THEVWSETTLEMENTHANDBOOK:

Overview,Timeline,andActionsforAdvocates

1

TableofContents:

WhatistheVWSettlement?........................................................................................................................2

WhyDoWeCareAboutNOxandTransportation?......................................................................................3

TheEnvironmentalMitigationTrust............................................................................................................4

3ThingsYouCanDoToInfluencetheEnvironmentalMitigationTrustFunding.........................................5

VWSettlementandActionTimelines..........................................................................................................6

TABLES&APPENDICES.................................................................................................................................7

Table1–InitialEnvironmentalMitigationTrustFundAllocation............................................................8

APPENDIX1–TemplateLettertotheStateGovernor...........................................................................10

APPENDIX2–TemplateLettertoStateOrganizationsandAgencies....................................................12

APPENDIX3–Factsheets.......................................................................................................................14

2

WhatistheVWSettlement?

Fornearly500,000model2009–2016motorvehicles,Volkswagenknowinglyincorporatedcheatingcomputersystemsthatrunemissionscontrolsduringtesting,butdonotrunduringnormalvehicleoperation.1In2014,anindependentresearchstudyconductedbyWestVirginiaUniversityrevealedthattheemissionsfromVolkswagencarswere15–40timesabovetheU.S.EPAcompliancelevel.2InSeptember2015,theU.S.EPAfiledacomplaintagainstVolkswagen,3withotherpartiessoonfollowingsuit.

Inordertosettletheallegationsofcheatingemissions,Volkswagenagreedtospendupto$14.7billionforremediationofNOxemissions.Amajorityofthismoneyisgoingtovehiclebuybackandmodificationprograms($10.03billion),whichdirectlyrelatetoaffectedconsumers.ConsumershaduntilSeptember18th,2016toidentifyasan“eligibleowner”andthereforequalifyforthevehiclebuyback/modificationsprograms.

$4.7billionofthissettlementmoneyisgoingtowardsNOxreductionprograms:TheEnvironmentalMitigationTrust($2.7billion)andtheZEVInvestmentCommitment($2.0billion).Theremediationprogramstobefundedbythismoney,particularlyactionsfundedbytheEnvironmentalMitigationTrust,arestillbeingplannedandhavemanyopportunitiesforyourinput.

1https://www.epa.gov/vw/all-30-liter-diesel-engine-vehicles-affected2Thompson,G.,etal.(2015)In-UseEmissionsTestingofLight-DutyDieselVehiclesintheUnitedStates.CenterforAlternativeFuels,Engines&EmissionsWestVirginiaUniversity.3https://www.epa.gov/sites/production/files/2015-10/documents/vw-nov-caa-09-18-15.pdf

EnvironmentalMitigationTrust ZEVInvestmentCommitment

Amount

$2.7BillionØ Statespecificallocations

notedbelowinTable1

$2.0BillionØ $1.2billiontoU.S.Ø $800milliontoCalifornia

Purpose SupportprogramsandactionsthatreduceNOxemissions

Supportprogramsandactionsthatincreasetheuseofzeroemissionvehicle(ZEV)technologyintheU.S.

PlanDeveloper States’designatedagent/beneficiary(withinputfromthepublic) Volkswagen(withinputfromstates)

Administrator Trustee&States’designatedagent/beneficiary

U.S.EPA&CaliforniaAirResourcesBoard

3

WhyDoWeCareAboutNOxandTransportation?

Nitrogenoxides,referredtoas“NOx,”areprecursorstoozone(O3),whichisalsoreferredtoas“smog.”ThismeansthatwhenNOxareemittedfromsourcessuchasgas-fueledcars,thisprovidestheingredientsforozonetoform.

Asyoumayalreadybeaware,ozoneisapowerfulpollutantandhasdirectconsequencesonhumanandenvironmentalhealth.Peoplemostatriskfrombreathingaircontainingozoneincludepeoplewithasthma,children,olderadults,andpeoplewhoareactiveoutdoors,especiallyoutdoorworkers.4

EnvironmentalJustice

Whatyoumaynotbeawareof,however,isthatozonepollutionisparticularlyimportantforenvironmentaljusticepurposes.ThroughouttheUnitedStates,asairqualitydecreases,over-representationofpeopleofcolorincreases.Asthegraphdemonstrates,worseairqualitycorrelateswithgreaterproportionsofpeopleofcolor.

