Volkswagen Settlement

SCDOI as Lead State Agency

This web page has been created by the South Carolina Department of Insurance as the designated lead agency for administering South Carolina’s approximately $34 million allocation as a beneficiary under the Volkswagen Environmental Mitigation Trust.  

South Carolina is committed to an implementation process that is open and transparent.  This page is intended to share information regarding South Carolina’s approach to stakeholder outreach and use of mitigation funds available to South Carolina under the VW Environmental Mitigation Trust.  The SCDOI is updating this page as additional information and resources become available, so interested parties are encouraged to check back often for updates.

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Background Information:

In September 2015, following investigations by the U.S. Environmental Protection Agency (EPA) and the California Air Resources Board (CARB), Volkswagen (VW) officials admitted to installing "defeat devices" that were intended to cheat diesel emissions tests, resulting in emissions of nitrogen oxides (NOx) that were significantly in excess of compliant levels under the U.S. Clean Air Act and the California Health and Safety Code.

After an investigation and civil and criminal litigation, it was determined that these defeat devices had been installed in nearly 600,000 2.0 liter and 3.0 liter VW, Audi, and Porsche branded diesel vehicles sold in the U.S. beginning in 2009 (see list of impacted vehicles below).

The United States and California subsequently entered into a series of partial court settlements with VW to remedy the environmental and economic harm caused by the use of these defeat devices.  As a part of those settlements, Volkswagen is required to mitigate excess emissions through the establishment of an Environmental Mitigation Trust (Trust) totaling $2.925 billion.  The goal of the Trust is to offset the environmental damage caused by VW’s use of these defeat devices through NOx emissions reductions, primarily through the replacement of certain diesel engines or vehicles with cleaner diesel engines or engines using alternative fuel sources.

The $2.925 billion is allocated for the benefit of the 50 states, the District of Columbia, and Puerto Rico, collectively the beneficiaries under the Trust. South Carolina’s allocation is $33,895,491.39 allocation, which equates to 1.16% of the Trust.

On June 14, 2017, Governor Henry McMaster announced the South Carolina Department of Insurance as the lead agency in administering South Carolina’s approximately $34 million allocation. These funds must be used as outlined in Appendix D-2, Eligible Mitigation Actions and Mitigation Action Expenditures.

On October 2, 2017, the Court approved the Finalized Trust Agreement between the National Trustee (Wilmington Trust, N.A.), the United States, California, and Volkswagen. This established the Trust Effective Date.

The Trust requires each beneficiary to submit a Certification for Beneficiary Status Under Environmental Mitigation Trust Agreement (Appendix D-3). On November 21, 2017, the SCDOI filed the executed certification on behalf of the state. On January 29, 2018, Wilmington Trust officially designated South Carolina as a beneficiary under the Trust; the South Carolina Department of Insurance will serve as the lead agency for the State of South Carolina.

Beneficiary Mitigation Plan (BMP) On Wednesday, November 28, 2018, the South Carolina Department of Insurance released the state’s Beneficiary Mitigation Plan under the Volkswagen Environmental Mitigation Trust. The BMP details the state’s overall goal for the use of the funds and the categories of eligible mitigation actions the state anticipates to be appropriate to achieve these goals, among other things.

On Thursday, December 6, 2018, the South Carolina Department of Insurance released a revised Beneficiary Mitigation Plan with no substantive changes. This version only contains technical revisions to clarify that it is the final BMP for South Carolina.


Drafts of the Beneficiary Mitigation Plan (BMP) and Public Comments

• Document: Summary of Written Comments Received July 25 - August 24, 2018 on Second Draft Beneficiary Mitigation Plan (released 09/27/2018)
• Document: Second Draft Beneficiary Mitigation Plan (released 07/25/2018)
• Document: Summary of Written Comments Received April 10 - May 25, 2018 on Draft Beneficiary Mitigation Plan (released 07/17/18)
• Video: Recording of the May 1, 2018 Public Meeting (released 07/17/18)
• Document: Summary of May 1, 2018 Public Meeting (released 07/17/18)
• Document: Draft Beneficiary Mitigation Plan (released 04/10/18)
• Media Release: SCDOI Announces Release of VW Draft Beneficiary Mitigation Plan, Sets Public Meeting for May 1st (04/10/18)
  
  Resources:
• Document: National Trustee’s Notice of Beneficiary Designation (filed 01/29/18)
• Document: South Carolina’s Certification for Beneficiary Status (submitted 11/20/17)
• Document: Environmental Mitigation Trust Agreement for State Beneficiaries (as modified on 6/18/20)
• Document: Combined Allocations by Beneficiary for the Environmental Mitigation Trust (finalized on 10/02/17)
• Media Release: Gov. Henry McMaster Announces SC Department of Insurance as Lead Agency for VW Settlement Funds (06/14/17)
• Website: The National Trustee (Wilmington Trust) has established a website for public review of information related to the Environmental Mitigation Trust
• Website: EPA’s Volkswagen Clean Air Act Partial Settlement webpage
• Website: Volkswagen "Clean Diesel" Multi-District Litigation webpage
• Website: U.S. Department of Justice’s Volkswagen Settlement webpage
• Website: Volkswagen/Audi Buyback and Vehicle Modification website
• Website: SC DERA Program - The SC Department of Health and Environmental Control (DHEC) invites universities, private organizations, businesses, and any county, city, or other local government in SC to submit applications for the SC Clean Diesel Grant Program funded through the Diesel Emissions Reduction Act (DERA).

Eligible Mitigation Actions:

Eligible mitigation actions include replacing or re-powering diesel engines in the following vehicle or equipment categories:

• Class 8 local freight trucks and port drayage trucks;
• Class 4-8 school buses, shuttle buses, or transit buses;
• Freight-switcher locomotives;
• Ferry and tug boats;
• Shore power for ocean going vessels;
• Class 4-7 local freight trucks;
• Airport ground support equipment; and
• Forklifts and port cargo handling equipment.

In addition, beneficiaries may utilize up to 15% of their total allocation on costs relating to light duty zero emission vehicle (ZEV) supply equipment located in a public place, workplace, or multi-unit dwelling.  

Projects eligible under the Diesel Emission Reduction Act (DERA) program but that are not otherwise specifically included are eligible for funding.

Further Information

Appendix D-2, Eligible Mitigation Actions and Mitigation Action Expenditures under the Environmental Mitigation Trust Agreement

Impacted Vehicles: 

Affected diesel vehicle models and model years include: 

• Beetle (2013 – 2015)
• Beetle Convertible (2013-2015)
• Golf (2010 – 2015)
• Golf SportWagen (2015)
• Jetta (2009 - 2015)
• Jetta SportWagen  (2009 - 2014)
• Passat (2012 - 2015)
• Audi A3 (2010 - 2013; 2015)

Affected 3.0 liter diesel vehicle models and model years include:

• Touareg (2009 - 2016)
• Audi A6 Quattro (2014 - 2016)
• Audi A7 Quattro (2014 - 2016)
• Audi A8/A8L (2014 - 2016)
• Audi Q5 (2014 - 2016)
• Audi Q7 (2009 - 2015)
• Porsche Cayenne (2013 - 2016)

For more information:
Click here to go to the official Volkswagen modification and buyback website.

Contact us:

 Email: vwsettlement@doi.sc.gov
Call: 803-737-2420
Online: vwsettlement.sc.gov    

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