March 17, 2016 / 12:19 PM / 2 years ago

Obama administration offers $66 million to aid coal communities

WASHINGTON (Reuters) - The Obama administration released $65.8 million on Thursday to help communities that are struggling from the decline of the coal industry and bankruptcies of major producers of the fuel.

The funds announced by the federal Appalachian Regional Commission and the Economic Development Administration will support projects that help coal-dependent communities in places like West Virginia and Kentucky diversify their economies, retrain the workforce and attract new investment.

The funds are coming through the Obama administration’s Partnerships for Opportunity and Workforce and Economic Revitalization Initiative, which helps coal-reliant regions cope with market forces, air pollution regulations and other factors.

“Many communities across Appalachia – from coal mines to Main Streets – are being impacted as the world changes the way it produces and consumes electricity,” said ARC Chairman Earl Gohl.

The grant comes the day after Peabody Energy Corp, the largest U.S. coal producer, said it might have to seek bankruptcy protection.

Peabody would become the latest in a line of major coal miners, including Arch Coal Inc, to file for bankruptcy as demand for coal plummets both domestically and in global markets like China and amid competition from natural gas.

The plight of coal communities, particularly in the Appalachian region of the eastern United States, has gained importance in the 2016 presidential campaign, where economic frustration of white working-class voters has become a major theme.

Last week, Democratic front-runner Hillary Clinton triggered critical comments from Republican lawmakers in Kentucky when she told a CNN town hall meeting: “We’re going to put a lot of coal miners and coal companies out of business” when explaining her $30 billion economic transition plan for coal-dependent regions.

Her plan expands on Obama’s broader POWER+ Plan, a set of investments in coal-dependent communities outlined in his 2017 budget.

Senate Majority Leader Mitch McConnell of Kentucky, a Republican, called Clinton’s comments callous and said “it underlines the need to stand up for hard-working, middle-class coal families.”

Clinton campaign spokesman Brian Fallon said McConnell and other critics “twisted Clinton’s words to suggest she showed a disregard for coal workers and their livelihoods.”

Meanwhile, New York real estate mogul Donald Trump, the Republican front-runner, said at a recent campaign stop in Ohio: ”We have to protect your coal industry which is being decimated” by the Obama administration’s environmental regulations.

Additional reporting by Amanda Becker

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