Realtors are pressing Kenneth Feinberg, who runs the $20 billion claims fund for victims of the BP Plc oil spill, to reimburse them for their lost business in states along the Gulf of Mexico.
Feinberg, who has called real-estate agents a “major political force,” met yesterday in Washington with the National Association of Realtors, a trade group, and with industry representatives from Texas, Louisiana, Mississippi, Alabama and Florida to discuss the pleas for aid, said Malcolm Young, president of the Louisiana Realtors association.
The spill’s effects on Realtors may provide an early test of Feinberg, who must determine who was most affected by the biggest U.S. oil spill. Feinberg will have to sort out effects on a housing market already in crisis and weigh claims for lost sales and rentals in areas never tarred by the oil.
“You’re talking about lots of money” if “subjective claims” of lost business all along Florida’s west coast are included, Wendell Davis, president of the Florida Realtors, said in an interview. Claims solely from the state’s northwestern Panhandle, where beaches were directly affected and property sales are down 45 percent from previous years, may reach $30 million, he said.
Amy Weiss, a spokeswoman for Feinberg, declined to comment on yesterday’s meeting.
The Realtors and Feinberg are close to agreeing to a set of criteria he will use, Davis said.
“Our focus has been getting a seat at the table and making sure we are treated fairly,” he said.
1.2 Million Realtors
The National Association of Realtors, a Washington-based membership organization of real-estate agents, has 1.2 million members, according to Lucien Salvant, a spokesman.
The organization spent $8 million lobbying in Washington during the first six months of this year, more than AARP, the group that advocates for people 50 and older on issues such as health care, according to the Center for Responsive Politics in Washington.
Feinberg, a Washington lawyer who previously administered claims for victims of the Sept. 11 attacks, has commented on the Realtors’ persistence and their influence.
“I’m hearing from them constantly” and they are a “major political force,” Feinberg said in testimony before the House Judiciary Committee on July 21.
While Feinberg questioned the legal standing of some claims from brokers and agents, he said they made a “credible argument” that “something should be done for them.”
The Gulf Coast Claims Facility that Feinberg will administer is scheduled to start operating on Aug. 23. The fund was created by BP and the Obama administration.
The negative image created by the oil spill could damage real-estate markets for years, Davis said.
“That threat is not going to go away for a very long time,” he said.
The spill cost Molly McKinnon, a Realtor based in Pensacola, Florida, a commission of $8,750 on a property near Biloxi, Mississippi, she said in an interview.
A client canceled the contract, saying she didn’t think she’d be able to rent out the condo. According to McKinnon, BP officials have said the claim she filed on June 28 must “wait on Feinberg to decide what to do.”
She said she has had to cancel her health insurance and her own home is close to foreclosure.
“I’m just broke, like a bunch of other Realtors,” McKinnon said.