Previous legal proceedings
On Jan. 24, 2016, the United States and the State of California filed a lawsuit against Volkswagen alleging it had manufactured diesel cars with systems intended to defeat emissions tests. These systems allowed vehicles manufactured with 2.0 and 3.0 liter diesel engines to emit nitrogen oxide (NOx) pollution at levels that significantly exceeded the amounts allowed under the Clean Air Act.
On Oct. 25, 2016, a federal court approved a partial settlement of the lawsuit relating to 2.0 liter diesel cars. Later, on Dec. 20, 2016, the United States lodged a second partial settlement addressing vehicles with the 3.0 liter engines. An additional settlement has been filed resolving a criminal case but is not relevant to the terms of the settlement discussed here.
This portion of the settlement consists of three major parts: relief for owners and lessees of the Volkswagen and Audi brand noncompliant vehicles; a commitment by Volkswagen to spend $2 billion on various actions to promote the use of zero emission vehicles; and establishing an environmental mitigation fund to offset the impact from these vehicles’ excess emissions.
The mitigation fund will consist of $2.925 billion to be distributed among states based on the proportion of VW diesel vehicles registered in each jurisdiction. Under this formula Oregon is expected to receive about seventy three million dollars.
The settlement decree lists the specific actions states can for which states can use money from the mitigation fund. These actions focus on reducing NOx pollution from primarily diesel-powered trucks and buses. The types of approved actions include, generally, replacing older diesel-powered trucks, buses, industrial vehicles and other powered equipment with new, lower emissions equipment.
A number of steps must be completed before states can begin requesting environmental mitigation funds from the trust. The court must first grant final approval of the proposed settlement agreement. The court has selected a Trustee but must still approve the final trust terms. This is expected to occur in April 2017. When the court approves the final version of the trust, this is termed the “Trust Effective Date.” That date starts a timeline for states to take required actions to qualify to receive funds.
First each state must submit a certification form, signed by the governor, explaining how the state qualifies to be a beneficiary under the trust. If no one objects to a state’s request for certification, the trustee can grant the request.
Following this, each state must submit a mitigation plan. This is a high-level, summary description of the general measures the state intends to fund with the trust proceeds. Next, the states will solicit applications for fundable projects and then submit funding requests to the trustee.
An important part of this process is public participation and input. Since early fall 2016 DEQ has been soliciting input from stakeholders asking for input on funding priorities and project selection criteria.
Based on that input, DEQ is now proposing elements for the mitigation plan for public review and comment. After the close of the comment period, DEQ will consider changes to the draft plan that enhance meeting the overall goals. A further opportunity for review and comment on the plan before it is submitted to the trustee will be available once the state of Oregon is designated a Beneficiary, expected no sooner than 120 days after the trust effective date.
- Volkswagen has a web page with information for vehicle owners here: VW settlement page
- DEQ’s Vehicle Inspection Program has more information about what Volkswagen did and what vehicles are affected here: DEQ VIP information
- You can find information about Volkswagen’s actions, the settlement agreement and what vehicles are affected at the U.S. Environmental Protection Agency’s web site here: EPA general information
- The federal court handling the case has a web page with court documents and other information about the case here: Federal court VW page
- The U.S. Federal Trade Commission has a general information page about the Volkswagen case here: FTC VW general information
- The U.S. Department of Justice has information about the case here: US DOJ VW page