The North Carolina Department of Environmental Quality (DEQ)’s Division of Air Quality is currently accepting public comment on the state’s Draft Phase 2 Mitigation Plan to invest $67 million in Volkswagen Settlement funds. The Draft Phase 2 plan focuses on efforts to reduce pollution impacts while incentivizing zero emission vehicles and outreach to under-resourced communities.

The funds represent North Carolina’s share of the $2.9 billion federal settlement with Volkswagen (VW) due to its misrepresentation of diesel emission standards in certain vehicles. The Division of Air Quality was designated as the lead agency to manage the project in 2017 by Governor Roy Cooper, and Wilmington Trust officially named North Carolina as a State Beneficiary in January 2018.

Phase 1 Awards were announced in 2020 and the competitive application process resulted in 116 proposals for two grant programs: the Diesel Bus and Vehicle Program and the Zero Emission Vehicle (ZEV) Infrastructure Program. The awards included $12.2 million for school bus replacements, $6.1 million for transit bus replacements, $4.2 million for on-road heavy duty equipment such as refuse haulers, dump trucks and debris trucks, and $3.4 million for zero-emission vehicles DC Fast Charge stations.

The NC Clean Energy Technology Center (NCCETC) partnered with the Division of Air Quality to host a series of public information sessions in July to explain the draft plan to those interested in receiving funds for eligible projects. The recordings and presentations from the public information meetings can be found online here. 

A series of in-person public information sessions will also be held for counties eligible in the Historically Under-Resourced Counties Outreach Program. Additional meeting dates, locations and times will be posted on the DEQ Volkswagen Program webpage.

The Historically Under-Resourced County Outreach Program is being developed by the DEQ to help counties that historically lack resources needed to effectively identify eligible vehicles for grant programs and submit quality applications. The DEQ’s Draft Phase 2 Mitigation Plan identifies 31 Historically Under-Resourced Counties eligible for maximum funding amounts allowed by the VW Mitigation Consent Decree.

Public agencies as well as public/private partnerships will be eligible for Phase 2 funding. The Draft Phase 2 VW Mitigation Plan currently allocates 80 percent of funding to the Diesel Bus & Vehicle Replacement Program and 15 percent for the ZEV Infrastructure program. Through the Diesel Bus & Vehicle Replacement Program, 40 percent of Phase 2 funding will go towards replacing school buses, 20 percent of funding will be eligible for transit bus replacements and another 20 percent will be eligible for clean heavy-duty equipment and vehicle replacements.

The DEQ’s ZEV Infrastructure program was designed to expand the state’s ZEV charging infrastructure network along priority designated corridors. Phase 2 proposes a dedicated allocation for light-duty charging projects and the DEQ plans to coordinate with the NC Department of Transportation to determine optimal locations for these EV charging stations for state fleet vehicles and attractions on state owned property.

“These funds from the VW Settlement represent an opportunity to advance clean and sustainable transportation in North Carolina,” said Heather Brutz, Finance & Operations Manager for NCCETC’s Clean Transportation program. “We encourage interested parties to read over the plan and submit comments on how this round of funding will be allocated.”

Comments on the Draft Phase 2 Mitigation Plan may be submitted online via Microsoft Forms or emailed to daq_NCVWGrants@ncdenr.gov. Voicemail comments will also be accepted at 919-707-8429.

All comments will be accepted until September 7, 2021 at 5 p.m.