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The analysts and financial pundits seem to have already spoken, pronouncing that Class I Norfolk Southern (NS) and its shareholders are going to be just fine in the aftermath of the East Palestine, Ohio, derailment. The experts have let us all know that what could turn out to be the largest domestic environmental disaster of our young decade won’t actually be that big of a hit for the Class I carrier.

In an article published Feb. 14 by FreightWaves, the publication stated that it estimates NS will “only” end up spending $40 million to $50 million to cover its liabilities for the derailment. Though this number is substantial when viewed against the backdrop of East Palestine’s $46,436 median household income and $88,600 median property value, the estimated price tag only amounts to 1.7% of the railroad giant’s net profits in 2022.

Based on industry standards for such incidents (this isn’t the first time a railroad disaster has spoiled the environment of a town and surrounding areas), the article estimates that any financial setback to the company and investors as a result of the Feb. 3 disaster will be overcome by May.

“As a rail service is restored, rail shares have historically not seen a material impact from accidents on a three-month horizon.” Ken Hoexter of Bank of America was quoted in the article.

Incidents of the magnitude of what happened in Ohio have the ability to alter the lives of thousands of people who live in communities near rail tracks, yet here, again, we see that they do not serve as much more than a slight dip in the quarterly lap around the corporate speedway to more profits. This is a less than encouraging reality. It begs the question whether there’s any tangible motivator for Norfolk Southern or the other Class I freight railroads to do better than simply mouthing “safety is our top priority” when the financial hit is brushed away like a piece of lint. The residents of the affected area? Well, they have to cope with the stress of homes and property tainted by chemical fallout and the anxiety of not knowing whether there will be long-lasting ramifications to their general physical and mental health as a result of the disaster while the legal wrangling occurs.

As the article in FreightWaves points out, NS had a similar derailment in 2005 in Graniteville, S.C. There, the carrier was found to be liable for 550 people being admitted to hospitals with respiratory issues, and nine deaths due to the release of chlorine. NS paid out $39 million between expenses and penalties. This resulted in a mere 1.7 percent decrease in its operating ratio for a single quarter. The financials of the company, including its stock prices, had entirely recovered by the end of that year, the article said.

While the benefits reaped by carriers seeming “too big to fail” works out just fine for the shareholders, rail labor has to cope with job cuts and compensate at an operational level for the decisions of Class I management. It’s our members who know they are being pushed to operate questionable equipment subject to relaxed safety inspections. Our men and women have front-row seats to watch the hedge fund profit-first mentality that fuels Precision Scheduled Railroading as it rots out our industry. Many workers have had the thought or have said to a manager that cultural shifts away from proper inspections and maintenance were going to create disasters like we saw in East Palestine. It turns out that we were right, but so were they in thinking the PSR playbook is still profitable, even with the occasional disaster baked into the cake. Until these carriers are financially unable to recover so quickly from these catastrophes, they have no reason to increase staffing and get back to a safety-focused culture.

So if history holds, analysts suggest, the temporary price drop in NS stock should actually be viewed as a rebound opportunity. Savvy investors could buy into the company on the cheap now, then reap the rewards when it bounces back. It’s a dark and chilling commentary on an eventual return to business as usual within months of East Palestine’s nightmare. Yet the recovery for the village’s about 4,500 residents will take substantially longer.

Read the article from Freightwaves.com

SMART Transportation Division Alternate National Legislative Director Jared Cassity was a guest of The Rick Smith Show podcast released on Friday night.

In the interview, Smith and Alt. NLD Cassity discussed the Norfolk Southern derailment in East Palestine, Ohio, and the role Precision Scheduled Railroading potentially played in causing it.

The interview clip will not only give insight on the disaster itself, but will help you provide answers when friends and family ask you how this occurred and whether they should be worried about this kind of accident happening on a main line near them.

Watch on-the-ground reporting from East Palestine, Ohio from SMART News.

Prior to the lifting of an evacuation order for residents of East Palestine, Ohio, SMART officers and members pitched in to assist the displaced residents with supplies and other support.

