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The Koch Network Is Killing Rail Safety

Above photo: A Koch Industries sign and the Norfolk Southern freight train that derailed in East Palestine, Ohio, in 2023. AP Photo/Charles Krupa/Gene J. Puskar.

The billionaire-backed Koch network is leading efforts to stonewall the bipartisan Railway Safety Act.

One year after a toxic train derailment in East Palestine, Ohio, inspired bipartisan legislation that would have made the nation’s railways safer for everyone, the bill has been all but killed — largely thanks to a familiar conservative foe: the Koch network.

Koch Industries, the parent company of various petrochemical subsidiaries run for decades by Charles Koch and his now-deceased brother David, spent nearly $8 million in the past year lobbying on the legislation and other issues, as well as donated $1.4 million to Republican lawmakers who helped stall the legislation. The effort was part of nearly $200 million the conglomerate has spent in the past decade to persuade lawmakers and regulators to block railway safety legislation and other measures — including reforms that could have helped avoid the East Palestine disaster.

These amounts don’t include millions more spent by the extended Koch network, a shadowy web of libertarian think tanks, foundations, and advocacy groups founded by the Koch brothers to stop government efforts to boost health care, combat climate change, and improve the common good.

In comparison, the railway interests that would have to bear the direct costs of safety reforms spent $4.4 million lobbying on the legislation and other matters, and $110,000 on related political donations in 2023.

The Koch network’s opposition to rail safety isn’t just an outgrowth of its anti-government ideology. Part of the cost of new regulations would likely be passed on to Koch Industries and other hazardous material producers in the form of higher rail freight costs for chemicals and other manufacturing materials used for products like kitchenware, clothing, airbags, and petroleum-based products. The costs to clean up hazardous derailments, on the other hand, fall on the railroad companies — which leaves less incentives for Koch Industries and other chemical producers to advocate for regulations that could reduce accidents.

On March 1, 2023, less than a month after a Norfolk Southern freight train derailed in East Palestine, releasing more than a million pounds of toxic chemicals into the environment, Sens. Sherrod Brown (D-Ohio) and J.D. Vance (R-Ohio) introduced the Railway Safety Act in the Senate. The bill, cosponsored by a group of bipartisan Senators, aimed to require at least two operators on trains hauling toxic chemicals, increased inspections, heavier fines for rulebreakers, and a phaseout of 1960s-era tank cars that haul hazardous materials.

The bill offers the first major safety reforms for the rail industry since 2008, when Congress passed legislation requiring updated technology that helps prevent train collisions and automatically reduces train speed to prevent derailments.

But the Koch network and its web of conservative operatives launched an all-out assault to stop the new rail safety bill. Along with spending millions in lobbying and donations, the groups have mounted a PR blitz.

In July, the Koch-backed Competitive Enterprise Institute, a conservative think tank, sent a letter to federal lawmakers urging them to oppose the Senate version of bill, saying in part that the legislation “includes far too many prescriptive policies, unduly favors organized labor, and would unduly empower unelected bureaucrats.”

At least five other Koch-backed groups, including Americans for Prosperity, the Rio Grande Foundation, 60 Plus Association, the American Consumer Institute, and Americans for Limited Government also signed onto the Competitive Enterprise Institute letter. Last year alone, Koch Industries donated $25 million to Americans for Prosperity, a libertarian group founded by Charles and David Koch.

Then, on the one-year anniversary of the East Palestine derailment, the Competitive Enterprise Institute declared in an opinion piece for The Hill that to honor the accident, Congress should not pass rail safety legislation and should instead let the industry regulate itself.

“Instead of trying to prevent the last accident, a better way to approach the problem would be to set safety targets and allow railroads to develop the best ways to meet them,” wrote Iain Murray, a senior fellow at the Institute.

Such demands have been met as key legislators who have raked in tens of thousands of dollars in campaign donations from Koch Industries and other groups have watered down the legislation — including removing the tank car upgrade provision — and blocked all movement on the bill.

A House version of the Railway Safety Act was introduced soon after the Senate version and both efforts have bipartisan and public support — which makes the bills’ lack of progress even more frustrating, said Rep. Chris Deluzio (D-Penn.), co-author of the House bill and whose district borders East Palestine.

“We can’t get this thing on the floor or even moving through committee,” DeLuzio told The Lever. “I think the problem here is Republican House leadership won’t move the bill, and I suspect that’s because of the strong lobbying by the rail industry and others against it.”

Koch Industries did not respond to a request for comment.