OpportunitytoDriveBigChange

ThetransportationsectorisoneofthelargestsourcesofNOxandothergreenhousegasemissionsintheUnitedStates.In2014alone,emissionsfromthetransportationsectoraccountedforoveronefourthofallgreenhousegasemissions.5ThefundingfromthissettlementcanbeusedtohelpelectrifythetransportationsectorineverystateoftheU.S.andeliminateoneofourbiggestsourcesofpollutioninthecountry.Notonlywillthisimprovehumanhealth,butitwillalsomitigateimpactsonclimatechangeandimproveenvironmentalhealth.

4https://www.epa.gov/ozone-pollution/ozone-basics#whatwherehow5https://www.epa.gov/ghgemissions/sources-greenhouse-gas-emissions

4

TheEnvironmentalMitigationTrust

YourgreatestareaofinfluencewilloccurwithdevelopmentoftheEnvironmentalMitigationTrust.Asanadvocateforcleantransportationandpublichealth,youcanensurethat(1)yourstatetakesactiontoreceivethefundingitiseligiblefor,and(2)usesthisfundingineffective,impactfulways.

Toassistyouwiththismission,wehaveincludedanoutlineofyouractionstepsonthefollowingpage,alongwiththenecessarytoolstosucceed.Theseinclude:

Ø Templatelettertoyourstategovernoridentifyingtheopportunitytoreceivefundsandencouraging

yourstatetodoso.Ø Templatelettertootheragenciesandorganizationsinformingthemaboutthisopportunity.Ø FactsheetsaboutpriorityareasoffundinginvestmentthatyoucanusetoadvocateforlowNOxand

ZEVprogramsthatyoubelievewouldbebestforyourstate:o ElectricVehicleInfrastructure–ifNOxemissionsfromlightweightvehiclesareoneofyour

state’smainsourcesofpollution,considerencouragingyourstatetorampupyourEVinfrastructure.ThisincludesbuildingEVchargingstations,andisagreatwaytoencourageconsumerstopurchasemoreelectricvehiclesinyourstate

o ElectricPorts–ifyouareastatewithlongcoastlinesandmanyports,transformingyourstate’sporttechnologytoelectricwillsignificantlyreducetheamountofNOxpollutioninyourstate’sair

o ElectricBuses–Ifyourstate’scitieshavepoorairquality,considerreplacingdieselbuseswithelectricbuses.Todaythetechnologyexistsforbusestotravel350milesbeforeneedingtorecharge,6tellyourstatethatthisisagreatopportunitytoinvestinacleanerschoolandpublictransportationsystem.

Ø Webinar–therewillbeawebinarwithanoverviewoftheVWSettlement,discussiononengagementopportunities,andchancesforyoutoaskanyquestionsyoumayhave.Thiswebinarwillberecordedandsharedifyoucannotmakethedateofthelivewebinar.YouwillalsobeabletocallintoaconferencelineandpagethroughaPowerPointpresentationifyouarenotcomfortablewiththewebinarformat.

o OpenHouseWebinar(allinterestedparties)–November4th,10:30amPT/1:30pmET

6Marshall,A.(2016)ThisNewElectricBusCanDrive250MilesOnOneCharge.https://www.wired.com/2016/09/new-electric-bus-can-drive-350-miles-one-charge/

5

3ThingsYouCanDoToInfluencetheEnvironmentalMitigationTrustFunding

¨ Sendalettertoyourstategovernor–assoonaspossible,reachouttoyourstategovernortoalerthim/heraboutthismulti-milliondollarfundingopportunityforyourstate.Thislettershouldtellthemabouttheirfunding,theirrequiredaction,andthedeadline.§ Atemplatelettertosendtoyourstategovernor,highlightingthefundingamountand

relevantdeadline,isavailableinthisdocument(Appendix1).§ Althoughthefinaldeadlinesarenotyetavailable,ifyourstatemissestheopportunityto

applyforitsportionoffunding,itwillbepermanentlyexcludedfromthefunding.§ Foreachstate’sfundingallocation,seeTable1.

¨ SendletterstostateagenciesandreachouttoyourfriendlysisterenvironmentalNGOs–assoonastheEnvironmentalMitigationTrustisfinalized(dateTBA),sendletterstoyourstate’sdepartmentofenvironmentalprotectionandotherenvironmentallyinterestedorganizationsandagencies.Thiswillincreasetheawarenessandpressure,ensuringyourstatetakesaction.§ Atemplateletterdescribingthefundingopportunityanddeadlineisavailable(Appendix2)

¨ Advocateforprojectfunding–overthenextcomingmonths,workwithyourstates’designatedbeneficiaryandotherinterestedorganizationstodirecttheflowoffundingtoareasthatwillbesthelpyourstatereduceitsdependenceonoilandtransitiontowardselectrictechnology.

