EAST PALESTINE, Ohio — Norfolk Southern and the village of East Palestine have reached a $22 million settlement addressing all claims related to the February 3, 2023, train derailment and hazardous materials release.
The settlement, announced Monday through a joint statement on the East Palestine website, acknowledges the approximately $13.5 million that Norfolk Southern (NS) has already invested in the village. These funds have been directed toward replacing fire and police vehicles, upgrading the local water treatment plant, and renovating the exterior of the East Palestine railroad station. The agreement also includes a commitment from NS to spend an additional $25 million to improve East Palestine City Park.
The derailment, caused by a defective wheel bearing, involved 38 freight cars, with 12 more affected by a subsequent fire. Eleven of the derailed cars contained hazardous materials, including vinyl chloride, which led to a controlled burn by Norfolk Southern to prevent a potential explosion. This decision, later determined by the National Transportation Safety Board to be unnecessary, resulted in the spread of toxic fumes throughout the area. The incident sparked nationwide concern over rail safety.
The derailment, which resulted in over $1.6 billion in expenses for Norfolk Southern by the end of 2024, also prompted a proxy fight for control of the company’s board. Activist investor Ancora Holdings gained seats on the board and reached a settlement to increase its influence.
In a notable change, the planned $20 million regional safety training center for first responders in East Palestine will no longer be built. Both Norfolk Southern and the village determined that the facility was not feasible. However, NS will transfer 15 acres of land, initially set aside for the training center, to the village for future use.
The settlement marks another chapter in the ongoing recovery for East Palestine, following the devastating derailment.
