VW DIESEL EMISSIONS MITIGATION SETTLEMENT

Below we have chronicled the history of the Volkswagen “Clean Diesel” emission scandal. You will read about how Volkswagen’s “Clean Diesel” campaign led them down the road of lying and cheating their customers and various governments emissions regulations. The VW group could never have guessed that a University of West Virginia experiment that was supposed to validate VW’s technology ended up exposing them. Many lawsuits followed and how the settlements have presented an opportunity for the advancement and adoption of electric school buses.

VOLKSWAGEN “CLEAN DIESEL” CAMPAIGN

The Volkswagen (VW) Diesel Emissions Environmental Mitigation Trust (State Trust) stems from the discovery that the carmaker (brands impacted are Volkswagen, Audi and Porsche) illegally installed software on its diesel cars that activated emission controls only when the cars detected that they were being tested for emissions compliance. In ordinary driving, the software allowed the engines to emit as much as 40 times the legal limit for nitrous oxides, violating state and federal Clean Air Acts and threatening public health.

LAWSUIT

A federal lawsuit was filed by the United States Department of Justice (DOJ) on behalf of the Environmental Protection Agency (EPA), the state of California (California Air Resource Board (CARB) and the California Attorney General (CA AG)) and the Federal Trade Commission (FTC) against the VW Group. There was also a class action lawsuit brought on behalf of vehicle owners/lessees, including former owners/lessees and vehicle dealers.

SETTLEMENT AGREEMENTS

In 2016, the VW Group entered into multiple settlement agreements to resolve these court actions which totaled approximately $14.7 billion in penalties.
The Wilmington Trust was designated the trustee for the distribution of the $2.925 Billion in funds to the individual states, D.C. and Puerto Rico. In order for each beneficiary to receive their allocation of the funds they were required to file a Certification Form (Appendix D-3). On January 29, 2018, the Wilmington Trust filed the Notice of Beneficiary Designation which certified that all of the states , D.C and Puerto Rico filed their Certification Forms with no objections making them official Beneficiaries under the State Trust.

FUNDS FOR SCHOOL BUSES

Appendix D-2 of the Environmental Mitigation Trust Agreement for State Beneficiaries Attachment A details the Eligible Mitigation Actions and Mitigation Action Expenditures. Section two (2) allows funds to be spend on Class 4-8 school buses, shuttle buses and transit bus.

For school buses to be eligible for replacement or repower must be model-year 2009 or older Type A, Type C or Type D, be powered by diesel and also weigh over 14,001 pounds gross vehicle weight rating (GVWR). Government- or public-school-owned buses, as well as privately owned buses under contract with a public-school district, are eligible to receive up to 100 percent funding. Nongovernment owned vehicles, meanwhile, can be funded at 25 to 75 percent, depending on the fuel type of the replacement bus or drivetrain. All vehicles being replaced must also be scrapped.

CNG, propane, electric or hybrid are listed as examples of acceptable alternative fuels. However, the only alternative fueling infrastructure that is eligible for funding is Electric Vehicle Service Equipment (EVSE).

Each state receives no less than $8 million, while $55 million is earmarked for Native American tribes. The funding can be spent over a 3- to 10-year period. Each state may also designate some of its funding for its individual Diesel Emissions Reduction Act (DERA) program, through which school bus replacement can also be funded. Below you can see how much each state allocated towards school bus replacement and how electric school buses are being deployed in that state.

Click on the links below to find out what each state did with their VW settlement funds in respect to purchasing electric school buses.