On January 24, 2016, the United States and the State of California filed a lawsuit against Volkswagen alleging it had manufactured diesel cars sold and operated in the U.S. beginning in 2009 with emission control systems intended to defeat emissions tests. These systems allowed vehicles to emit nitrogen oxide (NOx) pollution at levels that significantly exceeded the amounts allowed under the Clean Air Act.

Volkswagen agreed to settle these allegations. The first partial settlement, regarding the installation and use of emission testing defeat devices in 2.0 liter diesel vehicles, was approved by a federal court in California on October 25, 2016. On December 20, 2016 an agreement was reached in a second partial settlement regarding the installation and use of emission testing defeat devices in 3.0 liter diesel vehicles. The overall settlement consists of three major parts:

Buyback, Lease Termination, Vehicle Modification and Emissions Compliant Recall Program

Volkswagen was required to earmark about $11.2 billion ($10.033 billion from the first 2.0 L consent decree and $1.2 billion from the second 3.0 L consent decree) to buy back affected noncompliant vehicles, terminate leases early, or repair the vehicles by 2019 or 2020 depending on the make and model. Volkswagen administers this part of the settlement directly with affected vehicle owners.

Additional information is available at

National Zero-Emission Vehicle (ZEV) Investment Plan

Volkswagen was required to invest $2 billion ($800 million within California and $1.2 billion outside of California) in four 30-month investment cycles over 10 years in ZEV infrastructure, access, and awareness initiatives. The form of the Trust Agreement can be found in Appendix C of the first partial consent decree. This part of the settlement is administered by Volkswagen as a subsidiary named Electrify America, the U.S. EPA and California. For each cycle, project proposals are submitted to Electrify America, and Electrify America develops an investment plan to be reviewed and approved by the EPA. The first round of project proposals closed January 16, 2017. Electrify America is currently implementing the Cycle 1 National ZEV Investment Plan, the Cycle 1 California ZEV Investment Plan, and the Supplement to the California ZEV Investment Plan. Proposals for the third round are currently being accepted. The second round of project proposals closed March 2018. Additional information is available at

While AEA does not administer these funds, AEA is seeking information from interested parties to identify projects and partnering opportunities. Go to the "Contact us" tab to submit a contact form, send an email, or subscribe to the list serve to receive program related email updates..

Environmental Mitigation Trust

Volkswagen is required to fund an Environmental Mitigation Trust in the amount of $2.925 billion ($2.7 billion from the first 2.0 L consent decree and $225 million from the second 3.0 L consent decree) to be used to offset the lifetime excess air pollution emitted by the Volkswagen vehicles that violated the Clean Air Act. The form of the Trust Agreement can be found in AppendixD of the first partial consent decree. The fund is distributed among states, territories and federally-recognized tribes based on the proportion of affected VW diesel vehicles registered in each jurisdiction.


Tribal Allocation

Nearly $54.5 million of the Mitigation Trust were allocated to federally-recognized tribes nationwide. Tribes may submit funding requests annually. In order to apply for the VW Tribal allocation, Tribes must file to become Beneficiaries of the Trust. Beneficiary certification is due at the time of the first funding request.

The Institute for Tribal Environmental Professionals (ITEP) has been selected as the Technical Assistance Provider for tribes. To request ITEP assistance in accessing this funding opportunity, contact ITEP at .  AEA is also available to assist Tribes interested in accessing these funds for DERA-eligible projects.


State Allocation

In November 2017, the State filed the certification for beneficiary status with the Court and the Trustee. On January 29, 2018, Alaska was designated a Beneficiary of the Trust, with AEA identified as the Lead Agency to oversee how the funds will be distributed. In February 2018, as required by the terms of the Trust Agreement, AEA provided a Notice of Availability of Mitigation Action Funds to all federal agencies that have custody, control or management of land within or adjacent to Alaska.

Alaska was allocated $8.125 million dollars from the Environmental Mitigation Trust. All of the funds are to be disbursed within 10 years, with no more than one third disbursed in the first year or two-thirds disbursed in the first two years.

As a Beneficiary, Alaska is required to develop a Beneficiary Mitigation Plan that summarizes how the State allocation of mitigation funds will be distributed among the 10 Eligible Mitigation Actions (EMAs) to reduce NOx emissions in the most cost-effective manner, reduce public exposure, and promote the use of clean vehicle technologies. The Plan was developed through a public process, with multiple opportunities for public comment, and submitted to the Trustee in December 2018. AEA will request applications from stakeholders for eligible projects consistent with the Plan. AEA will submit funding requests for selected projects to the Trustee for approval. Projects may begin once the Trustee releases the funds.