Ideasofwhattoadvocatefor:

§ RampingupEVinfrastructureandpullingawayfromyourstate’srelianceonpetroleum*§ Upgradingyourstate’sportswithelectricporttechnology*§ Outfittingyourstate’spublictransitandschooltransportationsystemswithelectricbuses*§ Buildingoutgovernmentfleetswithelectricvehicles,especiallytrucks§ InvestinginNOxreductionprojectsthatalsosupportenvironmentaljustice

Ideasofwhattoadvocateagainst:

§ Dieseland/orAlternateFueled(e.g.CNG,propane,Hybrid)vehicleupgrades–althoughtheseoptionsareavailableforpartialfunding,electricupgradesareallocatedmoresettlementfundingandprovidegreaterNOxreductions*

*Factsheetsavailable–seeAppendix3

VWSettlementandActionTimelines

TheVolkswagenSettlementAgreementgainedpreliminarycourtapprovalonJune26th2016,anditisexpectedtobefinalizedmid-October.Once

finalized,knownastheSettlementAgreement“EffectiveDate,”or“ED,”theprocessofcreatinganEnvironmentalMitigationTrustwillbegin.

OncetheTrustisapproved,thedateofitsapprovalisthe“TrustEffectiveDate,”or“TED,”anditisthisdatethatwilldeterminethevarious

deadlinesbywhichstatesmustact.BelowistheanticipatedtimelineandrelativedeadlinesforStateandSierraClubChapteraction.

*Note*thatstatesonlyhave60daysfromthe“TrustEffectiveDate”tosubmittheirbeneficiarycertification,andstateshaveonly90daysfrom

whentheTrusteeapprovesthestate’sbeneficiariestosubmittheirBeneficiaryMitigationPlan.Inotherwords,ifyouwanttoinfluencehowthe

moneywillbespent,itwillbecriticaltoengageyourstatestartingimmediatelysincetheseeventsmaymovequickly.

TABLES&APPENDICES

8

Table1–InitialEnvironmentalMitigationTrustFundAllocation Initial Subaccounts Initial Allocation ($) Initial Allocation (%) Puerto Rico $7,500,000.00 0.28% North Dakota $7,500,000.00 0.28% Hawaii $7,500,000.00 0.28% South Dakota $7,500,000.00 0.28% Alaska $7,500,000.00 0.28% Wyoming $7,500,000.00 0.28% District of Columbia $7,500,000.00 0.28% Delaware $9,051,682.97 0.34% Mississippi $9,249,413.91 0.34% West Virginia $11,506,842.13 0.43% Nebraska $11,528,812.23 0.43% Montana $11,600,215.07 0.43% Rhode Island $13,495,136.57 0.50% Arkansas $13,951,016.23 0.52% Kansas $14,791,372.72 0.55% Idaho $16,246,892.13 0.60% New Mexico $16,900,502.73 0.63% Vermont $17,801,277.01 0.66% Louisiana $18,009,993.00 0.67% Kentucky $19,048,080.43 0.71% Oklahoma $19,086,528.11 0.71% Iowa $20,179,540.80 0.75% Maine $20,256,436.17 0.75% Nevada $22,255,715.66 0.82% Alabama $24,084,726.84 0.89% New Hampshire $29,544,297.76 1.09% South Carolina $31,636,950.19 1.17% Utah $32,356,471.11 1.20% Indiana $38,920,039.77 1.44% Missouri $39,084,815.55 1.45% Tennessee $42,407,793.83 1.57% Minnesota $43,638,119.67 1.62% Connecticut $51,635,237.63 1.91% Arizona $53,013,861.68 1.96% Georgia $58,105,433.35 2.15% Michigan $60,329,906.41 2.23% Colorado $61,307,576.05 2.27% Wisconsin $63,554,019.22 2.35%

9

New Jersey $65,328,105.14 2.42% Oregon $68,239,143.96 2.53% Massachusetts $69,074,007.92 2.56% Maryland $71,045,824.78 2.63% Ohio $71,419,316.56 2.65% North Carolina $87,177,373.87 3.23% Virginia $87,589,313.32 3.24% Illinois $97,701,053.83 3.62% Washington $103,957,041.03 3.85% Pennsylvania $110,740,310.73 4.10% New York $117,402,744.86 4.35% Florida $152,379,150.91 5.64% Texas $191,941,816.23 7.11% California $381,280,175.09 14.12% Tribal Allocation Subaccount $49,652,857.71 1.84% Trust Administration Cost Subaccount $27,000,000.00 1.00% Tribal Administration Cost Subaccount $993,057.15 0.04%

$2,700,000,000.02 100.00%

APPENDIX1–TemplateLettertotheStateGovernor

ThetemplateletteronthefollowingpagedescribesthesettlementandtheanticipateddeadlinesthattheOfficeoftheGovernorwillneedtomeet.Assoonaspossible,thislettershouldbecompletedwithyourstatespecificinformationandsenttoyourstategovernor.