The Deregulation Squad

Koch Industries is the massive parent company for various subsidiaries that sell everything from beef and medical technology to asphalt and fertilizers to petrochemicals and oil. Koch Industries’ products are crucial in making many common consumer items — including Brawnie and Dixie kitchen products, smart phones, electric cars, and various chemicals found in common fertilizers.

A key ingredient in many fertilizers is ammonia, a corrosive chemical that can explode if ignited, and Koch Fertilizer claims to produce 10 million metric tons — roughly 2.6 billion gallons — of ammonia annually.

Regulations require large quantities of ammonia and other dangerous chemicals to be transported by rail lines to prevent disasters in high-population areas. This means Koch companies rely on the rail industry to ship their highly toxic products across the country in order for them to be used or refined elsewhere. Those lines often run through rural or economically depressed areas.

To keep rail freight costs down, Koch Industries has been fighting railway safety legislation for more than a decade. The corporation and others have repeatedly asked regulators to conduct further studies on how new regulations may affect the industry and pleaded for delayed timelines, a Lever review of comments submitted to regulators has revealed.

The conglomerate often works hand in hand with rail interests and other industry groups. That includes the Association of American Railroads, a major lobbying group representing the largest rail companies, which has given safety awards to Koch companies and has Koch Industries representatives sit on internal committees. It also includes the Fertilizer Institute, a lobbying group representing the fertilizer industry that counts Koch Industries as a member,

In particular, Koch Industries and related interests have opposed regulations to strengthen rules governing tank cars — rail cars used to ship flammable liquids, compressed gasses, and other hazardous materials.

In 2006, the Federal Railroad Administration proposed a rule that would have forced railroads to get rid of flimsy 1960s-era tank cars and use thicker, modern versions to avoid leaks and spills. In a comment to federal regulators, the Koch Nitrogen Company claimed the rule change would have a “significant” economic impact on the company and that using the new tank cars for ammonia would result in a “single-purpose piece of equipment” and disrupt the market.

The rule stalled, but after a series of fiery incidents in 2013 — including one in Canada that left 47 people dead — federal regulators proposed a new rule requiring railroad companies to upgrade their tank cars used in shipping hazardous materials. The following year, regulators promulgated a similar rule proposal that singled out tank cars hauling hazardous and flammable contents and required all out-of-compliance tank cars to be phased out by October 2020.

During that time, Koch Industries spent more than $24.5 million lobbying on tank car safety issues and other concerns, 2014 and 2015 lobbying disclosures show. The Association of American Railroads spent another $13 million lobbying on tank cars and other issues facing the rail industry during the same period.

The Association of American Railroads and the American Shortline Railroad Association, which represents smaller, regional railroad companies, ostensibly supported the 2013 rule for upgraded tank cars, but urged regulators to slow the timeline after considering the manufacturing and retrofitting work needed to comply with the rule change.

The Fertilizer Institute concurred, telling regulators that they should “conduct a thorough risk-benefit analysis to ensure that the risks of certain products warrant design changes specified.”

And regarding the 2014 rule proposal, the Fertilizer Institute told regulators that they were  concerned that the proposed definition of a “high-hazard flammable train” would extend to tank cars not carrying potentially dangerous chemicals and “have severe negative consequences for all other traffic that depends upon a fluid national rail network.”

The tank car rules were finalized in 2015 and required that railroads fully implement the new tank cars carrying dangerous chemicals by May 2025. However, Congressional Republicans slipped a provision into a 2015 funding bill extending the deadline to 2029 — and former President Barack Obama signed the bill into law.

The tank car issue continued to be an area of concern for industry stakeholders. Koch Industries spent nearly $54 million lobbying on tank cars and other issues between 2014 to 2019. The Association of American Railroads spent nearly $27 million lobbying on tank cars and other issues during the same time period.

The rail industry also lobbied to obscure the definition of high-hazard flammable trains and were able to exempt vinyl chloride, the volatile and carcinogenic chemical released in East Palestine. Because of this lobbying, the East Palestine train was not regulated as a high-hazard flammable train even though during a controlled release, its contents exploded and sent 100-foot flames into the sky.

“Unimaginable Authority”

Most recently, Koch Industries spent nearly $8 million lobbying on the Railway Safety Act and other issues in 2023, and its anti-regulation efforts extend beyond official company lobbying.

The Association of American Railroads spent $4.4 million lobbying Congress and regulators on the Railway Safety Act and other issues in 2023. The group supports the Railway Safety Act in some aspects, but opposes key provisions that would increase the number of workers on trains and enhance other safety measures.

