SENATE BUDGET AND APPROPRIATIONS COMMITTEE

 

STATEMENT TO

 

[First Reprint]

SENATE, No. 3029

 

with committee amendments

 

STATE OF NEW JERSEY

 

DATED:  JUNE 1, 2017

 

      The Senate Budget and Appropriations Committee reports favorably Senate Bill No. 3029 (1R), with committee amendments.

      As amended, this bill establishes the “Volkswagen Settlement Utilization Fund for Motor Vehicle Emissions Reduction and Air Pollution Control,” and directs the Department of Environmental Protection to use money credited to the fund to establish and implement certain air pollution control programs. 

      Under the bill, the “Volkswagen Settlement Utilization Fund for Motor Vehicle Emissions Reduction and Air Pollution Control” is established as a special, nonlapsing fund in the department.  The bill requires the department to administer the fund, and to credit to the fund all money received by the State from any settlement between the United States Environmental Protection Agency and Volkswagen of America, Inc. or any other appropriate division of the Volkswagen company operating worldwide.    

      As amended, the bill directs the department to establish, and to use money credited to the fund to support, programs to:

      -- promote zero emission vehicle use and the development and construction of zero emission vehicle charging or filling infrastructure to support such use, including, but not limited to, educating the public on the importance and availability of zero emission vehicles and their use and subsidizing the installation of public and private charging or filling stations;

      -- reduce diesel emissions at the ports of Elizabeth and Newark, the ports in the South Jersey Port District, and other ports in southern New Jersey, by repowering or replacement of diesel-powered vehicles or cargo handling equipment operating in those port regions through the issuance of grants, loans, or a combination thereof, for (1) acquisition of advanced maritime emissions control system pollution control equipment at the ports, (2) incentives for the repowering or replacement of pre-2007 model year heavy duty diesel trucks delivering and picking up containers at the ports, (3) upgrades, repowering, or replacement of cargo handling equipment, including but not limited to cranes, at the ports to zero emission vehicles and equipment and (4) any other measures to reduce diesel emissions at the port regions;

      -- convert diesel-powered airport ground support equipment to electric-powered equipment; and

      -- otherwise reduce air pollution from motor vehicle emissions.

      The bill provides that no more than five percent of the money credited to the fund may be used to pay for administrative costs incurred by the department to implement the bill.  The bill requires that 15 percent of the monies received by the State from the settlement must be used for costs directly connected to the acquisition, installation, operation, and maintenance of infrastructure for charging or filling stations for zero emission vehicles that are cars or light duty trucks.

      The bill requires the department to adopt any rules and regulations necessary for the implementation of the bill.

 

COMMITTEE AMENDMENTS:

      The amendments add the provision that authorizes the Department of Environmental Protection to also use funds from the Volkswagen Settlement Utilization Fund for Motor Vehicle Emissions Reduction and Air Pollution Control in support of programs to convert diesel-powered airport ground support equipment to electric-powered equipment.

     

FISCAL IMPACT:

      The Office of Legislative Services determines that this bill could result in increased expenditures over several years by the Department of Environmental Protection equal to the amounts the State may receive from any settlement between the United States Environmental Protection Agency and Volkswagen Group.  The receipt of settlement funds is contingent upon the State electing to participate in the applicable agreements. 

      According to the department, the State is eligible to receive $72.2 million from two separate federal consent decrees settling claims against Volkswagen Group for affected vehicles with 2.0 liter ($65.3 million) and 3.0 liter ($6.9 million) diesel engines, respectively.  According to the United States Environmental Protection Agency, the 2.0 liter partial settlement received final court approval in October 2016 and the 3.0 liter partial settlement in May 2017.

      The settlement agreements restrict the use of settlement funds to certain projects with demonstrable reductions in NOx emissions from heavy duty diesel sources near population centers and charging infrastructure for light duty zero emission passenger vehicles.

      The bill does not specify an allocation of settlement funds among authorized purposes, except that 15 percent of collections (or $10.8 million of the currently anticipated $72.2 million) must be used for the acquisition, installation, operation, and maintenance of infrastructure for charging stations for zero emission vehicles that are cars or light duty trucks.   

      The bill permits the department to use up to five percent of settlement receipts (or $3.6 million of the currently anticipated $72.2 million) to administer the programs to be established in accordance with the bill.