The Coast is Clear
There is a constant murmur during the July 27, 2010, Congressional hearing before the Committee on Energy and Commerce. As politicians shuffle in and out from their burgundy leather seats, Ken Feinberg, made famous for distributing insurance claims to 9/11 victims and their families, stays still, hunched over the tabletop microphone in front of him.
He is at the end of the table and photographers from the nation’s biggest news organizations are seated on the floor below him, snapping away as he answers questions about how he will distribute the $20 billion dedicated by BP to repay damages from the historic oil spill.
“I answer to the people of the Gulf, not the administration or BP,” Feinberg says in a thick New England accent that stands in stark contrast to the genteel dialects of the four men seated to his left.
Along with Feinberg are restaurant and tourism leaders from the Gulf Coast. They have come all the way from their oceanfront businesses to the stagnant heat and humidity of the nation’s capital to plead their case. They want to set the record straight, they want money, and they want them both now.
“The rest of the world and the rest of America need to know that it’s safe to get back in the water,” says Rip Daniels, vice president of the Mississippi Gulf Coast Tourism Commission.
It is a little more than four months after the April 20 explosion on the Deepwater Horizon oil rig. In addition to claiming 11 lives, the spill was like throwing a 2-ton boulder into a tranquil pond. Within days it became obvious that the ensuing oil spill would be worse than any in the world’s history. Americans sat glued to their televisions as experts from top universities and even NASA tried to cap the wellhead that was spewing 62,000 barrels of oil a day into the Gulf of Mexico. Meanwhile, business owners along the Gulf sat waiting, waiting for customers to return to their stores and for the media frenzy to die down.
It was the ensuing coverage of the spill with images of oil-soaked birds and flashbacks to the devastation of Hurricane Katrina that quickly did more damage to local businesses and franchisees than the oil spill itself.
“Many ask if there’s oil on the doorsteps of New Orleans; and New Orleans is miles inland,” says Ralph Brennan, president of Ralph Brennan Restaurant Group in New Orleans, to the group of legislators looking back at him. There is desperation in his voice, along with the others who have come to request $500 million in marketing funds to reverse what the talking heads have done over the last 12 weeks.
“The media must be held accountable for its actions,” says Keith Overton, chairman of the Florida Restaurant and Lodging Association, explaining that after the President’s visit to Pensacola, Florida, a cable channel superimposed dripping oil over the background of its coverage of the event.
“Many of us operate at or slightly above minimum wage, and BP was employing people at $11 an hour upward.”
Today, one year after the spill, the media firestorm is still fresh on the mind of Wendy Warren, vice president of communications at the Louisiana Restaurant Association. “The phone started ringing on April 21,” she says. “When people got over the fact that 11 people died and that the oil was gushing into the Gulf of Mexico, people went, ‘Oh my god, this is going to be huge.’ And by that I mean the media.”
Jackson, Mississippi–based Mike Cashion, executive director of the Mississippi Hospitality & Restaurant Association, sits in his office rubbing his forehead. “The perception was that every food item that came out of the Gulf was dripping in oil, and that couldn’t have been further from the truth,” he says.
What was the truth was that the spill occurred just two weeks before the beginning of oyster season in the region. Since fishermen traditionally work to exhaust their stocks of product before a new season begins, locals had been slashing prices on oysters and shrimp in anticipation of the upcoming fishing season. That trend quickly reversed, as businesses realized the impact the spill had on supply chains across the coast. Prices quickly soared since fishermen either couldn’t fish in their regular waters or were recruited by BP as part of the Vessels of Opportunity program to help with the clean-up effort.
While prices of shrimp and oysters hit record highs, causing many restaurateurs to pull the foods from menus altogether, businesses were hit worst by the absence of tourists. “It was very obvious that they weren’t going to arrive, even though we didn’t get the worst of it,” says David Cadwallader, owner of a Biloxi, Mississippi, Sweet Peppers Deli unit. “I just think people became depressed. They kept showing that the beaches were empty, and the jet ski rental guys were just sitting around. That proliferated, and people realized the season wasn’t going to take off.”
Cadwallader, like many in the area, saw his sales fall following the oil spill. “In May we were down $8,000 in sales, and it drifted down every month and stayed at about $8,000. It remained like that until probably the end of the year,” he says.
RPM Pizza, which owns 135 Domino’s locations across Louisiana and Mississippi, followed a similar downturn. “We were up 6 or 7 percent, then all of a sudden we were flat,” says the company’s COO Richard Mueller, describing the company’s performance before and after the spill. “In our business, a couple percentage points in sales is huge because the margins are so thin. And we haven’t seen the trend come back yet.”
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