11

[@DATE] The Honorable «GOVERNOR» Governor of «STATE» «ADDRESS_LINE_1» «ADDRESS_LINE_2» «CITY», «STATE» «ZIP» Dear Governor «GOVERNOR», On behalf of [Your Organization], I am writing to urge you to take advantage of the multi-million dollar funding opportunity available to «STATE» for the purpose of investing in electric vehicles and infrastructure. This money will flow from the Environmental Mitigation Trust, created by Volkswagen as part of the recent Volkswagen Settlement. The exact amount is subject to change until the settlement is finalized by the U.S. District Court for the Northern District of California, expected in late October. Taking advantage of this money will mean less money sent out of state for petroleum, more in-state jobs, better vehicles for your constituents, less carbon pollution, and cleaner, healthier air. In order for «STATE» to be given this funding, you, as our State Governor, must submit a certification that identifies a Lead Agency (“Beneficiary”), no later than 60 days after the Environmental Mitigation Trust Effective Date (“TED”). This is expected to take place in January 2017. If «STATE» fails to submit beneficiary certifications by this deadline, we will be permanently excluded from this funding. In addition, the beneficiary has no later than 90 days from the date of beneficiary designation to submit its plan to distribute this funding, consistent with the terms of the trust. This deadline is expected in the first half of 2017. We would very much like to assist in identifying elements of this plan that will help further improve our state’s public and environmental health. Please let us know the agency you identify as the beneficiary so that we may help promote this important work. Thank you for your attention and we encourage you to take swift preparatory action (i.e. compiling required beneficiary certifications now). If you have any questions or require any other information, please do not hesitate to contact us. Sincerely,

[SIGNATORY]

12

APPENDIX2–TemplateLettertoStateOrganizationsandAgenciesThetemplateletteronthefollowingpagedescribesthesettlementandtheanticipateddeadlinesthattheOfficeoftheGovernorwillneedtomeet,forthepurposeofinformingstateagenciesandotherenvironmentalNGOsinyourstate.Assoonaspossible,thislettershouldbecompletedwithyourstatespecificinformationandsenttoleadersintheseorganizations.

13

[@DATE] [FIRST NAME] [LAST NAME] [ADDRESS LINE 1] [ADDRESS LINE 2] [CITY], [STATE] [ZIP] Dear [SALUTATION] [LAST NAME], On behalf of the [YOUR ORGANIZATION], I am writing to ensure that you are aware of the multi-million-dollar funding opportunity now available to [STATE] for the purpose of investing in electric vehicles and infrastructure. This money will flow from the Environmental Mitigation Trust, created by Volkswagen as part of the recent Volkswagen Settlement. The exact amount is subject to change until the settlement is finalized by the U.S. District Court for the Northern District of California, expected in late October. Taking advantage of this money will mean less money sent out of state for petroleum, more in-state jobs, better vehicles for your constituents, less carbon pollution, and cleaner, healthier air. In order for our state to be given this funding, our state governor must submit a certification identifying a Lead Agency (“Beneficiary”), no later than 60 days after the Environmental Mitigation Trust Effective Date (“TED”). This is expected to take place in January 2017. If «STATE» fails to submit beneficiary certifications by this deadline, we will be permanently excluded from this funding. In addition, the beneficiary has no later than 90 days from the date of beneficiary designation to submit its plan to distribute this funding, consistent with the terms of the trust. This deadline is expected in the first half of 2017. Thank you for your attention and we hope you will support our governor taking swift action. If you have any questions or require any other information, please do not hesitate to contact us. Sincerely,

[@SIGNATORY]

14

APPENDIX3–Factsheets

WhenworkingwithagenciestodeveloptheMitigationPlanandtargetareasfortrustfunding,thefollowingfactsheetsareavailableforyouruse:

Ø BenefitsofElectricVehiclesvs.Diesel/AlternateFueledVehicles

Ø ElectricVehicleInfrastructure

Ø ElectricPorts

Ø ElectricBuses