East Palestine train wreck, one year later

Norfolk Southern has spent the year since then working to clean up the area and make amends in East Palestine and communities on both sides of the Ohio-Pennsylvania border.

Here’s a rundown of what’s been done so far:

Derailment site cleanup

Norfolk Southern completed soil remediation at the site of the train wreck last fall.

Now, the areas where contaminated soil was removed are being backfilled. The stone and gravel is being trucked for the backfill work, which is expected to continue through the winter, according to the U.S. Environmental Protection Agency.

The environmental remediation at the site was extensive. An estimated 176,787 tons of solid waste and 44.4 million gallons of wastewater were hauled out. Waste went to EPA-approved sites including in Ohio, Texas, Michigan and Indiana, with some liquid wastewater disposed of through deep-well injection. Solid waste was incinerated or placed in landfills specifically designed to minimize the chance of releasing hazardous waste into the environment.

Cleaning streams

Yet to be completed is a full cleanup of tributaries in East Palestine, which have had a visible sheen when oil-contaminated sediment is disturbed.

The derailment involved rail cars carrying pollutants, oil and hazardous substances, and some cars spilled their loads into a ditch that feeds a stream in East Palestine called Sulphur Run, which joins Leslie Run.

Norfolk Southern has collected samples of sediment in the creeks, and has proposed an approach for additional cleanup that must be approved by officials before cleanup of the streams is completed in the coming months.

Community contributions

Norfolk Southern said it has committed more than $100 million to East Palestine and surrounding areas in Ohio and Pennsylvania. That includes:

In total, Norfolk Southern has accumulated $1.1 billion in charges from the derailment, including for the cleanup, legal expenses, payments to residents who relocated and donations to the community.

Norfolk Southern to end reimbursements for temporarily relocated residents

On Feb. 9, Norfolk Southern will end its temporary relocation assistance payments to residents.

The railroad has been paying for hotel rooms and living expenses for East Palestine residents who relocated after the derailment.

The town has a population of about 4,700, and Norfolk Southern said fewer than 40 families were still using the assistance.

That company said it would discontinue the funding since it had finished the work of excavating and removing contaminated soil from the derailment site in October.

Norfolk Southern has also been offering compensation to homeowners for lost value in their homes.

Efforts to improve rail safety

After the derailment, federal legislators proposed a Railway Safety Act to improve safety as trains ply the country. But the bill has stalled in Congress. The railroad industry, represented by lobbying group the Association of American Railroads, has said it supports “enhancing rail safety,” but voiced opposition to some proposed reforms for crew staffing and hazmat transportation, and for new inspection requirements and defect detectors along the rails.

The industry says railroads have undertaken their own measures such as adding more defect detectors and improving standards for inspections.

Norfolk Southern said it has added more defect detectors along the rails, is doing more testing and has changed train composition to improve safety.

“And we are striving to become even safer,” said Norfolk Southern Chief Operating Officer Paul Duncan during an investor conference call on Friday.

“I wouldn’t say that the incremental direct safety costs that come out of (East Palestine) are consequential. And frankly, I think ultimately, they’re going to yield to better results in the go-forward. Because we are running a safer railroad,” with fewer derailments, said Norfolk southern Chief Financial Officer Mark George. “There’s probably some, for sure some lingering incremental costs because we’re doing things different, but there will be a benefit longer term.”

Strain on company leads to plan to cut jobs

The Atlanta-based railroad said Friday its 2023 net income was down 44% compared to 2022 primarily because of the derailment.

It also disclosed Friday plans to cut management staff to reduce costs. The company aims to cut more than 300 people in the next several months.

Revenue was down 5% in 2023 amid network disruptions — including technology outages — and a “stubbornly weak freight market.”

Norfolk Southern reported $1.8 billion in net income for last year, down from $3.3 billion in 2022.

The company’s fourth quarter results included another $150 million in charges associated with the East Palestine derailment, after collecting $76 million in insurance payments. Fourth quarter net income was $527 million, down 33% from $790 million a year ago.

Railway operating revenues for the quarter ended Dec. 31 dipped 5% from a year ago to $3.1 billion. Quarterly railway operating expenses, meanwhile, were $2.3 billion, up 10% from a year earlier.