Due to the massive Norfolk Southern derailment there on Friday, February 3, and the hazardous materials release, lives in the community were turned upside down with many having to relocate temporarily in community shelters.

SMART-TD Ohio State Legislative Director Clyde Whitaker delivers supplies to a shelter for residents displaced by the East Palestine, Ohio, derailment on Feb. 8.

SMART-TD Ohio State Legislative Director (SLD) Clyde Whitaker, along with representatives of SMART International went to one of the shelters to bring supplies and lend support. SLD Whitaker and the other members of SMART listened to the concerns of the residents at the Family Assistance Center that was set up at Abundant Life Fellowship Church in New Waterford, OH.

The scene at the shelter was not a memory that Whitaker will forget anytime soon. Concerns were voiced that ranged from the immediate needs of food, shelter and clothing to the long-term environmental condition of the soil, air, and water in the town. Much of the discussion focused on how the future would look in this proud community, and what kind of remediation effort they could expect to see from the carrier.

“This really hit home to a lot of us. It’s the biggest catastrophe that I’ve seen in my 23 years of railroading here in Ohio,” Whitaker said.

Some of the most heated discussions revolved around air quality concerns. The large-scale chemical fire that was the result of Friday’s derailment and Tuesday’s “controlled release” of chemicals by NS created more than just the pictures that have been circulated through both local and national news media. It also created serious health concerns. Though the residents have been assured throughout this process that testing continues to show that the air is safe to breathe, many of the people at the shelter Wednesday remained skeptical.

Residents of East Palestine, Ohio, talk while sheltering at Abundant Life Fellowship Church on Wednesday, Feb. 8.

One of the East Palestinians SMART talked with was a mother who asked to be identified only as Britt. She is deeply concerned because of her daughter’s asthma. Britt gave details about her daughter’s condition having been well controlled, and that she had not had an episode in some time until the derailment. When Britt and her family attempted to evacuate, her daughter had an immediate flare up of her condition with the very limited exposure of walking from the family’s front door to their car in the driveway.

Stories like Britt’s as well as multiple accounts of fish and animals being affected by the current conditions have the community worried about the immune compromised as well as the long-term effects for their community as a whole.

SMART-TD Ohio State Legislative Director Clyde Whitaker gives a hat to a resident displaced by the East Palestine, Ohio, derailment on Feb. 8.

NS, the NTSB and a few local churches also helped by establishing shelters for the displaced families.

SMART-TD would like to thank SLD Whitaker and his team for their commitment to community outreach, and we will continue to keep Britt’s family and all of East Palestine in mind as we advocate for safety measures throughout the rail industry.

Those wishing to contribute donations to the community of East Palestine, Ohio, due to the major Norfolk Southern derailment Friday are urged to pitch in to assist evacuees of the village near the Ohio-Pennsylvania border.

The NTSB will be the lead agency for providing updates on the incident. They’ve established a Family Assistance Center to address the needs of the community and support those directly impacted.

A charred rail car is seen at the site of the East Palestine, Ohio, in this photo taken Sunday by the SMART-TD Public Relations Department.
Smoke rises from tanker cars at the site of the Norfolk Southern derailment in East Palestine, Ohio, in this photo taken Sunday by the SMART-TD Public Relations Department.

“The community needs all the help they can get,” SMART Transportation Division Ohio State Legislative Director Clyde Whitaker said. “These are citizens of our state, our neighbors and they need some help. Let’s show everyone what we can do.”

Here are the various community outreach programs available:

Brightside Project, 483 E Pershing St. Salem OH Phone: 234-320-4005 is offering food and personal care products from 9 a.m. to 3 p.m. Feb 7-9.

First United Methodist Church, 244 S. Broadway, Salem, OH Phone: 330-337-9351 is distributing clothes 9 a.m.-noon.

The Way Station is offering food, personal care products, diapers and clothing. Collection times at 769 Springfield Rd, Columbiana OH are 10 a.m.- 4 p.m. Monday – Friday. And from 9 a.m. – 2 p.m. at 125 W. 5th St., East Liverpool.

Donations of non-perishable food items and personal care products can be dropped off at either location during the hours listed.

