Recovery from oil spill is a slippery business
In September, British Petroleum (BP) finally fully killed the Deepwater Horizon well that had been leaking oil into the Gulf of Mexico since the rig above it exploded and sank in April. However, the struggle to recover from the spill goes on for many local governments, and officials with the Washington-based National Association of Counties (NACo) say questions remain about how much lost tax revenue locals will be able to recover.
Some oil remains buried under several inches of sand on parts of the beach at Gulf Shores, Ala., but city spokesman Grant Brown says that between mid-October and December, contractors will conduct a final clean up to remove those remnants. However, the sealing of the well came after this year’s summer tourism season was over, and officials estimate that the city will have lost around $2.9 million in tax revenue between July and the end of the year, Brown says. “In addition to that, of course, there are direct expenses that have been incurred.”
While the city has received some reimbursement for the direct expenses, Brown says they are still waiting to hear about reimbursement on the lost tax revenue. Seeking reimbursement for lost tax revenue will be “the larger problem,” says Tarrant County, Texas, Judge Glen Whitley, head of NACo’s Gulf Counties & Parishes Oil Spill Task Force, which was created in August. For example, officials must differentiate losses that resulted directly from the oil spill from losses caused by the moratorium on offshore drilling implemented by the Obama administration after the BP leak began. “[BP has] told the Louisiana parishes directly that they will not be honoring [government tax revenue] claims associated with losses from the moratorium,” says Stephanie Osborn, deputy director for NACo’s County Services Department.
There are some indications that next year will be better, Brown says. For example, the “snow birds” — usually older residents of northern states who regularly vacation in the town during the winter — have not cancelled their reservations beyond the normal number. “So, the winter looks like it’s going to be a normal winter,” Brown says. “All indications are we should have a really good spring.”