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ATTACHMENT #1 Regular SA&T meeting of 02/27/2007 Safety Advisory and Transportation Committee Briefing February 27, 2007

AGENDA • Overview of Norfolk Southern Railway Company • Formation and organization of the subsidiary Delaware Business Unit (DBU) • Railroad safety • Hazardous materials transportation by railroad

Since 1980, U.S. Class I railroads have spent $340 billion on track and equipment. Capital Expenditures and Maintenance Expenses, Excluding Depreciation, in Billions of Dollars 10.0 8.0 Equipment 6.0 Track & Structures 4.0 2.0 0.0 1980 1985 1990 1995 2000 2004 Sources: AAR, Analysis of Class I Railroads, 1980 - 2004, based on R-1 Reports submitted by each Class I railroad to the ICC/STB. Equipment: Lines 382+158-151-154-157. Track: Lines 378+149-147. Note: Current year dollars.

Since 1991, U.S. Class I railroads have accelerated capital spending on new rail. Billions of Current Dollars 2.0 1.5 Capital Expenditures on Rail 1.0 0.5 Operating Expenses for Rail & Other Track Material 0.0 1987 1989 1991 1993 1995 1997 1999 2001 2003 Source: R-1 Reports submitted by each Class I railroad to the ICC/STB, 1987-2004. Schedule 330, line 8, column e; Schedule 410, lines 1, 14, and 15, column h.

Delmarva Business Unit • Created in 2006 • NS Eastern North Carolina parallels • Capital budget challenges • Amtrak Northeast Corridor Track Gateway • Improved localized management

U.S. Railroad Safety Statistics: Main Themes • Railroads have dramatically improved safety over the last two and a half decades. • Railroads compare favorably with other industries & transportation modes. • The most troubling railroad safety problems arise from factors largely outside railroad control. • Railroads have implemented numerous and effective technological improvements and company-wide safety programs.

Derailments per million train-miles have dropped 65% since 1980 and 12% since 1990. 10 8.98 8 6 4 3.52 3.11 2 0 1980 1985 1990 1995 2000 2004 Sources: FRA website: http://safetydata.fra.dot.gov/Prelim/2004/r01.htm & r02.htm (preliminary 2004 data) FRA, Railroad Safety Statistics Annual Report, 1997-2004, Tables 1-1, 5-6. FRA, Accident/Incident Bulletin, 1980-1996, Tables 19, 36. Note: Excludes grade crossing accidents.

Train accidents per million train-miles have dropped 62% since 1980 and 8% since 1990. 12 11.43 10 8 6 4.73 4 4.33 2 0 1980 1985 1990 1995 2000 2004 Sources: FRA website: http://safetydata.fra.dot.gov/Prelim/2004/r01.htm (preliminary 2004 data). FRA, Railroad Safety Statistics Annual Report, 1997-2004, Tables 1-1, 1-2. FRA, Accident/Incident Bulletin, 1980-1996, Tables 19, 36. Note: Excludes grade crossing accidents.

Human factors-caused accidents per million train-miles have dropped 46% since 1980 and 3% since 1990. 3.5 3.24 3.0 2.5 1.80 2.0 1.74 1.5 1.0 0.5 0.0 1980 1985 1990 1995 2000 2004 Sources: FRA website: http://safetydata.fra.dot.gov/Prelim/2004/r01.htm & r02.htm (preliminary 2004 data) FRA, Railroad Safety Statistics Annual Report, 1997-2004, Tables 1-1, 5-9. FRA, Accident/Incident Bulletin, 1980-1996, Tables 19, 36. Note: Excludes grade crossing accidents.

Accidents with a hazmat release have declined 76% since 1980 and 17% since 1990. Train Accidents with a Hazmat Release 140 119 120 100 80 60 40 29 20 35 0 1980 1985 1990 1995 2000 2004 Sources: FRA, RR Safety Statistics Annual Report, 1997-2004, Tables 6-1. FRA, Accident/Incident Bulletin, Table 26. Note: An accident may involve releases from more than one car. AAR Analysis of FRA Train Accident Database through 2004.

Railroad Industry Safety Programs: Hazardous Materials • AAR North American Non-Accident Release (NAR) Program • Transportation & Community Awareness & Emergency Response (TRANSCAER) • ACC Responsible Care • Operation Respond • TTCI's Emergency Response Training Center • TTCI's BOE Hazmat Inspections • TTCI's BOE Hazmat Safety Information

Hazmat incident release rates have declined 72% since 1980 and 58% since 1990. Incidents per Thousand Hazmat Carloads 1.6 1.52 1.4 1.2 0.99 1.0 0.8 0.6 0.42 0.4 99.96% Incident Free 0.2 0.0 1980 1985 1990 1995 2000 2004 Sources: USDOT, Pipeline & Hazardous Materials Safety Administration, Hazardous Materials Incidents by Year & Mode. http://hazmat.dot.gov/files/hazmat/10year/10yearfrm.htm for 1995-2004. Includes releases in train accidents as well as non-accident releases. ICC/STB Waybill Sample. 1995-2004. Carloadings adjusted to counter known hazmat underreportings of hazmat designations.