Angels for Animals is providing assistance with pet care — 330-502-5352

Norfolk Southern has opened a family assistance center that has set up at the Abundant Life Fellowship Church in New Waterford 46469 Route 46, New Waterford, OH.

The National Transportation Safety Board (NTSB) has been launched to investigate a 50-car Norfolk Southern derailment that caused an inferno in East Palestine, Ohio, the night of Feb. 3.

According to WKBN, a state of emergency was declared by the mayor of the village with a population of just over 4,700 people on the Ohio-Pennsylvania border.

No injuries were reported from the fiery accident, which news media said produced plumes of smoke that registered on Pittsburgh weather radar.

As of Saturday morning, residents located within a mile radius of the accident site were evacuated and others were urged to stay indoors while emergency personnel worked to control the fire.

The village’s mayor reported that the crew was unharmed in the accident.

Thomas Wall

Switchman Thomas A. Wall, 22, of Local 206 (Peru, Ind.) died suddenly on Oct. 19 after experiencing a flare-up of an autoimmune liver disease while at work. His family said that he was responding well to treatment and was looking forward to returning to work after undergoing a few more procedures.

A 2018 graduate of Speedway High School, Brother Wall enjoyed computer gaming and model railroading. After high school, he attended Michigan Tech University where he was a member of the Railroad Engineering & Activities Club. His dream job was to work for the railroad, a dream which came true when he hired on with Norfolk Southern earlier this year.

Brother Wall is survived by his parents Dennis (a retired railroader) and Crystal Wall; sister, Melanie Wall; grandparents, Russell and Janet Beery; many aunts, uncles, cousins and his newly-adopted cat, Nubbs. He was preceded in death by his mother, Terri L. (Glidewell) Wall; grandparents Carl and Jeanne Wall, Hubert Jr. and Gloria Ann Glidewell; as well as an uncle, Edward G. Wall.

Brother Wall enjoyed model railroading.

Donations for funeral costs may be sent directly to the family: Dennis & Crystal Wall, 2726 Patton Dr., Indianapolis, IN 46224.

SMART-TD offers our heartfelt condolences to the Wall family, Local 206 and to all who knew and worked with Brother Wall.

Follow this link to view Brother Wall’s official obituary or to leave condolences.

Members in Local 1263 (Valdosta, Ga.) are in mourning after their Local Chairperson Richard G. Keen Jr., 36, was killed in a car accident caused by a drunk driver Saturday, Sept. 10 while on his way home from work as an engineer at Norfolk Southern.

A member of SMART-TD since 2007, Keen became active in his union when he was elected local chairperson in 2015, a position he still held. He also served his local as local alt. legislative rep. (2016 – present), S&T (2018 – 2020) and as alternate delegate for the 2019 convention.

“Richard was a valued member of our union and a strong leader,” wrote Georgia State Legislative Director Matt Campbell. “He believed in doing what was right and holding the railroad accountable for their actions. But more than all that, Richard was a good man, he was funny, and he was a loyal friend. I am so thankful that I knew this man. He will be so missed by all of us.”

GCA-898 General Chairperson Tom Gholson wrote in an email: “As many of you may not have known him, I can assure each of you that didn’t, when you met him you would like him and find something in common. While he was local chairman of Local 1263 he helped rebuild many of the past relationships that were tarnished by old union politics. He placed the membership foremost in priority and was selfless with his work as secretary and treasurer and local chairman. While his body will no longer be with us, the memories we shared together will live on in the meetings to come.”

In his spare time, Keen loved spending time with his children, fishing and working on cars. He loved to help people and could always make them laugh.

Keen is survived by his wife, Mechelle Keen; children Kaleb, Emerson and Harper Keen; father Richard Keen Sr.; mother Bernice Moore; sisters Heather Campbell and Brooke Rowan; Brothers Amy Brad Rowan and Josh Rowan; grandmother Gail Reed; and his in-laws. He also leaves behind his best friends and mentors Patrick Folsom (1st GCA vice chairperson for NS GO 898), Richard Parry and James Warren. He was predeceased by his paternal grandparents Carolyn Cowart and George Keen; and his maternal grandfather Robert Reed.

