Feds reach $20M settlement with Durango & Silverton Narrow Gauge Railroad after 416 Fire

Railroad still says it is not responsible for causing fire
416 Fire 15 percent contained and still growing
Posted at 5:50 PM, Mar 21, 2022
and last updated 2022-03-21 20:19:15-04

DENVER – The Durango & Silverton Narrow Gauge Railroad Company and its parent company will pay $20 million to the U.S. government for damage caused by the 2018 416 Fire near Durango under a settlement agreement announced Monday.

According to the U.S. Attorney’s Office for the District of Colorado, the company will also adjust its operations and come into compliance with a new operating and fire prevention plan that it will have to update every year to mitigate fire danger from the antique locomotive, which sparked the 54,000-acre fire.

U.S. Attorney Cole Finegan said the government intends for the settlement to keep the railroad and its parent company, American Heritage Railways, operational, “but in a manner that will avoid causing future catastrophic wildfires,” he said.

The government sued the railroad in July 2019, seeking compensation for firefighting and environmental rehabilitation efforts, which the feds said at the time cost approximately $25 million.

The filing maintained the first public announcement that the train caused the fire, though it had long been suspected as the source by locals.

The fire, which sparked on June 1, 2018, in the San Juan National Forest outside of Durango, was active for 61 days and was not declared extinguished until late November.

A federal investigation and a separate private investigation both reached the same conclusions that the railroad locomotive that burns coal was the source of the fire.

It had a metal screen over its exhaust stack to capture burning exhaust particles but that the screen did not trap every particle. It says that some of those particles ended up on the ground next to the railroad and sparked a small brush fire, which then spread.

The lawsuit named several other fires in the area started by the train, including the 2012 Goblin Fire, the 2012 Needleton Fire and the 2002 Schaff II Fire.

The government was seeking compensation from the railroad company under Colorado Revised Statute § 40-30-103, which states: “Every railroad operating its line of road, or any part thereof, within this state shall be liable for all damages by fires that are set out or caused by operating any such line of road, or any part thereof, in this state, whether negligently or otherwise.”

The agreement will come in the form of a consent decree, the U.S. Attorney’s Office said Monday.

Under the consent decree, the railroad will pay $15 million within 45 days of signing the settlement and then pay the additional $5 million, plus interest, over a 10-year period.

The Durango & Silverton Narrow Gauge Railroad will also have to comply with a plan that limits its operations when there is elevated fire risk and shuts the railroad down under conditions for extreme wildfire potential.

It will also have to prepare and submit a operating and fire prevention plan to the U.S. Forest Service annually and retain an independent consultant who will review, audit and make recommendations on the railroads fire prevention measures.

The railroad will also have to hire a full-time fire management officer, maintain at least $3 million in in wildfire insurance coverage, and fund a wildfire fund to the tune of $100,000 a year to pay for any future wildfire costs it causes.

The railroad maintains it did not cause the 416 Fire and did not admit guilt as part of the settlement, the U.S. Attorney’s Office said. A private lawsuit is ongoing.

“When finalized, the proposed settlement and subsequent operational changes will help protect southwestern Colorado’s communities, cultural, and natural resources from future wildfires,” said Frank Beum, the regional forester for the USFS. “We look forward to continuing our partnership with the Durango and Silverton Narrow Gauge Railroad Company and American Heritage Railways.”

The 416 Fire is the eighth largest in Colorado history.

These are the state's 10 largest wildfires, ranked by acreage:
1. Cameron Peak Fire (2020): 208,913 acres
2. East Troublesome Fire (2020): 193,812 acres
3. Pine Gulch Fire (2020): 139,007 acres
4. Hayman Fire (2002): 137,760 acres
5. Spring Fire (2018): 108,045 acres
6. High Park Fire (2012): 87,284 acres
7. Missionary Ridge Fire (2002): 72,962 acres
8. 416 Fire (2018): 54,000 acres
9. Bridger Fire (2008): 45,800 acres
10. Last Chance Fire (2012): 45,000 acres
Note: The Rocky Mountain Area Coordination Center said the West Fork Complex fire, which burned a total of 109,632 acres in 2013, is not included on this list since it involved three separate fires.