Railroads now have less than 1/4 of the hazmat accidents that trucks have, despite roughly equal hazmat ton-mileage. 400 350 300 250 200 Truck 150 Railroad 100 50 0 1994 1996 1998 2000 2002 2004 Sources: USDOT, Pipeline & Hazardous Materials Safety Administration, Hazardous Materials Incidents by Year & Mode, from http://hazmat.dot.gov/pubs/inc/data/tenyr_accd.pdf. 11/14/2005 In 2003, both the truck and rail modes hauled an estimated 110 billion ton-miles of hazmat.

Grade crossing collisions have declined 71% since 1980 and 46% since 1990. 12,000 10,611 10,000 8,000 6,000 5,715 4,000 3,067 2,000 0 1980 1985 1990 1995 2000 2004 Sources: FRA, Railroad Safety Statistics Annual Report, 1997-2004, Table 1-1. FRA Highway/Rail Crossing Accident/Incident & Inventory Bulletin,Table S, FRA website: http://safetydata.fra.dot.gov/Prelim/2004/r01.htm (preliminary 2004 data) Note: Includes accidents involving pedestrians. Includes accidents at private crossings.

In 2004, 94% of rail-related fatalities were grade crossing users and trespassers. Grade Crossing Users: 364 Trespassers: 482 Employees: 25 Passengers: 3 Others: 24 Sources: FRA website: http://safetydata.fra.dot.gov/Prelim/2004/r03.htm (preliminary 2004 data). FRA, Railroad Safety Statistics Annual Report 2004, Table 1-3.

Railroad Security • After the 9/11 terrorist attacks, the AAR & its member railroads voluntarily conducted a comprehensive risk assessment and implemented a security action plan with four alert levels. • The Security Plan encompasses over 1,300 critical facilities (tunnels, bridges, yards, dispatch centers, etc.) over a 142,000-mile nationwide rail network. • The plan evolves in response to classified information obtained through DHS and FBI. • DHS has cited this plan as a model for other U.S. industries.

Railroad Security: Countermeasures include: • Employee and customer awareness and training: e.g. to thwart terrorist intelligence gathering, facilitate warning & recovery. • Sharing of Intelligence on Threats: – AAR Operations Center (24/7) collects, evaluates, and disseminates information to railroads thru the Railway Alert Network (RAN) – The Surface Transportation Information Sharing & Analysis Center (ST- ISAC) collects, analyzes, and disseminates information on physical and cyber-security threats to providers and users of surface transportation. • Vetting employees & contractors. • Controlling access to critical facilities and shipment info. • Securing communications and data and ensuring message integrity and best IT practices.

Security and Hazmats • Municipal legislation on routing • 2006 DOT DHS TIH Security Action Items for Railroads • 2006 TSA and FRA Railroad inspectors for verification of compliance • 2007 DHS TSA notice of action on TIH routes

Railroads have lower employee injury rates than do other major industry groups. Lost Workday Injuries & Illnesses per 100 Full Time Employees, 2004 5 4 3 2 1 0 DS G ro ce ry ls Ho te RO Co tor ns S t ru es A M an ctio uf n RA ac Ag ring tu IL Dep ar tm ri c ultu en tS re Source: Bureau of Labor Statistics, http://www.bls.gov/iif/oshwc/osh/os/ostb1487.pdf to re s

ATTACHMENT #2 Regular SA&T meeting of 02/27/2007

ATTACHMENT #3 Regular SA&T meeting of 02/27/2007 Why Sprinkle townhouses ¾ In line with the Cities proactive approach of fire protection. ¾ Improves the overall image of the city ¾ Fire determination made easier ¾ Meets the Cities mission statement of having a safe City.

Benefits to the public ¾5 to 10 percent discount on homeowners insurance. ¾Faster recovery for fire victims. ¾Fewer displaced families and less of a drain on support services. ¾No standby fees for fire protection water. ¾Allows the City to make amends and trade off for new construction

Benefits to the public ¾Fire protection remains intact even if the property is sold or the occupant changes ¾Increases the survivability of the occupant. ¾Less potential for the loss of family heirlooms and personal belongings. ¾Protection from fire spread from other units. ¾Assists individuals unable to initiate self preservation in surviving a fire.

Benefits to the public ¾Even when you are not at home the Sprinkler System will be. Ready to stop the fire and alert the Fire Department at a moments notice. Yes, there is a cost, but for the peace of mind that the Sprinkler System gives us knowing that our home is protected, it’s more than worth it.

Why Sprinkle Townhouses? ¾Good Fire Protection • Early detection and suppression. • Incorporates Technology as part of the Cities Fire protection program. • Less in service time for the Fire Department. • Reduces the hazards to the Firefighters. • Reduces Firefighting costs. • Helps maintain a volunteer Fire Department.

Other considerations ¾Sprinkler systems need to be installed during construction. ¾Cost of installation ranges from $2.00 to $2.25 per square foot. ¾ Equal to or less than installing carpet in the same area

Less Fire Damage ¾There is far less damage in the homes with sprinklers! – Average fire loss with sprinkler activation, $2,166 – Average fire loss without sprinkler activation, $45,019

Communities that currently sprinkle townhouses ¾Newark, Delaware ¾Camden, Delaware ¾Silver Lake Blvd. Dover ¾City of New Castle, Delaware ¾Belfonte, Delaware ¾Beach area.

Why do we sprinkler buildings? • To avoid this And this!