A visitation will be held Thursday, September 15 from 12 – 2 p.m. at the Warren Funeral Services of Quitman Chapel, 100 S. Second St., Quitman, GA 31643. A funeral service will immediately follow at 2 p.m., followed by interment at Riverview Memorial Gardens Cemetery, Valdosta, Ga.

A GoFundMe has been established by Patrick Folsom to support the family. Folsom is also accepting checks or money orders and will deliver them to Keen’s wife. Please mail checks to Patrick Folsom, 3330 Empress Road, Quitman, GA 31643.

Follow this link to leave condolences for the family or to read the official obituary.

Follow this link to make an online donation.

SMART-TD offers our heartfelt condolences to Keen’s family, friends, Local 1263 and all who knew him.

Class I railroad carriers BNSF and NS declared an impasse this week in the mandatory bargaining over crew size under Section 6 of the Railway Labor Act (RLA). In declaring an impasse, the two railroads, represented by the National Railway Labor Conference (NRLC), seek federal mediation as required by the RLA. Union Pacific Railroad is not seeking mediation at this time.

Beginning in October 2019, most Class I carriers served notice under Section 6 of the RLA to force the SMART Transportation Division to bargain over crew size. Today crew size is determined by collective bargaining agreements implemented by Presidential Emergency Board 219 under then-President George H.W. Bush.

SMART-TD and the involved General Committees intend to continue to demonstrate the significant problems with the carriers’ plans and the current technology that carriers believe allows for a redeployment of conductors to ground-based positions.

SMART-TD General Committees and union leadership will continue to fight to protect the jobs of today as well as the jobs of the future and to ensure protection for SMART-TD members.

In the current episode of Talking SMART, we sit down with SMART TD President Jeremy Ferguson to talk about a subject that is foremost on the minds of many members. In February 2022, BNSF arbitrarily changed its attendance policy and took advantage of a pro-management judge to force (as of now… this episode was recorded in early March), a draconian “Hi-Viz” attendance policy upon the very members who have kept the company operational through the pandemic – and who earned BNSF record profits in 2021. President Ferguson also provides an update on contract negotiations with the national rail carriers.


4th Quarter 2021
Net Earnings: Increased 13% to $1.7 billion from $1.5 billion
Diluted Earnings Per Share: n/a – BNSF is not publicly traded
Revenue: Increased 11% to $6.3 billion from $5.7 billion
Operating Income: Increased 12% to $2.4 billion from $2.2 billion
Operating Expenses: Increased 10% to $3.9 billion from $3.5 billion
Operating Ratio: Improved to 60.0% from 60.3%


2021 Annual Earnings
Net Earnings: Increased 16% to $6.0 billion from $5.2 billion
Diluted Earnings Per Share: n/a – BNSF is not publicly traded
Revenue: Increased 12% to $23.3 billion from $20.9 billion
Operating Income: Increased 14% to $8.8 billion from $7.7 billion
Operating Expenses: Increased 10% to $14.5 billion from $13.1 billion
Operating Ratio: Improved to 60.9% from 61.6%
Read BNSF’s full earnings report.


4th Quarter 2021
Net Earnings: Increased 17% to C$1.20 billion from C$1.02 billion
Diluted Earnings Per Share: Increased 18% to $1.69 per share from $1.43 per share
Revenue: Increased 3% to C$3.75 billion from C$3.66 billion
Operating Income: Increased 11% to a record C$1.57 billion from C$1.41 billion
Operating Expenses: Decreased 1% to C$2.19 billion from C$2.25 billion
Operating Ratio: Improved 3.1 points to 58.3% from 61.4%

2021 Annual Earnings
Net Earnings: Increased 37% to C$4.90 billion from C$3.60 billion
Diluted Earnings Per Share: Increased 38% to $6.89 per share from $5.00 per share
Revenue: Increased 5% to C$14.48 billion from C$13.82 billion
Operating Income: Increased 18% to C$5.62 billion from C$4.78 billion
Operating Expenses: Decreased 2% to C$8.86 billion from C$9.04 billion
Operating Ratio: Improved 4.2 points to 61.2% from 65.4%
Read CN’s full earnings report.


