Embattled US freight railroad operator Norfolk Southern (NS) has reached a wide-ranging deal with federal authorities over its disastrous derailment in East Palestine, Ohio, in February 2023.
The company will pay more than $300m alongside a $600m settlement with residents affected by the derailment and subsequent environmental disaster.
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In total NS estimated it would foot a bill worth nearly $2bn.
The latest agreement, just two days after the class action with residents was settled, is said to resolve investigations by three major government agencies: Department of Justice (DOJ), Environmental Protection Agency (EPA), and Department of the Interior (DOI). It is still subject to court approval.
The latest payments include:
- $244m on a Six Point Safety Plan
- $57m to reimburse EPA for its clean-up operations
- $15m civil penalty
- $7m for “several environmental remediation projects”
- $10-15m for ground water monitoring
- $10m for a drinking water monitoring system
- $25m to set up and maintain a Community Health Program
NS said the penalties and reimbursements were in addition to $107m committed to East Palestine residents through its Family Assistance Center.
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By GlobalData“From day one, it was important for Norfolk Southern to make things right for the residents of East Palestine and the surrounding areas,” Alan Shaw, CEO of Norfolk Southern claimed.
Despite 15 months passing since the crash and the fears over long-term health effects from the chemicals released and burned in the derailment, Shaw described the legal settlement as “timely”.
“We are 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. We will continue keeping our promises and are invested in the community’s future for the long-haul.”
In March NS was rebuked for the decision to “blow open” cars carrying vinyl chloride, which the EPA and National Transportation Safety Board said was not needed and caused further problems for the community.
Although the consent decree said “Norfolk Southern has developed, coordinated, and performed one of the most comprehensive incident responses in recent history,” it also noted: “The Derailment and subsequent actions taken by Norfolk Southern because of the Derailment caused the release of hazardous substances under CERCLA, pollutants and hazardous substances under the CWA, and petroleum-based products including oil.
