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Biden aides weigh economic aid for East Palestine after derailment

The administration wants to make Norfolk Southern pay for any costs but is exploring backup options

People gather at an informational community meeting held by River Valley Organizing in East Palestine, Ohio, after a train derailment spilled hazardous chemicals. (Rebecca Kiger/For The Washington Post)
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White House aides are weighing if or how they can provide economic relief for East Palestine, Ohio, after the town was affected by a train derailment last month that spilled hazardous materials, although it remains unclear what form the relief could take, according to four people who were briefed on the matter.

The planning is taking place amid intense scrutiny of the Biden administration’s response to the disaster, which has raised the prospect of potential health risks and long-term harm to the drinking water and air in the area. Sens. Sherrod Brown (D) and J.D. Vance (R) of Ohio, along with other Democrats and Republicans, separately released legislation Wednesday that primarily aims to improve rail safety in response to the derailment.

The exact details of any potential White House action are unknown, and the administration says it is determined to force Norfolk Southern, the company that owns the train that derailed, to pay for the harm caused to residents. The administration may also face challenges in crafting a financial aid package for a town that has fewer than 5,000 people. But many residents already have decided to leave the town or keep their children out of school, putting pressure on the federal government to help the reeling Rust Belt community.

As part of that process, Biden aides have looked at whether existing federal money can be used to provide small-business loans to East Palestine, two of the people briefed on that plan said. The administration also is considering infrastructure improvements in the area. The talks are described as highly preliminary, and administration officials stressed that it remains possible the White House decides against devoting economic aid to East Palestine. All the people discussing the plans spoke on the condition of anonymity to describe early talks.

White House spokesman Abdullah Hasan said in a statement: “The EPA is making Norfolk Southern pay for its mess so taxpayers don’t have to, and will continue to push the company to provide for everything that the people of East Palestine need now and in the future.”

Biden administration officials also have been adamant that they have responded appropriately to the disaster and have accused the Trump administration of abandoning rail safety rules that were proposed during the Obama era.

Lawmakers in both parties also have emphasized that Norfolk Southern should pay for any relief plans. The Environmental Protection Agency has ordered Norfolk Southern to take measures including paying for the cleanup of all contaminated soil and water and also paying the EPA’s cleanup costs. The company says its financial commitment to East Palestine totals nearly $8 million, including $300,000 for the local school district and $825,000 for the local fire department. But federal officials may want to send additional funds to the region.

“When I visited East Palestine last week, you told me how the train derailment has upended your lives and how concerned you are about the safety of your air, water, and land. Many of you have also reached out to Norfolk Southern to share your fears, your anger, and your frustration,” Norfolk Southern chief executive Alan H. Shaw said in a public letter last month. “We are here and will stay here for as long as it takes to ensure your safety and to help East Palestine recover and thrive.”

In an interview on CNN on Tuesday, Transportation Secretary Pete Buttigieg also said the Biden administration supports a range of measures to impose tougher rules on the rail industry, including higher maximum fees on firms and legislation to give federal officials a “freer hand” on regulations governing braking. Buttigieg made the comments in response to criticisms from Senate Minority Leader Mitch McConnell (R-Ky.), who blasted the transportation secretary’s handling of the crisis.

“The freight rail industry has wielded a lot of power here in Washington. I would love to see leader McConnell join us in standing up to them,” Buttigieg said. “There are specific things that could be done right now.”

The bipartisan legislation introduced Wednesday focuses on rail safety measures such as higher penalties for safety violations, new requirements for trains moving hazardous materials, and hazardous materials training for first responders. In a Washington Post op-ed on Sunday, Vance called for a Paycheck Protection Program for East Palestine, similar to the pandemic economic response program, to “protect workers and businesses who lost their livelihoods because of the decisions of others.” That kind of financial aid was left out in the legislation, and the White House is seen as unlikely to pursue a Paycheck Protection Program-like initiative. The bill is sponsored by Vance, Brown and Sens. Robert P. Casey Jr. (D-Pa.), John Fetterman (D-Pa.), Marco Rubio (R-Fla.) and Josh Hawley (R-Mo.)

“Without special refinancing, homeowners will be underwater as flight from the community drives home prices lower, decimating the tax base on which local schools and public services rely,” Vance wrote in The Post. “Farms will require direct support. Underfunded schools will need help.”

Some White House allies are urging swift action.

“It would certainly be reasonable for them to do it. Obviously, people have been hit hard there,” said Dean Baker, a White House ally and economist at the Center for Economic and Policy Research, a Washington-based think tank. Baker pointed out that lawsuits against Norfolk Southern could take a long time to be adjudicated. “These lawsuits can take forever, but the people there should not have to wait.”

Liz Goodwin contributed to this report.

The Ohio train derailment and chemical spill

The latest: Ohio is suing Norfolk Southern after a train derailed in East Palestine. In February, the National Transportation Safety Board released a preliminary report on the train derailment.

What are the health risks of the chemical spill? One toxic gas, vinyl chloride, was burned after the derailment, sending various toxins and chemicals into the air. The EPA is handling the disaster response.

The politics: Amid a partisan divide over the disaster response, former president Donald Trump and Transportation Secretary Pete Buttigieg visited the derailment site.

Who is impacted? The Biden administration is taking heat for not doing enough to help, while Ohio residents are angry after Norfolk Southern backed out of a town hall addressing the response. The derailment also killed more than 43,000 aquatic animals in the area. Here’s what to know about the derailment’s toxic plume.