SALEM, Ohio — The U.S. Environmental Protection Agency and the U.S. Department of Justice announced a more than $310 million settlement with Norfolk Southern on May 23 to pay for damage caused by a fiery train derailment in East Palestine, Ohio that spilled harmful chemicals into nearby streams
If the settlement is approved by the U.S. District Court for the Northern District of Ohio, Norfolk Southern will have to pay a fine, invest in long-term health monitoring and mental health services for surrounding communities and implement measures to protect local waterways and drinking water sources, among other things.
The settlement announcement came two days after an Ohio federal judge signed off on a $600 million settlement to be paid by Norfolk Southern to residents and businesses in East Palestine and surrounding communities.
“No community should have to experience the trauma inflicted upon the residents of East Palestine,” EPA Administrator Michael S. Regan said, in a statement “Because of this settlement, residents and first responders will have greater access to health services, trains will be safer and waterways will be cleaner.”
Settlement details
The DOJ settlement requires Norfolk Southern to pay $235 million for all past and future clean-up costs, to prevent the use of taxpayer dollars for the clean-up, and $25 million for a 20-year community health program that will entail medical monitoring and mental health services for residents of affected counties and first responders who were impacted by the Feb. 3, 2023 train derailment.
About 50 Norfolk Southern train cars derailed, 11 of which contained hazardous materials, just a few hundred feet from the Pennsylvania state line. Residents within a mile of the derailment site were ordered to evacuate.
Some of the derailed train cars ruptured, releasing chemicals and lube oil into nearby Sulphur Run Creek, which runs through the heart of East Palestine and connects with Leslie Run Creek. Both creeks are still impaired by the derailment spills, according to the EPA.
Norfolk Southern will also pay $15 million for alleged violations of the Clean Water Act, $15 million for long-term monitoring of ground and surface water for 10 years, $15 million that will finance the existing private drinking water well monitoring program for 10 years, $175,000 for natural resource damages and an estimated $6 million for a water remediation plan for projects in Sulphur Run and Leslie Creek.
Norfolk Southern’s water remediation plan for the creeks will address the historical pollution, reduce non-point source pollution through infrastructure upgrades and stormwater management and re-establish aquatic and riparian habitat.
Safety upgrades.
The company will also adopt projects to improve the transportation of hazardous materials via railway, as part of the settlement.
This will include the installment of 200 more trackside detectors to spot overheating wheel bearings and investments in more than a dozen advanced inspection portals that use cameras to take hundreds of pictures of every passing railcar for detecting safety defects.
“Importantly, those who will most directly benefit from this settlement are those who were most directly affected by the disaster. And the rail safety commitments will help prevent future catastrophic railway events,” Acting Associate Attorney General Benjamin C. Mizer said in a statement about the settlement.
Norfolk Southern will also reimburse the EPA $57 million for response costs made through Nov. 30, 2023, and onward.
Where did the $310 settlement begin?
The $310 million settlement is the result of a complaint filed in March 2023 by the United States against Norfolk Southern for the unlawful release of pollutants and hazardous substances during the train derailment.
In total, Norfolk Southern estimates it will spend more than $1.7 billion on cleanup efforts in East Palestine and rail safety improvements, which includes the $310 million settlement and $780 million in environmental response costs previously made by the company. Norfolk Southern also predicts costs for rail safety improvements will cost $244 million through 2025.
There will be a 30-day public comment period for the proposed DOJ settlement before it goes for final approval
Additionally, the National Transportation Safety Board will announce its final investigation findings on the cause of the derailment at a public hearing on June 25 at 9:30 p.m. at East Palestine High School.
U.S. Sen. JD Vance, R-Ohio, and Ohio Attorney General Dave Yost expressed disappointment over the DOJ’s settlement before the NTSB public hearing.
“This federal settlement, reached prior to the completion of the NTSB’s investigation, risks undercompensating the residents of East Palestine,” Vance and Yost said, in a joint statement. “The Department of Justice would have better served East Palestine and surrounding communities by negotiating against Norfolk Southern armed with all relevant facts surrounding the disaster — facts which can only be revealed by the NTSB.”
Another settlement two days before
The $600 million lawsuit approved by an Ohio federal judge on May 21 resolved class action claims made by businesses located within 20 miles of the derailment that allege damage and financial loss. It will also reimburse residents who live within 10 miles of the derailment and filed personal injury lawsuits for health impacts.
Despite the settlement, residents are concerned the money won’t be enough once it’s divided up. Lawyers could receive up to $162 million in legal fees out of the settlement if the judge approves.
The amount residents receive will be determined by how close they live to the derailment site and how much the derailment impacted them. The closer one lives, the more money they will most likely get.
The amount residents receive will also be dependent on how much assistance they have received from Norfolk Southern, which includes relocation aid. This amount will be deducted from the settlement residents get, which will be reinvested back into the settlement fund to be used for the community. Residents have until July 1 to opt out of the deal and file an individual lawsuit.
(Liz Partsch can be reached at epartsch@farmanddairy.com or 330-337-3419.)
