The Los Angeles Post
California & Local U.S. World Business Lifestyle
Today: February 06, 2025
Today: February 06, 2025

Norfolk Southern to pay $15 million civil penalty, cleanup costs over 2023 Ohio derailment

FILE PHOTO: Norfolk Southern Train rests near the University of North Carolina's energy generation plant, after delivering coal, in Chapel Hill
June 09, 2024

By David Shepardson and Clark Mindock

WASHINGTON (Reuters) - Norfolk Southern agreed to pay a $15 million civil penalty and $57.1 million in past government cleanup costs on Thursday, as well as millions in future costs to resolve a U.S. government lawsuit over a February 2023 train derailment in East Palestine, Ohio.

Under a proposed consent decree estimated to be worth more than $310 million, the railroad also agreed to significant safety improvements and training, which includes installing additional safety equipment after the derailment of the train that caught fire and released over a million gallons of hazardous materials and pollutants.

The Atlanta-based railroad will also pay for medical monitoring for health impacts tied to the derailment and release of hazardous chemicals. The settlement will pay for treatment for individual medical needs stemming from the disaster, the Environmental Protection Agency said.

EPA Administrator Michael Regan said the agreement will hold "Norfolk Southern accountable for the mess it made." He said the civil penalty was the maximum allowable under the Clean Water Act and called the rail safety provision "a game changer."

Norfolk Southern, which did not admit wrongdoing, said the deal means the company will face no criminal penalties and the settlement is included in the around $1.7 billion in related charges to date for the incident. It added the settlement will not require it to take additional charges. The company's shares fell 2% in afternoon trading.

The U.S. Justice Department and EPA sued Norfolk Southern in March 2023 to ensure the railroad paid full cost of cleanup and any long-term effects of the derailment.

Under the settlement, Norfolk Southern will also reimburse EPA for future cleanup and other response costs. EPA estimates Norfolk Southern will spend an estimated $235 million for all past and future cleanup costs under the proposed consent decree subject to public comment and court approval.

The safety improvements include installing additional devices to detect overheated wheel bearings early enough to prevent derailments like the East Palestine incident. Norfolk Southern says under the agreement it will spend $244 million on safety initiatives through 2025.

Norfolk Southern CEO Alan Shaw said the railroad was 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."

The settlement includes $10-$15 million for continuing monitoring of groundwater and surface water bodies and a $25 million Community Health Program providing medical exams and mental health services for the community and first responders for up to 20 years.

The railroad previously has spent $780 million in environmental response and remediation costs and $107 million in assistance to impacted residents and communities in Ohio and Pennsylvania.

Last month, Norfolk Southern agreed to pay $600 million to settle a class action lawsuit over the derailment. The settlement covers personal injury claims from residents and businesses in the city and impacted surrounding communities.

The incident sparked public outrage and calls for railroad safety reforms in Congress but legislation has stalled.

(Reporting by David Shepardson; Editing by Emelia Sithole-Matarise and Aurora Ellis)

Related Articles

OpenAI looks across US for sites to build its Trump-backed Stargate AI data centers Brazil's Galipolo sees surge in crypto use, says 90% of flow tied to stablecoins Column-US risks losing long game in China LNG spat: Bousso

Related

Business|Finance|Political|Stock Markets|US

Top US asset managers face scrutiny from Republican state AGs over China funds

A group of 17 Republican state attorneys general alleged that top U.S. asset managers, including BlackRock and State Street, were making improper or inadequate disclosures about their

Top US asset managers face scrutiny from Republican state AGs over China funds
Business|Food|Technology

Google’s AI-generated Super Bowl cheese ad has some holes

Google’s AI-generated Super Bowl cheese ad has some holes

Google’s AI-generated Super Bowl cheese ad has some holes
Business|Economy|Europe|Finance

Porsche warns of $830 million profit hit in 2025

Porsche AG said on Thursday that expenses for vehicle development and battery activities in its units will impact the company's operating profit and automotive net cash flow by up to 800

Porsche warns of $830 million profit hit in 2025
Business|Economy|Sports

MLB Commissioner Rob Manfred says some fans concerned over lack of salary cap

Baseball Commissioner Rob Manfred says he is getting emails from fans concerned over the sport’s lack of a salary cap following an offseason spending spree by the Los Angeles Dodgers that sparked increased attention over the expiration of the collective bargaining agreement in December 2027

MLB Commissioner Rob Manfred says some fans concerned over lack of salary cap
Share This

Popular

Business|Economy|Stock Markets|Technology|US

Amazon reports strong earnings for Q4, but stocks dip due to guidance for the 1st quarter

Amazon reports strong earnings for Q4, but stocks dip due to guidance for the 1st quarter
Business|MidEast|Political|Sports|US

Trump and Jay Monahan meet at White House as PGA Tour deal with Saudis gets closer

Trump and Jay Monahan meet at White House as PGA Tour deal with Saudis gets closer
Business|Economy|Finance|Political|US

US bond market lukewarm on Bessent's 10-year yield pledge

US bond market lukewarm on Bessent's 10-year yield pledge
Business|Economy|US

US Permian basin's oil output growth to slow in 2025 despite Trump's plan, executives say

US Permian basin's oil output growth to slow in 2025 despite Trump's plan, executives say