THE VOLKSWAGEN CLEAN AIR ACT
PARTIAL SETTLEMENT
Is your organization looking to improve air quality, reduce
operating costs, or increase available capital to buy electric
vehicles and equipment? Act now to prepare proposals for
funding from a $2.7 billion trust.
WHAT’S BEHIND THE VOLKSWAGEN CLEAN AIR
PARTIAL SETTLEMENT?
In October 2016, a federal judge approved the $14.7 billion
Volkswagen Clean Air Partial Settlement (the Settlement)
for the parties affected by the emissions cheating devices
found in 2.0-liter diesel engines, including vehicle owners,
lessees and states that must comply with the Clean Air Act.
Learn more about the Volkswagen settlement in this CNN
Money video. The Settlement, in part, requires Volkswagen
to invest an additional $2 billion to promote the use of zero
emission vehicles (ZEVs) and ZEV technology. The Settlement
also requires Volkswagen to fund a $2.7 billion trust (the
Mitigation Trust) to support environmental programs aimed
at remedying the excess emissions caused by the cheating
devices. In addition, a filing to add an additional $225 million
for emissions cheating devices in 3.0-liter diesel engines was
recently approved. This results in funding of nearly $3 billion
for the Mitigation Trust. Individual states will administer the
Mitigation Trust’s funds.
IS MY ORGANIZATION ELIGIBLE TO RECEIVE
FUNDING FROM THE MITIGATION TRUST?
Organizations, including but not limited to colleges and universities, municipalities, airports, mining companies, construction
companies, and manufacturers, are eligible to receive funding
from the Mitigation Trust for select mitigation actions aimed at
reducing ozone-related emissions. Eligible projects, which may
be funded up to 100%, include:
NonGovernment
Owned
Government
Owned
Eligible Mitigation Actions
Example Components
Construction equipment
(Class 8 vehicles); operations
& maintenance vehicles (Class
4-7 vehicles)
Repower with a new diesel or alternate-fueled engine (e.g., compressed natural
gas (CNG), propane, hybrid), including the costs of installation
40%
100%
New diesel or alternate-fueled vehicle (e.g., CNG, propane, hybrid)
25%
100%
Repower with a new all-electric engine, including the costs of installation and
charging infrastructure
75%
100%
New all-electric vehicles, including associated charging infrastructure
75%
100%
Repower with a new all-electric engine, including the costs of installation and
charging infrastructure
75%
100%
Repower with a new diesel or alternate-fueled engine (e.g., compressed natural
gas (CNG), propane, hybrid), including the costs of installation
40%
100%
New diesel or alternate-fueled vehicle (e.g., CNG, propane, hybrid)
25%
100%
Repower with a new all-electric engine, including the costs of installation and
charging infrastructure
75%
100%
New all-electric vehicles, including associated charging infrastructure
75%
100%
Acquisition, installation, operation and maintenance of new light-duty ZEV
supply equipment, including charging equipment, electric vehicle supply
equipment, and hydrogen fuel cell vehicle supply equipment
15%
15%
Ground support equipment*
(for airports):
New all-electric airport GSE, including charging infrastructure
Passenger transport: Class
4-8 school buses, shuttle
buses or transit buses**
Light duty ZEV supply
equipment***
*This does not include components covered under the ZEV Investment Commitment.
**Eligible shuttle buses include 2006 model year or older class 4-8 shuttle buses or transit buses.
***Light duty electric vehicle supply equipment includes Level 1, Level 2 or fast charging equipment (or analogous successor technologies) that is located in a public
place, workplace, or multi-unit dwelling and is not consumer light-duty electric vehicle supply equipment. Beneficiaries are only allowed to use 15% of funding
towards Light Duty ZEV Supply Equipment
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It is important to note that an existing vehicle engine must be
destroyed in order to secure funding for a new vehicle.
HOW DO I GET CONSIDERED FOR THE
MITIGATION TRUST FUNDING?
You can present a solid grant request if you follow some
key steps:
• Make your voice heard. Each state has the option to
decide what types of vehicles and equipment to cover.
Every state is taking a different approach to their mitigation plan, and some states have already prepared drafts.
Check your state government’s website for details on how
to submit public comments to ensure that your vehicles
are eligible for funding.
• Conduct a fleet vehicle inventory. Identifying which
vehicles are suitable for replacing, repowering, or converting to alternative fuels is an important first step.
During this step it is also important to consider emissions
modeling, operational performance, accurate data gathering, technical analysis, and cost estimating in order to
accurately identify the target fleet.
• Coordinate with your stakeholders. In order to analyze
and structure fleet management and replacement plans
you need to collaborate with your stakeholders, including
state and local air quality agencies, and maintenance and
facilities staff, among others.
• Evaluate your infrastructure needs. Identify the
infrastructure needed to support the use of alternatively
fueled vehicles on your property.
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• Prepare a cost estimation. Assemble and estimate
engineering, infrastructure, project management and
administrative costs associated with low- and zero-emissions vehicle projects.
As for timing, it is possible that grants from the Mitigation
Trust could be issued as soon as June 2017. While the
Settlement provides a schedule for the fund’s expenditure
from the Mitigation Trust, there is nothing to prevent grants
from being disbursed at a faster pace. You will be well served
to be the first in queue for Trust funding with well-defined and
fully documented projects.
HOW DO I GET STARTED?
While the pace and details of each program will vary from
state to state, time is of the essence—and Haley & Aldrich can
assist you. Prior to submission, we can help you conduct the
extensive coordination needed with stakeholders (including the
Trustee), and develop the required detailed project definition
and description of local community benefits and the emissions
reductions associated with the project.
In addition, we can work with your stakeholders to conduct
a fleet vehicle inventory, evaluate your infrastructure needs,
prepare a cost estimation, and help get your organization to the
top of the queue for Trust funding. Act now to be considered for
this one-time opportunity for capital funding.
To learn more about starting your grant
submission, contact Darcy Zarubiak at
[email protected] or 214.551.7651.