One billion gallons is about 10 billion pounds.
There was 140,000 pounds arsenic in 10 billion pounds of sludge.
Concentration of arsenic in sludge is 1.4 * 10e5 / 1e10 = 1.4 * 10e-5
Or about 1 part in 100,000.
This is why they got away with it. Coal ash sludge is nasty, but not quite nasty enough to be a hazardous substance per se. Hell, one of the best ways to get rid of it is to add it to concrete, which is then poured where people live.
The figure you should worry about is the change in the arsenic level in the river after the spill. I didn't see that figure in the article.