By MICHELE F. MIHALJEVICH

Indiana Correspondent

INDIANAPOLIS, Ind. — The Indiana Department of Environmental Management (IDEM) is seeking the public’s input on a plan to disburse funds from a settlement with Volkswagen regarding diesel emissions from its vehicles.

The settlement came after Volkswagen was found to have developed 2.0- and 3.0-liter vehicles in 2009-16 with computer algorithms that caused their emission control systems to perform differently during normal operation than they did during emissions testing, said Shawn Seals, senior environmental manager for IDEM’s office of air quality.

These algorithms, often referred to as the “defeat device,” resulted in excess nitrogen oxide (NOx) emissions beyond the U.S. EPA’s certified limits, he said. The Environmental Mitigation Trust was created as a part of the settlement.

Volkswagen will put $14.7 billion into the trust – $10 billion to buy back or modify affected vehicles and $2 billion toward a Zero Emission Vehicle (battery electric vehicles, plug-in hybrid electric vehicles or fuel cell vehicles) investment to be administered by the company. The remaining $2.7 billion will go to states for their trust funds.

The money will be allocated based on the number of affected vehicles in each state. Indiana’s share of the trust is about $41 million. The funds are to be used to buy back or modify affected vehicles and to support state and national projects to reduce NOx emissions, Seals said. The money can be used for projects for no fewer than three years and no more than 10 years.

The state’s Volkswagen Environmental Mitigation Trust Fund Committee has created a framework Beneficiary Mitigation Plan (BMP). IDEM wants the public’s feedback through March on the draft proposal.

“We call it a framework repeatedly because it’s very general and it’s very general on purpose,” Seals explained. “We want the folks of Indiana to tell us what makes the most sense for Indiana to include in this mitigation plan.”

IDEM wants the public’s thoughts on all aspects of the draft BMP, including the types of projects the trust fund committee should approve. The agency also wants feedback on the level of funding percentages for public and private entities.

The majority of the eligible project types are either diesel engine or diesel vehicle replacements, Seals said.

The agreement with Volkswagen lists a number of eligible mitigation projects including Class 8 local freight trucks and port drayage trucks; class 4-8 school, shuttle and transit buses; classes 4-7 local trucks; freight switcher (2,000 hp or less) locomotives; and airport ground support equipment. Model years 1992-2009 are eligible.

There’s also the option to use the Diesel Emissions Reduction Act (DERA) for some projects not identified in the mitigation trust.

“The mitigation trust is very specific about what you can do,” Seals pointed out. “DERA provides a greater level of flexibility. What we could do is overmatch our DERA grants and use some of these Volkswagen funds to do things like reduced idling projects or some other types of projects that wouldn’t be eligible under Volkswagen.”

IDEM has public meetings scheduled for Evansville on Feb. 13, Fort Wayne on Feb. 21 and Seymour on Feb. 26. Seals said he will also be making presentations in March. The sessions allow for questions and comments.

During a Jan. 30 meeting in Indianapolis, Katie Robinson, the city’s director of the office of sustainability, said city officials believe local governments are best positioned to implement trust-funded projects in vulnerable communities within their jurisdictions.

“Local governments can be comprehensive in their approach to address community needs,” she said. “Local governments have an existing framework capacity and demonstrated experience in serving their community and uplifting vulnerable people.”

City officials recommend funding should be distributed based on the values of transportation-related emissions and the size of vulnerable populations, Robinson said. The number of registered offending vehicles and air quality that indicates a disproportionate amount of pollution should also be considered.

The trust fund committee should think about the health of the approximately 660,000 Hoosier children who ride buses to school, said Steve Darnell, superintendent with Southern Wells Community Schools.

“They’re subject to those emissions from those diesel school buses,” he noted. “I would like the committee to consider replacing our diesel buses with electric buses. It would completely 100 percent remove those emissions, take that allergen, that stimulant, away from children that they face in the morning and after school is out.”

Brad Baughn, director of regulatory and legislative affairs for the Indiana Propane Gas Assoc. touted the benefits of propane for repowering and replacing diesel-powered vehicles and engines.

“Funds from the settlement toward propane auto gas would have a significant impact in reducing NOx emissions,” he said. “The use of propane has seen significant benefits in success in school buses and the replacement and repowering of other eligible vehicles such as forklifts and airport ground equipment.”

Propane is in abundant supply in the United States and most of it is exported, Baughn said. If U.S. propane markets were expanded, “we would be able to keep that American energy here in the U.S.”

To view the framework BMP, visit www.in.gov/idem/airquality/2712.htm and to make a comment, email VWTrust@idem.IN.gov