Norfolk Southern to pay over $500M for cleanup, rail safety after East Palestine derailment
Norfolk Southern will pay just over $500 million — $310 in environmental cleanup and $200 million for rail safety upgrades — as a result of last year’s disastrous train derailment in East Palestine, Ohio, the Biden administration announced on Thursday.The proposed settlement, reached among Norfolk Southern, the EPA and the Justice Department, is "unprecedented," acting Associate Attorney General Benjamin Mizer, an Ohio native, told reporters on Thursday. Beyond health and environmental cleanup, the settlement also mandates rail safety upgrades that EPA Administrator Michael Regan called “a game-changer" — something he said might even have prevented the accident "had these provisions been in place on February 3, 2023."“This resolution cannot undo the damage that was done last February, but we hope that this settlement will be an important step forward in protecting the community, helping it heal and preventing a tragedy like this from happening again,” Mizer said.In a statement, Norfolk Southern CEO Alan Shaw said the company is "pleased we were able to reach a timely resolution of these investigations that recognizes our comprehensive response to the community’s needs and our mission to be the gold standard of safety in the rail industry."In a statement, Transportation Secretary Pete Buttigieg said the Biden “administration has taken historic action to hold Norfolk Southern accountable for the derailment in East Palestine, Ohio. Our department was proud to work alongside with DOJ and EPA to ensure this settlement enhanced rail safety.”The details: As part of the settlement, the railroad does not admit liability. The settlement includes $235 million in cleanup cost reimbursements that Regan said will fully cover federal expenditures on the disaster response, as well as: — $25 million for a two-decade community health program.— a $15 million civil penalty under the Clean Water Act, which Regan said is the largest allowed under the law.— $15 million for a 10-year monitoring program for surface and groundwater.— $15 million for private drinking water monitoring.— $6 million for a waterways remediation plan to address pre-existing pollution and water quality issues; and— $175,000 in natural resource damages.In addition, the settlement mandates that Norfolk Southern improve safety standards for transporting hazardous materials, including installing more hot bearing detectors, which can sense when wheels are overheating early enough to prevent what happened in East Palestine. In the disaster, hot bearing detectors alerted as wheels heated up, but by the time those detectors read hot enough to stop the train, it was already derailing.“Considering its large market share, we expect that these required provisions will advance safer practices across the railroad industry for many years to come,” Regan said. “Today's agreement clearly demonstrates that these safety practices are both reasonable and achievable by the broader industry.”Norfolk Southern's big bill: In addition to the $500 million settlement, Norfolk Southern has already incurred environmental response costs of its own totaling $780 million. That includes hundreds of thousands of tons of soil and millions of gallons of water contaminated by chemicals carried by the train — including vinyl chloride that was released from tankers to prevent an explosion — the railroad has already excavated and shipped to decontamination facilities.The troubled rail company estimates it will spend in total over $1 billion responding to the contamination and other harms caused by the accident that resulted in first responders and railroad officials deciding to burn noxious chemicals shortly after the derailment, the effects from which residents say they are still feeling more than a year later. Residents and those within miles of the town have reported respiratory issues and headaches following the incident, among other health concerns.What's next: The settlement will be open for 30 days of public comment and must be approved by a judge.There are other settlements in the works, including a $600 million one between Norfolk Southern and people affected by the derailment that was granted preliminary approval. The deadline for those aggrieved to file a claim is August 22.A cadre of senators, spearheaded by J.D. Vance (R-Ohio) and Sherrod Brown (D-Ohio), are also continuing to press for legislative changes to rail safety, but a bipartisan bill responding to the incident, S. 576 (118), has languished in the Senate. That bill would bolster inspections, require particular detection equipment, add safety standards for hazardous materials and increase crew staffing requirements on trains, among other actions. Vance told POLITICO earlier this week that he is still pushing for a Senate floor vote on the bill.A National Transportation Safety Board report on the incident is expected in the coming weeks.
