LANSING, Mich. — State officials are committing one-fifth of Michigan’s Volkswagen (VW) settlement funds to electric and new diesel school buses.

Of the $64.8 million that the state is receiving in mitigation plan funds, nearly $13 million ($12,961,402.93) will go toward replacing aging diesel school buses with new diesel-powered, electric, or other alternative-fueled buses, according to the Michigan Volkswagen Settlement Beneficiary Mitigation Plan, released by the Michigan Department of Environmental Quality (MDEQ) on Oct. 29.

Gov. Rick Snyder designated the MDEQ as the lead agency to administer Michigan’s allocation of the trust.

The plan also states that, for non-government-owned school buses, funding recipients under contract with a school district can receive up to 25% of the cost of a new diesel or alternative-fueled school bus, and up to 50% of the cost of an electric school bus and charging station.

Funding amounts for government owned and privately-owned school buses under contract with a public school district will be up to 25% of the cost of a new diesel school bus, up to 40% of the cost of an alternative-fuel school bus, and up to 70% of the cost of a new electric school bus and charging station.

Up to $3 million will be allocated for electric school buses and charging stations. A maximum amount per bus and charging station may be applied.

Michigan’s Diesel Emissions Reduction Act program will continue to use state and federal funds instead of tapping state trust agreement funds to support projects, according to the mitigation plan.

The first funding opportunity is expected to occur in late 2018 and will focus on school bus replacement, according to a news release from the MDEQ. More funding opportunities will be available beginning in mid-2019 and will target all remaining project categories. Funding will continue in phases until the funds are expended. Michigan has up to 10 years from Oct. 2, 2017 to spend its allocation of the funds.

Eligible applicants include local, state, and federal government agencies; school districts; transit authorities; private businesses; metropolitan planning organizations; nonprofit organizations; and tribes.

The VW Environmental Mitigation Trust is providing states with a total of $2.9 billion for projects that reduce nitrogen oxide (NOx) emissions from large vehicles.

For more information on the plan for the settlement funds, go here.