Final Rule of Victim Compensation Fund Means “Substantial” Increase in Awards
By Justin Hill
WASHINGTON, March 07–Family members of the victims of the September 11 terrorist attacks will receive a “substantial” increase in the financial awards they can receive from a federally administered fund as a result of a final rule announced yesterday for the administration of the Victim Compensation Fund.
“The net check coming from the United States Treasury to each of these individuals, each claimant, we believe, will be substantially more,” special master Kenneth Feinberg said. “I personally urge every eligible claimant to file under this program. The programáis vastly preferable to any litigation.”
The average award will be about $1.85 million, nearly $200,000 more than what was allotted under the temporary guidelines announced in December, according to Feinberg.
But the new rules drew mixed reaction from Connecticut lawmakers.
“The rule, in my opinion, does not reflect the intent of the Congress” when it passed the bill establishing the Victim Compensation Fund, said Rep. Jim Maloney (D-5th).
But Rep. Christopher Shays (R-4th) said the new rule is “probably the best that could be expected under the law. The average award is going to go upá, and people will get the full amount of lost income,” he said.
Under the new rule, announced four days before the six-month anniversary of the terrorist attacks, the pain and suffering award would be doubled to $100,000 per dependent in addition to the base $250,000 each family would receive. “Speculative” income sources such as Social Security benefits for surviving family members and workers’ compensation would not be used to reduce the government awards based on victims’ income. Moreover, income sources funded by the victim-such as 401(k) plans, pension plans and life insurance-would not be deducted from so-called economic awards.
However, Feinberg said, “we will offset life insurance. We will offset other death benefits. Why? Because the statute requires it.”
Maloney, expressing dissatisfaction with the final rules, said, “It appears that the final rule does not remove the [$250,000] capá. The Congress did not have a cap.”
Feinberg defended the $250,000 cap on the base reward for pain and suffering, saying that it is the same sum awarded in other federal death benefit programs.
The new rules would also extend eligibility to injured civilians who sought medical treatment within 72 hours instead of the original 24 hours and would remove the time limit for rescue workers who responded to the Sept. 11 emergency.
The new rules for the fund also allow people interested in the fund to consult with Feinberg’s office to decide if they want to enter the program without making a binding agreement to join.
“We will let them come in and sit down with one of our people and get a good ballpark estimate of how the collateral offsets will be treated,” Feinberg said. “We are trying to help them make an educated choice on whether to come into the program or not.”
Donald Vadas of Westport, whose 37-year-old son, Bradley H. Vadas, was killed in the attack on the World Trade Center in New York, said he is going to speak to someone associated with the fund to see how much he would receive before deciding if he is going to sign on.
“This is a no-brainerá. You can talk to them without making a commitment,” Vedas said. “That’s something they needed to doá. [Under the old rule] it’s like getting married to someone I don’t know.”
The Victim Compensation Fund was created by Congress and is part of the Air Transportation Safety System Stabilization Act, which President George W. Bush signed on Sept. 22.
A number of relatives of victims are concerned that by taking part in the government compensation program they must waive their right to sue. But Feinberg said “the litigation option isn’t real in this case.” He cited as reasons the length of any litigation against the airlines, the fact that suits must be filed in federal court in New York City and the congressional decision to cap the airlines’ total liability at $6 billion, equal to the amount he estimates the federal program will ultimately award the victims.
Victims’ families must file claims before the end of 2003. Awards will be distributed 120 days after the claim has been deemed complete.
The announcement of the final rule comes after months of comments by both victims’ families and elected officials.
Feinberg said, “The suggestions have not fallen on deaf ears.”
According to the Justice Department, about 350 people have filed for an award from the fund so far. The new rules will apply to them.
Published in The Hour, in Norwalk, Conn.