The settlement also mandates rail safety upgrades.
Norfolk Southern will pay just over $500 million — $310 in environmental cleanup and $200 million for rail safety upgrades — as a result of last year’s disastrous train derailment in East Palestine, Ohio, the Biden administration announced on Thursday.
The proposed settlement, reached among Norfolk Southern, the EPA and the Justice Department, is "unprecedented," acting Associate Attorney General Benjamin Mizer, an Ohio native, told reporters on Thursday.
Beyond health and environmental cleanup, the settlement also mandates rail safety upgrades that EPA Administrator Michael Regan called “a game-changer" — something he said might even have prevented the accident "had these provisions been in place on February 3, 2023."
“This resolution cannot undo the damage that was done last February, but we hope that this settlement will be an important step forward in protecting the community, helping it heal and preventing a tragedy like this from happening again,” Mizer said.
In a statement, Norfolk Southern CEO Alan Shaw said the company is "pleased we were able to reach a timely resolution of these investigations that recognizes our comprehensive response to the community’s needs and our mission to be the gold standard of safety in the rail industry."
In a statement, Transportation Secretary Pete Buttigieg said the Biden “administration has taken historic action to hold Norfolk Southern accountable for the derailment in East Palestine, Ohio. Our department was proud to work alongside with DOJ and EPA to ensure this settlement enhanced rail safety.”
The details: As part of the settlement, the railroad does not admit liability. The settlement includes $235 million in cleanup cost reimbursements that Regan said will fully cover federal expenditures on the disaster response, as well as:
— $25 million for a two-decade community health program.
— a $15 million civil penalty under the Clean Water Act, which Regan said is the largest allowed under the law.
— $15 million for a 10-year monitoring program for surface and groundwater.
— $15 million for private drinking water monitoring.
— $6 million for a waterways remediation plan to address pre-existing pollution and water quality issues; and
— $175,000 in natural resource damages.
In addition, the settlement mandates that Norfolk Southern improve safety standards for transporting hazardous materials, including installing more hot bearing detectors, which can sense when wheels are overheating early enough to prevent what happened in East Palestine. In the disaster, hot bearing detectors alerted as wheels heated up, but by the time those detectors read hot enough to stop the train, it was already derailing.
“Considering its large market share, we expect that these required provisions will advance safer practices across the railroad industry for many years to come,” Regan said. “Today's agreement clearly demonstrates that these safety practices are both reasonable and achievable by the broader industry.”
Norfolk Southern's big bill: In addition to the $500 million settlement, Norfolk Southern has already incurred environmental response costs of its own totaling $780 million. That includes hundreds of thousands of tons of soil and millions of gallons of water contaminated by chemicals carried by the train — including vinyl chloride that was released from tankers to prevent an explosion — the railroad has already excavated and shipped to decontamination facilities.
The troubled rail company estimates it will spend in total over $1 billion responding to the contamination and other harms caused by the accident that resulted in first responders and railroad officials deciding to burn noxious chemicals shortly after the derailment, the effects from which residents say they are still feeling more than a year later. Residents and those within miles of the town have reported respiratory issues and headaches following the incident, among other health concerns.
What's next: The settlement will be open for 30 days of public comment and must be approved by a judge.
There are other settlements in the works, including a $600 million one between Norfolk Southern and people affected by the derailment that was granted preliminary approval. The deadline for those aggrieved to file a claim is August 22.
A cadre of senators, spearheaded by J.D. Vance (R-Ohio) and Sherrod Brown (D-Ohio), are also continuing to press for legislative changes to rail safety, but a bipartisan bill responding to the incident, S. 576 (118), has languished in the Senate.
That bill would bolster inspections, require particular detection equipment, add safety standards for hazardous materials and increase crew staffing requirements on trains, among other actions. Vance told POLITICO earlier this week that he is still pushing for a Senate floor vote on the bill.
A National Transportation Safety Board report on the incident is expected in the coming weeks.