NS will 'do what's right' in derailment cleanup, Shaw tells Senate panel

By Julie Sneider, Senior Associate Editor

Norfolk Southern Railway President and CEO Alan Shaw faced extensive grilling from U.S. senators yesterday as he explained his company’s response to the devastating NS train derailment, fire, chemical spill and controlled burn of tank-car contents that occurred in East Palestine, Ohio, during the first week in February.

The hearing was called by the Senate Committee on Environment and Public Works to review why the derailment occurred, what NS and related government agencies are doing to address it and how to prevent such an incident from happening again. The committee heard testimony from Shaw as well as representatives of the U.S. Environmental Protection Agency, the Ohio EPA, Ohio River Valley Water Sanitation Commission and Beaver County Department of Emergency Services.

A number of lawmakers blasted NS for its "negligence" in the derailment. In his prepared testimony and in response to committee members’ comments and questions, Shaw apologized numerous times. He said he and NS are committed to "doing the right thing" by working with federal, state and local agencies to clean up the disaster; reimburse families for financial hardship due to the derailment; and reinvest in East Palestine in its recovery.

According to Shaw, NS financial commitments made so far include reimbursements and investments of more than $21 million, including helping 4,400 families via the Family Assistance Center that NS opened in East Palestine within 24 hours after the derailment; $3 million to assist the East Palestine Fire Department; $1 million to fund the community’s immediate needs, which will be coordinated by an NS railroader who lives in East Palestine; and $7.5 million in financial assistance to reimburse Pennsylvania emergency responders and health and environmental agencies related to the derailment.

Those commitments are a "down payment" to help East Palestine recover and "thrive," said Shaw. Shaw’s written testimony can be read here.

Shaw and EPA Region 5 Administrator Debra Shore told the committee that NS will reimburse the government’s costs of the cleanup.

With their questions, senators tried to draw out more specifics from Shaw about what exactly the company would do to "make it right," but he often didn't answer with deep details. Some senators also asked if Shaw and NS would support the proposed Railway Safety Act, bipartisan legislation introduced last week by Ohio Sens. Sherrod Brown (D) and JD Vance (R), who also testified before yesterday’s panel. Shaw said the company is "committed to the legislative intent" to make railroading safer, but stopped short of endorsing all the specific safety measures called for in the bill.

Shaw and NS were criticized for a lack of transparency and “gaps” in information shared with the community in the early hours and days after the derailment. Eric Brewer, director and chief of hazardous materials response for Beaver County emergency services in Pennsylvania, told the senators that NS' lack of transparency and miscommunication between and among U.S. EPA and Federal Emergency Management Administration (FEMA) regional offices made it harder for local responders and emergency management officials to perform their jobs at the disaster site.

Shaw said that NS is answering residents’ questions at the Family Assistance Center and has launched a website to answer questions about the status of the cleanup and ongoing environmental testing. He also encouraged area residents to contact the company with any questions or concerns.

Some senators asked about the removal of contaminated soil and toxic waste from the derailment site and were critical of the EPA’s order to pause shipping of the material to disposal sites. The shipments were paused temporarily to ensure that the materials were being transported safely and to licensed facilities for toxic waste disposal, according to EPA’s Shore.

Sen. Bernie Sanders (I-Vt.) and a few others questioned Shaw on whether the railroad’s emphasis on cost cutting and employee layoffs to maximize profits for shareholders was partly to blame for the derailment. Sanders blamed Wall Street for pushing the rail industry’s adoption of precision scheduled railroading that led railroads to slash their employment ranks over the past decade. NS cut its workforce by nearly 40% over the past six years, Sanders noted.

"I’ve been told by workers at your and other rail companies that they’re now being asked to do more work with fewer workers, and that includes safety inspections," Sanders said to Shaw. "My question is: Will you lead the industry in doing away with precision scheduled railroading?"

Shaw said the railroad has been "on a hiring spree" — adding 1,500 new employees — since he became CEO in May 2022. And in December 2022, NS began "charting a new course" in which NS will "move away from a near-term focus on profits and take a long-term view based on our craft employees," Shaw said.

Sanders also pressed Shaw on whether he would guarantee that all NS workers would receive at least seven paid sick days a year. NS — along with other Class Is — recently announced voluntary agreements with rail unions that guarantee a certain number of paid sick days. Paid sick leave was a major sticking point in last year’s contentious contract negotiations between the major rail unions and freight railroads, including NS.

Shaw didn’t guarantee a paid number of sick days for all workers, but he did promise to continue discussions with NS employees about the "quality-of-life issues that are important to them."

A number of senators slammed the rail industry for spending millions of dollars on lobbying to fight safety regulations — such as electronically controlled pneumatic braking systems — that could have prevented derailments like the one in East Palestine.

Shaw noted that while the exact cause of the derailment remains under investigation by the National Transportation Safety Board, NTSB Chair Jennifer Homendy has already said that the ECP braking system rule (which was rolled back under the Trump administration) would not have applied to the NS train in Ohio.