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Mayor Martin O'Malley and CSX Corp.'s chairman and chief executive officer, Michael J. Ward, said the railroad will defray the city's costs from the fire and the cleanup without either side admitting fault in the July 2001 accident.
"Rather than continuing to litigate, both parties have agreed to dedicate shared resources and energy to further enhance safety and security in the city," O'Malley and Ward said in a statement yesterday announcing the settlement.
City Solicitor Ralph S. Tyler said the deal achieves the purposes of Baltimore's $10 million federal lawsuit against the Jacksonville, Fla.-based CSX Transportation, the rail unit of CSX Corp.
"By this settlement, the city has recovered substantially all the expenses incurred as a result of the derailment and fire," Tyler said.
He noted that CSX had previously agreed to pay more than $300,000 in overtime for city workers. The agreement does not include payment of legal expenses, but Tyler said the city handled the case using in-house lawyers rather than retaining outside counsel.
Other provisions of the agreement require more sharing of information by the city and the company, including police radio transmissions and images from security cameras in the tunnels.
The railroad agreed to share more information about shipping patterns and the movement of hazardous cargo through the city. The agreement does not explicitly call for advance notification of hazardous shipments, but one provision says the railroad and Baltimore will "jointly develop" a plan to enable city officials "to identify what types of chemicals" are passing through.
The two parties, which have a history of tense relations, also committed to forge what Tyler called "a new relationship" on safety. They agreed to jointly request an inspection of the tunnel by federal and state agencies. The railroad agreed to perform any repairs that might be required by regulators.
The more than century-old 1.7-mile tunnel running under Howard Street was a little-noticed part of Baltimore's underground infrastructure when 11 freight cars of a 60-car CSX train - including tank cars carrying toxic chemicals - derailed July 18, 2001. One car, carrying the flammable chemical tripropylene, ruptured and caught fire.
The resulting fire reached temperatures estimated at 1,500 degrees Fahrenheit and filled the downtown air with acrid smoke. The fumes forced the evacuation of
The firefighting effort trapped drivers in downtown congestion for hours and snarled traffic in the city for the next several days as emergency crews struggled to bring the fire under control.
A city fire lieutenant described the scene as "a little bit of hell." It would take three days for firefighters to extinguish the fire and a week before the tunnel could reopen. The closure created a bottleneck for freight rail traffic on the Eastern Seaboard. Downtown buildings flooded and lost power after a water main burst, and key telecommunications links were severed.
In the aftermath of the fire, the city and CSX pointed fingers at each other over the cause of the accident. The railroad suggested that the water main break was a cause of the accident; the city said it was a result of the fire.
A 3 1/2 -year National Transportation Safety Board investigation of the accident was inconclusive, but the board said the most likely cause was "an obstruction between a car wheel and the rail, in combination with changes in track geometry."
The federal agency criticized CSX's maintenance recordkeeping and chided the city and the railroad for communications lapses during the incident. The NTSB discounted the possibility that the water main break caused the derailment.
The city filed suit against CSX in July 2004. The case had been scheduled for trial March 13. Instead, the O'Malley administration will seek the Board of Estimates' approval of the deal Feb. 22.
Among the provisions:
Tyler said the three main components of the agreement were the financial settlement, improved communications and the tunnel inspection.
The agreement specifies that CSX and the city will jointly request an inspection by the Federal Railroad Administration and state regulators - focusing particularly on a culvert where the city's experts believe the derailment took place.
Lawrence Mann, a lawyer who specializes in railroad safety cases, said the agreement appears to be a good one for Baltimore except for "a big loophole"- the absence of language requiring prenotification before CSX brings hazardous cargo through the city.
"The main problem I've found [in rail accidents] around the country is knowing promptly what's in there," said Mann, of the Washington firm of Alper & Mann. "You need to know real-time what's involved in a hazardous material accident."
City Councilman Kenneth N. Harris Sr., who introduced legislation that would have restricted shipments of some hazardous chemicals through the tunnel, said he believed the bill helped push the railroad to settle.
Harris, who said he put the legislation on hold in November to let the talks proceed, called the deal "a step in the right direction." He said he would review the settlement's terms and decide whether to move forward with the bill or withdraw it.