DENR Taking Public Comment on How to Spend VW Diesel Settlement thru June 15

Bob Mercer reports that the Department of Environment and Natural Resources is inviting public input on how to spend South Dakota’s $8,125,000 share of the $16.1 billion Volkswagen is coughing up in penance for rigging its diesel engines to beat emissions test.

My public input starts with the bottom line item in DENR’s plan for spending the money:

DENR’s proposal calls for:

• 50 percent to repower or replace large and medium local-freight trucks;
• 10 percent to repower or replace buses;
• 5 percent on zero-emission vehicle supply equipment;
• 25 percent for diesel-emission reduction (DERA) purposes, such as school-bus replacement or repowering; and
• 10 percent for administration [Bob Mercer, “State Board Sets Hearing on VW Diesel Settlement,” Mitchell Daily Republic, 2018.05.17].

Hold up: we’re getting $8,125,000, and its going to take $812,500 to manage the spending of that money? Um… can we bid that job out? Pay me a tenth of that, $81,250, and I’ll make all the calls, read all the brochures and engineering reports, sign all the contracts, and file all the receipts that it takes to buy all those new trucks and buses and electric engines, and I’ll get it all done in one year. Heck, at that salary, I won’t even ask for mileage and expenses.

DENR is being somewhat thrifty: apparently the settlement would allow recipients to use up to 15% of funds for administrative purposes:

The Department may use Trust funds for the following administrative expenditures, but not to exceed 15% of the Trust funds:

1. Personnel including costs of employee salaries and wages, but not consultants;
2. Fringe benefits including costs of employee fringe benefits such as health insurance, FICA, retirement, life insurance, and payroll taxes;
3. Travel including costs of Eligible Mitigation Action-related travel by program staff, but does not include consultant travel;
4. Supplies including tangible property purchased in support of the Mitigation Action that will be expensed on the Statement of Activities, such as educational publications, office supplies, etc. Identify general categories of supplies and their Mitigation Action costs;
5. Contractual including all contracted services and goods except for those charged under other categories such as supplies, construction, etc. Contracts for evaluation and consulting services and contracts with sub-recipient organizations are included;
6. Construction including costs associated with ordinary or normal rearrangement and alteration of facilities; and
7. Other costs including insurance, professional services, occupancy and equipment leases, printing and publication, training, indirect costs, and accounting.

The 15% cap includes the aggregated amount of eligible administrative expenditures incurred by the Department and any third-party contractor(s). The Department is proposing to use approximately 10% of the Trust funds for administrative expenditures. This percentage may change depending on the workload the Department actually experiences each year [DENR, “Volkswagen Beneficiary Mitigation Plan,” DRAFT, 2018.05.03, pp. 25–26].

Well, at least we’re not paying consultants.

DENR is taking written comments through June 15, via e-mail to environmental scientist Barb Regynski. Curious: does DENR plan to pay Regynski a bonus out of the VW settlement for the extra work she’s doing fielding all that public comment, or is DENR covering that administrative cost out of existing revenues?

DENR will also hold two public meetings next month:

• Wednesday, June 6: Best Western Ramkota Hotel & Conference Center, 2111 B N. LaCrosse, Rapid City, SD, from 6:00 PM MT to 9:00 PM MT.
• Tuesday, June 12: Ramada Hotel & Suites, 1301 W. Russell, Sioux Falls, SD, from 6:00 PM CT to 9:00 PM CT.

The Board of Minerals and Environment will also hold a public hearing on the VW diesel settlement on August 16.

Local Notes: I probably won’t see much of that Volkswagen money here in Aberdeen. The focus of the plan is to reduce the nitrogen oxide emissions that VW designed its emission systems to hide from testing. According to the DENR draft plan, there are 575 Volkswagen, Audis, and Porsches registered in South Dakota that are subject to the settlement, and Brown County isn’t among the top ten counties with those vehicles:

While Brown County is #4 for total nitrogen oxide emissions and #1 for emissions from “Non-Road Diesel Equipment”—i.e., tractors, construction equipment, and the like—Brown County doesn’t make the top ten for “On-Road Heavy Duty Diesel Vehicles”:

The DENR draft plan appears to focus on mitigating emissions from on-road diesel. Plus, Brown County is not in the top ten counties for nitrogen oxide emissions per square mile or per person, suggesting that mitigating emissions will have a greater impact on practical air quality in other counties.