The Maryland Department of the Environment has issued a draft of a permit that would allow CSX Transportation to continue operating a controversial coal terminal in Curtis Bay — but only if the railway giant agrees to make changes to the site that would reduce the amount of coal dust it generates.

The draft permit, which MDE issued Thursday, would allow CSX to continue running the 10-acre site on Benhill Avenue in the South Baltimore community for another five years.

Under its terms, though, the Jacksonville, Florida-based company would have to take three actions aimed at reducing the pollution it creates: build a barrier to prevent coal dust from reaching the surrounding community ,install a mechanical system that would apply water to incoming rail cars laden with coal, and enhance water-application systems at the sheds where coal is unloaded.

Applying water to dusty materials can hold particles in place rather than allowing them to be picked up by winds and dispersed, Chris Hoagland, the director of MDE’s air and radiation administration, said Thursday.

“The regulatory standard is that [CSX] has to take reasonable precautions to reduce dust,” Hoagland said. “We’re proposing those as reasonable precautions.”

CSX’s Curtis Bay Coal Piers is one of two terminals in Baltimore that bring in coal mined largely in the Appalachian mountains and load it aboard ships and barges for export to users, mostly overseas. The other is in the Canton Industrial Area, close to the harbor tunnels’ northern entrances. Baltimore is second in the U.S. to the port in Norfolk, Virginia, in the volume of coal it handles. Last year, Baltimore shipped 23 million tons of coal, according to the U.S. Energy Information Administration.

MDE officials won’t issue a final, formal proposal until after Oct. 10, the date they plan to field comments from the public at an open hearing at the Curtis Bay Recreation Center.

The agency hadn’t shared the draft permit directly with CSX as of Thursday afternoon, but company spokeswoman Sheriee Bowman said the firm was studying it already.

“CSX is currently reviewing the draft permit issued today by the Maryland Department of the Environment (MDE) to renew our air permit to operate at the Curtis Bay Piers in Baltimore,” Bowman said in an emailed statement to The Baltimore Sun. “As we have previously stated, CSX is committed to environmental compliance and strives to protect the environment and the safety and health of the public, our customers, and employees in all aspects of our operations.”

The document’s release is the latest development in a saga that has sparked protests, triggered an exhaustive scientific investigation and led to a class-action lawsuit.

It was on Dec. 30, 2021, that an explosion rocked the coal plant and the surrounding neighborhood. Investigators found it had resulted from a buildup of methane inside a tunnel at the facility.

The blast released harmful pollutants such as nitrogen oxides, carbon monoxide and sulfur dioxide into the atmosphere, violating Maryland’s Environment Article, and MDE found that CSX had not taken “reasonable precautions” to prevent the explosion.

No one was injured in the incident, but the blast spread more coal dust through the heavily industrialized residential community and left many of its inhabitants outraged.

“We cannot live safely with a massive coal pile less than 1,000 feet from our homes and rec center,” Curtis Bay resident Terriq Thompson said in a news release at the time.

MDE reached a settlement with CSX nearly a year later: The company with a $66 billion market valuation was assessed a $15,000 penalty and ordered to pay $100,000 to the South Baltimore Community Land Trust, a local nonprofit, for an environmental project. And the Occupational Health and Safety Administration hit the company with a $121,000 fine for worker safety violations it said led up to the explosion.

But resident groups pushed back, many arguing that the penalties paled in comparison to the damage caused by the blast. Two Curtis Bay residents filed a class-action lawsuit against CSX. The company agreed to a $1.75 million settlement with those who lived or owned land in the community at the time and were able to join the class by July 18. The case awaits approval by a U.S. District Court judge.

Meanwhile, MDE joined an array of local organizations — including the Johns Hopkins Bloomberg School of Public Health, the University of Maryland and the Community of Curtis Bay Association — over a course of months last year in conducting a scientific study of pollution in the surrounding area.

The study found, among other things, that coal dust is present throughout the community, that it “finds its way into the community on a day-to-day basis and is correlated with both activity at the coal terminal and wind direction,” and that “the Curtis Bay community is overburdened by air pollution, with the community sensor network measuring average particle pollution levels that are higher than at nearby MDE regulatory monitors.”

The study led to protests by Curtis Bay residents and environmental advocates calling for MDE to deny CSX’s application for a renewal of its five-year air quality permit.

CSX hired analysts to evaluate the study, and they found it “flawed,” arguing in part that it tested for indicators of coal dust, rather than coal dust itself. The analysts’ report for CSX “indicates the community is in attainment with the U.S. Environmental Protection Agency National Ambient Air Quality Standards” for particulate matter, Bowman wrote after the 112-page report was published.

Still, MDE’s Hoagland said its findings influenced the conditions the state agency laid out in the draft permit.

And MDE Secretary Serena McIlwain said the agency is focused on making sure any permit benefits the community.

“We have been listening to the residents and will continue to seek their input before making a final decision,” she said in a statement. “We are committed to environmental justice for Curtis Bay and communities across Maryland. As with any permit application, our priorities are to protect the environment and public health.”

David Jones, a board member of the Curtis Bay community group, said Thursday that many members were discussing the details of the proposed permit, and that some of those who took part in the protests sounded happy the state was requiring CSX to make some changes.

“They’re saying we’re at least part of the conversation now, and that it’s better than not getting anything,” Jones said.

But Jones, 44, who grew up in Curtis Bay and has lived there for 35 years, wasn’t buying that argument. He believes the MDE should have denied CSX the permit outright and said experience has taught him to question whether the company would even comply with the new terms even if it signed on to them.

Entities found in noncompliance with legal agreements made with MDE face a fine of $25,000 per day per violation, said Hoagland, adding the agency can sue for the money in civil court.

But Jones said such penalties would be a “drop in the bucket” to a juggernaut like CSX that has been reaping profits from Curtis Bay for generations.

He’ll be making his voice heard at the Oct. 10 meeting, he said, but he fears the company has so much clout it won’t make a great deal of difference.

“I hope I’m wrong, but I think they’re going to continue to play their dirty game at the expense of this community,” he said. “At the end of the day, they know they can.”