4th Quarter 2021
Net Earnings: Decreased 34% to C$532 million from C$802 million
Diluted Earnings Per Share: Decreased 38% to $0.74 per share from $1.19 per share
Revenue: Increased 1% to C$2.04 billion from C$2.01 billion
Operating Income: Decreased 10% to C$832 million from C$928 million
Operating Expenses: Increased 11% to C$1.21 billion from C$1.08 billion
Operating Ratio: Worsened 530 basis points to 59.2% from 53.9%

2021 Annual Earnings
Net Earnings: Increased 17% to C$2.9 billion from C$2.44 billion
Diluted Earnings Per Share: Increased 16% to $4.18 per share from $3.59 per share
Revenue: Increased 4% to C$8.0 billion from C$7.71 billion
Operating Income: Decreased 3% to C$3.21 billion from C$3.31 billion
Operating Expenses: Increased 9% to C$4.80 billion from C$4.40 billion
Operating Ratio: Worsened 280 basis points to 59.9% from 57.1%
Read CP’s full earnings report.


4th Quarter 2021 
Net Earnings: Increased 23% to $934 million from $760 million
Earnings Per Share: Increased 27% to $0.42 per share from $0.33 per share
Revenue: Increased 21% to $3.43 billion from $2.83 billion
Operating Income: Increased 12% to $1.37 billion from $1.22 billion
Operating Expenses: Increased 28% to $2.1 billion from $1.6 billion
Operating Ratio: Worsened to 60.1% from 57.0%

2021 Annual Earnings
Net Earnings: Increased 37% to $3.8 billion from $2.8 billion
Earnings Per Share: Increased 40% to $1.68 per share from $1.20 per share
Revenue: Increased 18% to $12.52 billion from $10.58 billion
Operating Income: Increased 28% to $5.6 billion from $4.4 billion
Operating Expenses: Increased 11% to $6.9 billion from $6.2 billion
Operating Ratio: Improved to 55.3% from 58.8%
Read CSX’s full earnings report.


4th Quarter 2021
Net Earnings: Increased 258% to $595.1 million from $166.3 million
Earnings Per Share: On December 14, 2021, Canadian Pacific Railway acquired the outstanding common and preferred stock of KCS. Therefore, earnings per share data is not presented because the company does not have any outstanding or issued publicly traded stock.
Revenue: Increased 8% to $747.8 million from $693.4 million
Operating Income: Increased 209% to $810.6 million from $262.3 million
Operating Expenses: Decreased 115% to a negative $62.8 million from $431.1 million due to the merger
Operating Ratio: Improved 70.6 points to –8.4% from 62.2%

2021 Annual Earnings 
Net Earnings: Decreased 15% to $527 million from $619 million
Earnings Per Share: On December 14, 2021, Canadian Pacific Railway acquired the outstanding common and preferred stock of KCS. Therefore, earnings per share data is not presented because the company does not have any outstanding or issued publicly traded stock.
Revenue: Increased 12% to $2.95 billion from $2.63 billion
Operating Income: Decreased 12% to $884 million from $1.00 billion
Operating Expenses: Increased 27% to $2.06 billion from $1.63 billion
Operating Ratio: Worsened 8.1 points to 70.0% from 61.9%
Read KCS’s full earnings report.


4th Quarter 2021
Net Earnings: Increased 13% to $760 million from $671 million
Diluted Earnings Per Share: Increased 18% to $3.12 per share from $2.64 per share
Revenue: Increased 11% to $2.9 billion from $2.6 billion
Operating Income: Increased 15% to a 4th quarter record of $1.1 billion from $1.0 billion
Operating Expenses: Increased 8% to $1.7 billion from $1.59 billion
Operating Ratio: Improved 2% to a 4th quarter record 60.4% from 61.8%

2021 Annual Earnings 
Net Earnings: Increased 27% to $3 billion from $2 billion
Diluted Earnings Per Share: Increased 31% to $12.11 per share from $7.84 per share
Revenue: Increased 14% to $11.1 billion from $9.8 billion
Operating Income: Increased 28% to a record $4.4 billion from $3.0 billion
Operating Expenses: Decreased 1% to $6.7 billion from $6.8 billion
Operating Ratio: Improved 7% to an all-time record of 60.1% from 69.3%
Read NS’s full earnings report.

