Norfolk Southern CEO apologizes for Ohio crash, but won’t back bipartisan rail safety bill
Railroad company spent $3.4 billion on stock buybacks last year, while it has cut 38% of its workforce in the last 10 years, Ohio senator says
On Feb. 3, a Norfolk Southern Railway train derailed in East Palestine, a town of nearly 5,000 residents, leading to the release of dangerous chemicals through a controlled burn to prevent an explosion. It forced residents to evacuate the area. (Courtesy of the U.S. Environmental Protection Agency)
The CEO of Norfolk Southern, the railroad operating the train that last month derailed and spilled toxic chemicals in East Palestine, Ohio, apologized for the derailment at a U.S. Senate hearing Thursday, but declined solicitations to endorse a bipartisan rail safety bill.
Norfolk Southern CEO Alan Shaw opened his testimony to the Senate Environment and Public Works Committee with an apology to residents of the community and pledged “to make this right,” though he resisted senators’ invitations to endorse policy specifics.
“I want to begin today by expressing how deeply sorry I am for the impact this has had on the residents of East Palestine and the surrounding communities,” Shaw said.
“I am determined to make this right. Norfolk Southern will clean the site safely, thoroughly and with urgency. You have my personal commitment. Norfolk Southern will get the job done and help East Palestine thrive.”
The railroad has announced direct investments of $21 million and helped more than 4,000 families through an assistance center, Shaw said, calling that spending “just a down payment.”
Senators seek support for rail safety legislation
Senators on the panel, including those from Ohio and neighboring Pennsylvania, sought Shaw’s endorsement for a rail safety bill and other policy proposals — but were rebuffed.
U.S. Sen. Sherrod Brown, an Ohio Democrat, was among the three Democrats and three Republicans who introduced a bill last week that would increase civil penalties for railroad safety violations, increase inspections of wheel bearings and create other safety regulations.
The bill’s sponsors from Ohio and Pennsylvania — Brown, Ohio Republican J.D. Vance and Pennsylvania Democrats Bob Casey and John Fetterman — all promoted it at Thursday’s hearing, though Fetterman did so by sending written questions to committee Chairman Tom Carper. Republican Sens. Marco Rubio of Florida and Josh Hawley of Missouri were the measure’s other original cosponsors.
“It’d be a good start by Norfolk Southern to tell us today, in addition to what more they’re going to do for the people of Ohio and Pennsylvania … that they support the bill,” Casey said. “That would help, if a major rail company said we support these reforms, and we’ll help you pass this bill.”
Vance, a new senator who was elected on a populist message, also urged his fellow Republicans to support the rail safety bill. A political realignment over the past 30 years meant Republicans should not be afraid to establish additional regulations on the railroad industry, he said.
“I believe that we are the party of working people, but it’s time to be the party of working people,” he said. “We have a choice. Are we for big business and big government or are we for the people?”
Vance added that he had initially been frustrated with Norfolk Southern’s response to the Feb. 3 disaster, but said the railroad had “finally started to do the cleanup in earnest.”
Now, Vance said, the problem slowing down the cleanup was the U.S. Environmental Protection Agency’s delay in approving the removal of toxic materials.
“We need leadership,” he said. “We need the EPA to get on the ground and aggressively get this stuff out of East Palestine into properly licensed facilities.”
Fetterman, who has been absent from the Capitol as he receives medical treatment for depression, relayed to Carper, a Delaware Democrat, questions for Shaw.
In those questions, Fetterman asked if Shaw would support the bill.
Shaw said the company supported “the legislative intent to make railroads safer,” and could support some provisions of the bill, but declined to offer an endorsement for the measure in its entirety.
Democrats blame greed, push for commitments
Brown blamed the derailment on the railroad for prioritizing its executives’ compensation and stock price over safety. Norfolk Southern spent $3.4 billion on stock buybacks last year, he said, while it has cut 38% of its workforce in the last 10 years.
The money spent on stock buybacks could have gone to hiring track inspectors or safety equipment, he said.
“Norfolk Southern chose to invest much of its massive, massive profits in making its executives and shareholders wealthy at the expense of Ohio communities along its rail tracks,” Brown said.
Shaw said a federal National Transportation Safety Board investigation showed no evidence that additional personnel would have prevented the derailment.
Oregon Democrat Jeff Merkley asked Shaw to commit to halt stock buybacks until the company finished making safety improvements.
Shaw declined, though he said the railroad would invest in safety.
Sen. Edward Markey, a Massachusetts Democrat, pushed Shaw to commit to compensate homeowners and small businesses for the loss in value of their real estate.
Shaw would say only that he was “committing to do what’s right for the community.”
Markey said Norfolk Southern would have to balance what’s right for the community with what is in the best interest of the railroad, predicting the company would continue to offer stock buybacks and would sue to avoid paying for the harm to East Palestine residents.
Communication issues undermine trust, senators say
The cleanup efforts, which involved federal, state and local authorities as well as Norfolk Southern, have been rife with communication mishaps, senators said.
U.S. Sen. Debbie Stabenow, a Michigan Democrat, said neither her office nor state officials, including Gov. Gretchen Whitmer and state environmental regulators, were notified that Norfolk Southern was bringing waste from the accident into Michigan.
Norfolk Southern and EPA officials could not tell where the toxic material was sent, ranking Republican Shelley Moore Capito of West Virginia said. That lack of communication made local residents more fearful, she said.
“What does that do to trust?” she said. “We just need to get some transparency of where this material is going, how long it’s going to take to get out.”
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