By Jonathan Stempel
(Reuters) - The special master overseeing a U.S. government fund to compensate victims of the Sept. 11, 2001, attacks on Friday said future awards will be significantly reduced, typically by at least 50 percent, because the fund is running short of money.
Rupa Bhattacharyya, the special master, said the reduction in payouts from the September 11th Victim Compensation Fund is necessary because the $2.375 billion remaining in the $7.375 billion fund is not enough to compensate the thousands of additional eligible victims and family members.
"I am painfully aware of the unfairness of this plan," Bhattacharyya said on a conference call with reporters. "It is the best that we could do."
Roughly $5 billion has been awarded on more than 21,000 claims, about three-quarters of which came from New York. Bhattacharyya said the fund would have needed to be $12 billion, instead of $7.375 billion, to compensate everyone fully.
Nearly 3,000 people died on Sept. 11, 2001 when airplanes hijacked by al Qaeda crashed into New York's World Trade Center, the Pentagon outside Washington, and a Pennsylvania field.
The fund opened in late 2011 for first responders including police officers and firefighters; cleanup and construction crews; and people who lived, worked or went to school near the attacks. A similar fund ended operations seven years earlier.
Nearly 40,000 compensation claims have been filed in the last seven years, but half were filed in 2017 and 2018. Thousands more are expected.
Bhattacharyya attributed the faster pace of claims to the growing number of cancers, other serious illnesses and deaths linked to the attacks, and the fund's warning in October that future payouts might be reduced.
The new procedure calls for base payouts, before offsets for sums awarded from other sources for the same injuries, to be reduced by 50 percent for claims submitted before Feb. 2, 2019, and 70 percent for claims submitted later.
Bhattacharyya said she "could not abide" by alternatives that would have awarded nothing to eligible victims.
People have until Dec. 18, 2020 to file claims.
(Reporting by Jonathan Stempel in New York; editing by Leslie Adler and Marguerita Choy)