State Takes Steps to Tap into $72.2M Volkswagen Settlement

Money would be used to deploy charging infrastructure for electric cars, relieve air pollution from transportation sector

The state yesterday took a step to obtain $72.2 million to fund a variety of programs to curb emissions from the transportation sector, the biggest source of air pollution in New Jersey.

By a 27-7 vote, the Senate approved a bill (S-3029) that would allow the state to tap into its share of funds from a $1.2 billion court settlement with Volkswagen arising from the manufacturer’s admission that it installed software to cheat on emissions tests on millions of vehicles.

The legislation, sponsored by Sen. Bob Smith (D-Middlesex), lays out a framework indicating where money from the settlement will be spent, with at least 15 percent of the funds going to help build charging stations for electric cars and other zero-emission vehicles, such as hydrogen cars.

The bill, approved without debate, needs to be adopted and signed into law by October to be eligible for the settlement funds.

The proposal is strongly backed by environmental groups who view New Jersey as lagging other states in building the infrastructure to convince motorists to buy electric vehicles. With less than a thousand electric charging stations available statewide, motorists have been reluctant to buy the vehicles because of range anxiety — not knowing where or when they can recharge their cars.

The money from the settlement also will be used to reduce diesel emissions at the Port Authority of New York and New Jersey, as well as other ports in South Jersey. The money would be used to buy emissions-control equipment to reduce diesel pollution at the ports, a health problem many local residents have long sought addressed.

According to a fiscal estimate prepared by the Office of Legislative Services, the bill could result in increased expenditures over several years in the state Department of Environmental Protection equal to the amounts the state may receive from any settlement between the federal government and Volkswagen.

The receipt of settlement funds is contingent upon the state electing to participate in the applicable agreements, according to the OLS statement.

“This bill will help get electric vehicles moving,’’ said Jeff Tittel, director of the New Jersey Sierra Club. “We’d like to see more money for electric cars and more money for electric buses.’’

The Volkswagen scandal involved the company equipping vehicles, including a half-million in the U.S., with software to cheat on diesel-emission tests. The company faced both criminal and civil investigations stemming from the tests.

“The Volkswagen debacle was one of the largest cases of corporate malfeasance,’’ said Doug O’Malley, director of Environment New Jersey. “It is only appropriate that settlement funds support electrification efforts in the state, including public transit.’’