4th Quarter 2021 
Net Earnings: Increased 24% to $1.7 billion from $1.4 billion
Earnings Per Share: Increased 30% to $2.67 per share from $2.05 per share
Revenue: Increased 12% to $5.7 billion from $5.1 billion
Operating Income:  Increased 22% to $2.4 billion from $2.0 billion
Operating Expenses: Increased 5% to $3.3 billion from $3.1 billion
Operating Ratio: Improved 3.6 points to 57.4% from 61.0%

2021 Annual Earnings 
Net Earnings: Increased 22% to $6.5 billion from $5.3 billion
Earnings Per Share: Increased 26% to $9.98 per share from $7.90 per share
Revenue: Increased 12% to $21.8 billion from $19.5 billion
Operating Income: Increased 19% to $9.3 billion from $7.8 billion
Operating Expenses: Increased 7% to $12.5 billion from $11.7 billion
Operating Ratio: Improved 2.7 points to 57.2% from 59.9%

“The Union Pacific team concluded its most profitable year ever in 2021. We produced double-digit fourth-quarter revenue growth by leveraging our great rail franchise to generate positive business mix and core pricing gains,” UP CEO Lance Fritz said.
Read UP’s full earnings report.

Notes: 

  • Operating ratio is a railroad’s operating expenses expressed as a percentage of operating revenue, and is considered by economists to be the basic measure of carrier profitability. The lower the operating ratio, the more efficient the railroad.
  • All comparisons are made to 2020’s fourth-quarter and 2020 year-end results respectively for each railroad.
  • All figures for CN & CP are in Canadian currency, except for earnings per share.

CLEVELAND, Ohio, (Oct. 29, 2021) — The Transportation Division of the International Association of Sheet Metal, Air, Rail, and Transportation Workers (SMART-TD) and the Brotherhood of Locomotive Engineers and Trainmen (BLET) have responded to the suit Norfolk Southern Railway (NS) filed against them on Oct. 21, 2021, in the United States District Court for the Northern District of Illinois, Chicago Division. The two Organizations not only answered NS’ allegations, they also filed counterclaims challenging NS actions in implementing their vaccine policy without the bargaining mandated by the Railway Labor Act.
The railroad has taken the position that it has the right to implement and enforce a COVID vaccination mandate among its employees, and requests the court to issue a declaratory judgment holding that the dispute between the railroad and the unions is a “minor” dispute, which must be arbitrated if the parties cannot come to a satisfactory settlement.
The unions have countered that NS has no such authority, and their actions in failing to negotiate terms of implementation violate the status quo requirement of the Railway Labor Act, thus engendering a major dispute.
SMART-TD President Jeremy Ferguson and BLET National President Dennis Pierce issued the following joint statement regarding their action:
“NS has ordered all employees to report that they are fully vaccinated by December 8th, or they will be unable to continue working. And, instead of negotiating with us as the law requires, the Carrier is directly dealing with its employees by offering a payment for compliance with its unilateral mandate.
“We generally support our members getting the vaccine. However, we have several objections to NS’s unilateral implementation of their policies mandating them and illegally dealing directly with its represented employees. The members of our Unions — including members who already are vaccinated — are irate over NS’s outrageous conduct.
“We have been in contract negotiations with NS since November of 2019, and federal law absolutely bars railroads from changing rates of pay, rules and working conditions while negotiations are ongoing. Not only is NS in violation of the law, it has explicitly spurned our demands that these matters be bargained. We will continue to fight on behalf of all BLET and SMART–TD members in an effort to stop NS’s lawlessness in its tracks.”

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The SMART Transportation Division is comprised of approximately 125,000 active and retired members of the former United Transportation Union, who work in a variety of crafts in the transportation industry.
The Brotherhood of Locomotive Engineers and Trainmen represents nearly 57,000 professional locomotive engineers and trainmen throughout the United States. The BLET is the founding member of the Rail Conference, International Brotherhood of Teamsters.