Norfolk Southern to Pay $15M Fine for East Palestine Derailment

The railroad also promised to pay more than $500 million to complete safety improvement efforts.

Kristen Kazarian, Managing Editor

May 24, 2024

3 Min Read
Norfolk Southern to pay $15M and other fines for East Palestine derailment
Residents who had to evacuate their homes after the derailment were generally underwhelmed by the deal.Thomas Winz/The Image Bank via Getty Images

The US Justice Department and Environmental Protection Agency agreed to a $15 million fine for Norfolk Southern over last year’s train derailment in East Palestine, OH, and the railroad promised to pay more than $500 million to complete the efforts to improve safety that it announced after the crash and address community health concerns.

Residents who had to evacuate their homes after the derailment were generally underwhelmed by the deal the Environmental Protection Agency and Justice Department announced Thursday that doesn’t include any criminal charges. This federal settlement comes two days after a federal judge signed off on the railroad’s $600 million class action settlement with residents whose lives were disrupted.

In addition to the civil penalty, Norfolk Southern agreed to pay $235 million in past and future cleanup costs — on top of what they’ve already paid for cleanup — and set up a $25 million health care fund to pay for 20 years of medical exams in the community. The railroad will also pay about $30 million for long-term monitoring of drinking water, groundwater and surface water in the area. The agreement also says the railroad will pay $244 million for previously promised railroad improvements through 2025.

EPA Administrator Michael Regan said the fine is the largest allowed under the Clean Water Act, and the railroad agreed to continue paying all of the cleanup costs. Plus he said Norfolk Southern committed to meaningful safety improvements.

“This settlement is historic in many ways and will begin to make up for some of the damage caused to the residents of East Palestine. And it would absolutely push the industry in the direction that we would like for the industry to go,” Regan said. “Again, if some of these provisions that we’ve secured and locked in had been in place, we may not even be where we are today. ”

But the railroad won’t face criminal charges, and this latest settlement won’t add anything to Norfolk Southern’s roughly $1.7 billion in total costs related to the derailment because the Atlanta-based company was already anticipating those costs.

The safety improvements Norfolk Southern promised include adding about 200 more trackside detectors to spot overheating bearings. It has also promised to invest in more than a dozen advanced inspection portals that use an array of cameras to take hundreds of pictures of every passing railcar.

A bill in Congress that would require Norfolk Southern and the rest of the major freight railroads to make more significant changes has stalled, although the industry has promised to make improvements on its own.

Norfolk Southern officials said they believe the relatively small size of this settlement reflects how much the railroad has already done, including paying $780 million in cleanup costs and providing $107 million in aid to residents and the communities affected.

The only remaining federal investigation is the National Transportation Safety Board’s probe into the cause of the Feb. 3, 2023, derailment. That agency plans to announce its conclusions at a hearing in East Palestine on June 25, 2024. 

The NTSB has said previously that the derailment was likely caused by an overheating bearing that wasn’t caught in time by the trackside detectors the railroad relies on to spot mechanical problems. The head of the NTSB also said that the five tank cars filled with vinyl chloride didn’t need to be blown open to prevent an explosion because they were actually starting to cool off even though the fire continued to burn around them.

The railroad is still working to resolve a lawsuit Ohio filed against it after the derailment.

About the Author(s)

Kristen Kazarian

Managing Editor

Kristen Kazarian has been a writer and editor for more than three decades. She has worked at several consumer magazines and B2B publications in the fields of food and beverage, packaging, processing, women's interest, local news, health and nutrition, fashion and beauty, automotive, and computers.

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