The Volkswagen settlement's nitrogen oxide mitigation trust

In late October, a federal district court in California formally approved a partial settlement between Volkswagen (VW) and the federal government and State of California concerning allegations that VW violated the Clean Air Act by selling nearly 500,000 diesel vehicles that were equipped with computer software designed to cheat on automotive emissions tests. Among other things, the partial settlement requires VW to pay $2.7 billion into an environmental mitigation trust that “is intended to fully mitigate the total, lifetime excess NOx [nitrogen oxide] emissions from the [affected] vehicles."

States should move quickly to familiarize themselves with the NOx portion of the VW settlement (i.e., Appendix D) and begin taking steps to consider and analyze the potential mitigation actions they can undertake with their anticipated NOx mitigation funds.

In this quick take, we will:

• Examine what the settlement means for States
• Discuss how States can maximize program effectiveness
• Provide guidance for implementing a NOx mitigation program that complies with the settlement terms