.00. You have a total cost of goods of $4.60. Notice, utilities and rent/mortgage are not included in the calculation. You have a profit, 9.00-4.60, of $4.40, a margin of 48.88%. This is pretty direct and the BP Settlement should apply a similar standard. Considering the GCCF Methodology worked out a magical LOI% that nobody knew how to calculate, this is an improvement. Back to the task at hand, under the OPA and BP Settlement, only the $4.40 will be reimbursed, NOT the $9.00. But wait, what about the multiplier? Your Gross Profit is $4.40, you are right on the beach, there was oil on your beach and the whole area was a ghost town during season. Let’s make this argument here: you did not catch the grouper, so your multiplier ticks downward. You are on the beach and you have local customers in addition to tourist-customers. You do not ENTIRELY rely upon tourists ONLY, so your multiplier will tick down again. Let’s say your multiplier is dropped from 5.0, tick down to 4.5, then again to 4.0. Your $4.40 will be multiplied by 4 to equal $17.60. Does that make a bit more sense?
BP Settlement may Shift
Please keep in mind that the BP Settlement is not complete and is still in its negotiations process. We cannot be certain how the multiplier will work as those details have not been worked out. We do know that the RTP will most likely exist and will work in a similar fashion described above. However, it is not possible to be specific. At the very least, we can see that the BP Settlement will be more transparent than the GCCF system and the calculations will make sense to us all. The BP Settlement will be an improvement, not a perfection, of the reimbursement system.
Stay tuned, keep checking this site, we will keep releasing news as it unfolds. We are here to help guide you through the BP Settlement and its process soon to be released. Thank you for reading.
We will help you with Your BP Settlement
Identifying the Zones
