Can the Deepwater Horizon Trust Take Account of Ecosystem Services and Fund Restoration of the Gulf?

• Date: 01 November 2010
• Author: Carrie Presnall, Laura López-Hoffman, and Marc L. Miller

11-2010 NEWS & ANALYSIS 40 ELR 11129

Can the Deepwater Horizon Trust

Take Account of Ecosystem Services

and Fund Restoration of the Gulf?

by Carrie Presnall, Laura López-Homan, and Marc L. Miller

Carrie Presnall is a Master’s student and Peace Corps Fellow at the University of Arizona School of Natural Resources

and the Environment and the Udall Center for Studies in Public Policy in Tucson, Arizona. Laura López-Homan is an

Assistant Professor in the University of Arizona School of Natural Resources and Environment and an Assistant Research

Professor at the Udall Center for Studies in Public Policy. She is the lead editor of Conservation of Shared Environments:

Learning From the United States and Mexico, the rst volume in the new series e Edge: Environmental Science, Law,

and Policy (Univ. of Arizona Press). Marc L. Miller is the Ralph W. Bilby Professor at the University of Arizona James E.

Rogers College of Law. He currently serves as the lead series editor for e Edge. See http://www.edge-books.com.

November 1, 2010

Dear Mr. Feinberg,

We write today to emphasize the importance of restora-

tion as an appropriate and necessary goal of the Deepwater

Horizon compensation fund, and to note the centrality of

the concept of ecosystem services to the proper assessment of

compensation for environmental harms and strategies for

achieving ecosystem restoration. To the extent that the exist-

ing Trust authority is not su cient to take account of these

concepts, we encourage you to seek broader authority.

Restoration as Part of Compensation

President Barack Obama has repeatedly emphasized the

importance of looking not just to the past with respect to the

Gulf, but to the future as well. In his June 12 Oval Oce

address, President Obama said: “Beyond compensating the

people of the Gulf in the short term, it’s also clear we need

a long-term plan to restore the unique beauty and bounty of

this region.” In late August, BP CEO Bob Dudley, speak-

ing to the Southern Governors’ Association, said that BP will

“make this right” and restore the region. e BP website reaf-

rms this commitment, stating that “[a]t BP, we have taken

responsibility for the cleanup in the Gulf,” a nd “[w]e have

committed to do everything we can to make thing s right in

the Gulf region, working as long as it takes, on the ocean, on

the shore and in the community.”1

However, there appears to be some tension between t his

broad and commonly asserted commitment to restore the

Gulf and the scope of the Deepwater Horizon Oil Spill Trust

and the Gulf Coast Claims Facility (GCCF), which you now

1. BP, Making It Right—Highlights, http://www.bp.com/extendedsectiongeneri-

carticle.do?categoryId=9034427&contentId=7063885.

administer. e GCCF was established “for the purpose of

administering, mediating a nd settling ... Damage Claims.”

e Trust document denes damage claims as follows:

3. “Damage Claims” shall be limited to amounts owed by the

Grantor pursua nt to: (i) claims resolved a nd settled by the

GCCF (“GCCF Claims”); (ii)amounts owed by the Grantor

pursuant to nal judg ments or settlement agre ements that

are resolved outside of the GCCF process and relate to the

Oil Spill (“Other Resolved Claims”); (iii) natural resource

damage cos ts (including assessment costs) pertaini ng to the

Oil Spill (“NRD Claims”); and (iv)state and local govern-

ment re sponse costs pertaining to the Oil Spill (“Govern-

ment Response Costs”)....2

Do you believe that you have the authority under t he

GCCF claim funds to pay for restoration projects, or do you

believe your responsibility is limited to a narrower remedy

of xed payments for environmental harms suered to date

from t he oil spill? If you cannot fund restoration projects,

how will you compensate for ongoing and future harms? If

the Gulf ’s ecosystems are not restored, people w ill continue

to suer well into the future from an ecos ystem that no lon-

ger provides the economic and cultural services it once did.

If, at the end of the day, all current ha rms from the Deep-

water Horizon spill have been compensated, but the ecologi-

cal systems upon which much of the region’s economy rests

are not restored, the president and BP will have made empty

promises to restore the beauty and bounty of the region.

2. Deepwater Horizon Oil Trust Agreement, Aug. 6, 2010, available at http://

media.nola.com/2010_gulf_oil_spill/other/Trust%20Agreement.pdf.

Copyright © 2010 Environmental Law Institute®, Washington, DC. reprinted with permission from ELR®, http://www.eli.org, 1-800-433-5120.