“Challenges remain with certain provisions, including those that mandate crew staffing models, expand hazmat transportation operating requirements, micromanage detector networks, and unnecessarily broaden manual inspections,” the Association of American Railroads wrote in a press release. “If stakeholders’ goal is to drive continuous improvement in rail safety, the industry must be able to continue innovating just as it did decades ago to develop today’s wayside detectors.”

The Fertilizer Institute spent $1.7 million lobbying on rail safety legislation and other issues in 2023.

The wider Koch network has also pushed back on recent attempts to regulate the rail industry. Just a month after the East Palestine disaster, FreedomWorks — a conservative advocacy group founded by Charles and David Koch — urged lawmakers to oppose the Railway Safety Act, saying the bill would give the Transportation Department “unimaginable authority.”

“Introduced following the horrible accident in East Palestine, Ohio, the legislation offers a slew of significant new regulations that would do little to improve safety while creating gross inefficiencies for thousands of businesses,” FreedomWorks wrote in a letter to Congress. FreedomWorks spent $30,000 in 2023 lobbying on the Railway Safety Act and other issues.

Koch-Backed Politicians

Koch Industries’ efforts to block railway safety legislation also include direct campaign donations to Congressmembers sitting on key committees overseeing railway legislation and funding challengers against pro-railway safety politicians.

The top five Republicans on the House subcommittee overseeing railway regulations — Reps. Troy Nehls (Texas), Brian Babin (Texas), David Rouzer (N.C.), Mike Bost (Ill.), and Doug LaMalfa (Calif.) — have received more than $85,000 in total campaign donations from Koch Industries, the Association of American Railroads, the American Shortline Railroad Association, and the Fertilizer Institute in the past three election cycles.

Similarly, the top five Republicans on the Senate committee overseeing the rail industry — Sens. Ted Cruz (Texas), John Thune (S.D.), Roger Wicker (Miss.), Deb Fischer (Neb.), and Jerry Moran (Kan.) — have received more than $66,000 in campaign donations from these same industry groups since 2020.

The House subcommittee has blocked any discussion on the Railway Safety Act, and the Senate committee, chaired by Sen. Maria Cantwell (D-Wash.), weakened the bill by delaying a deadline for stronger tank cars.

Republican leadership has also received tens of thousands of dollars in campaign donations from these groups. Senate Minority Leader Mitch McConnell (Ky.) has received $39,000 from Koch Industries, the Fertilizer Institute, and the American Railroad Association since 2020. House Speaker Mike Johnson (La.), who can bring bills to a vote in the House of Representatives, has received $39,000 from Koch Industries during that same time frame.

Koch Industries also gave $500,000 to the Senate Leadership Fund, which is used to elect Republican Senators, and gave $750,000 to the Congressional Leadership Fund, which is used to elect Republicans in the House.

Deluzio recently urged Johnson to bring the Railway Safety Act he co-authored to a floor vote and support its passage. His pleas have so far gone unanswered — and now he’s being targeted by the Koch network.

In his 2024 efforts for re-election, Deluzio is facing a potential Koch-backed challenger who is running in the GOP primary — and Democratic leadership has labeled his seat as “vulnerable.”

“One of the first endorsements against me was Americans for Prosperity, who’s literally lobbying against the Railway Safety Act,” said Deluzio.“I think it sends a pretty strong signal to our constituents, that there are folks in Washington willing to carry water for big corporations at the expense of all of us.”

“Too Little, Too Late”

The Railway Safety Act would be a good first step if it ever comes up for a vote, but some advocates say more extensive reforms are needed.

“[The bill is] really not enough,” said Matt Weaver, an organizer with Railroad Workers United,. “It’s been muddied up by lobbyists.”

Weaver believes legislation should mandate two-man crews, better signals at railroad crossings for maintenance workers working on the tracks, and wheel-bearing sensors that alert onboard operators of high temperatures and could have helped mitigate the East Palestine disaster

On February 16, President Joe Biden made his first-ever trip to East Palestine, where he called the derailment “an act of greed that was 100 percent preventable” and urged the passage of the Railway Safety Act.

But Weaver says amid ongoing market consolidation in the rail industry and “precision scheduled railroading” cost-cutting efforts that have led to longer trains and smaller crews, a photo op and inspiring speech isn’t going to be enough to improve rail safety. There have already been three railroad worker deaths this year that Weaver believes could have been prevented with stricter regulations.

“Seeing Biden go to East Palestine was a good thing, but boy it’s too little, too late,” Weaver said. “He demanded Congress pass the [Railway Safety Act], but there is so much other stuff going on. The industry has so much power and they have great monetary influence on politicians.”

Editor’s note: This story has been updated to clarify that Koch Industries lobbied on the Rail Safety Act and other issues in 2023.

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