Murphy Admin Steals Half of Volkswagen Settlement for Budget

The Murphy Administration is taking $69 million of the $141 million the state will receive from settlements with Volkswagen involving air-pollution violations and cheating on emissions tests will go into the general fund for the state budget. This is funding that is supposed to be going to clean air initiatives, including electric vehicles programs.

“New Jersey is supposed to move forward with electric vehicles. Instead of helping to jumpstart our goals, the Murphy Administration is stealing $69 million, the entire state portion, of the Volkswagen settlement to balance the budget. Volkswagen is paying for the damage they did to communities by increasing and failing to report on air pollution. We received the settlement money because of Volkswagen’s pollution and it should all go toward mitigating those affects and cleaning New Jersey’s air. Instead, Murphy is letting the air our of our tired by taking the money for the general fund,” said Jeff Tittel, Director of the New Jersey Sierra Club. “The Governor campaigned against taking environmental settlement monies for plugging budget holes the way Christie did. Now, he’s doing so. This goes against the spirit of the constitutional amendment.”

New Jersey accepted $72 million settlement from the Volkswagen Mitigation Trust on top of the $69 million previously awarded by the Volkswagen Group of America. The funds settle allegations that Volkswagen “violated New Jersey’s clean air statutes and defrauded consumers by selling diesel vehicles equipped with “cheat” software that deactivated their on-board emission controls except during emissions testing.” The New Jersey Department of Environmental Protection (DEP) has been named lead agency in administering the funds. The state must submit a “Beneficiary Mitigation Plan” that explains how the funds will be used.

“We desperately need the $69 million that they want to divert to make our economy greener with electric vehicles. This could jumpstart our clean transportation system. We need to make sure that that funds go to the right places including to plug-ins and helping urban areas where air pollution is worst. This will help create jobs and move our state forward with an automobile that has zero emissions and decrease fossil fuels. The biggest source of air pollution and greenhouse gases in our state comes from automobiles, which is why we need to increase electric vehicles to clean our air. We need to install plug-in stations along with providing things like zip cars, ride shares, and taxis to encourage EV’s that everyone can afford,” said Jeff Tittel. “We should be using the entirety of the $141 million to move New Jersey forward on electric vehicles.”

Last Fall, New Jersey voters approved Ballot Question #2 to dedicate environmental settlement funds to environmental clean-ups. This will block future administrations from robbing the money meant for repairing, preserving, or restoring natural resources. In NJ, these resources are held in the Public Trust. If you spill chemicals and destroy them, you not only have to clean-up your mess, but also compensate the public for their loss. The ballot language is as follows:

9. There shall be credited annually to a special account in the General Fund an amount equivalent to the revenue annually derived from all settlements and judicial and administrative awards relating to natural resource damages collected by the State in connection with claims based on environmental contamination.

“The voters overwhelmingly decided that environmental settlement money such as that from the Volkswagen settlement should be used only for non-environmental purposes. Isn’t air pollution an environmental contaminate as well? The Murphy Administration is going against these wishes by taking half of the funds for plugging budget holes. Volkswagen illegally added air pollution, creating increased health impacts and climate impacts. The entirety of the settlement funds should be used to mitigate those affects by improving our air quality and reducing greenhouse gasses,” said Jeff Tittel. “Even if it we believed it was legal to take the funds, we would recommend against doing so because it hurts the people and environment of New Jersey.”

The Clean Energy Fund is being raided once again; this time by $136 million or even higher. This includes $80 million for NJ Transit, $50 million for lights in government buildings, $2 million to the BPU and $5 million to implement RGGI. This Fund is meant to support projects that make our homes more resilient such as weatherization, along with energy efficiency and green jobs. The DEP is also suffering from budget raids and money being redirected.

“The Clean Energy Fund has become the state’s ATM. Christie consistently used the money to balance the budget and the Murphy Administration is continuing that pattern. This has become a hidden energy tax on consumers. Instead of using this money for the environment and creating jobs, it is used to plug budget holes. On top of the clean energy fund raids, $80 million dollars are being diverted from the DEP. This is funding for important programs that would go towards cleaning up toxic sites, brownfield redevelopment, and watershed protection. This will have a real impact on the agency because by diverting those funds, they are not hiring enough staff for DEP to do its job,” said Jeff Tittel.

We should be using these funds for things such as promoting electric vehicles in New Jersey. We can electrify our ports, especially in urban areas, with electric busses to reduce air pollution in areas already highly affected. We can use electric vehicles for transportation in and around the ports including moving goods and containers. We can implement clean transportation programs so that our school children can ride in cleaner, quieter, and healthier school buses that are powered by electricity. This is especially important for children who live in urban areas already overburdened by air pollution. Electric busses will benefit all mass transit riders, as well as anyone living in the city where they run without released air toxins.

“Stealing half of the Volkswagen funds for plugging budget holes is wrong and unfair to the people of New Jersey. We need to take advantage of the full $141 million to create more in-state jobs, better vehicles, less carbon pollution, and cleaner, healthier air. We believe that these funds can ideally be used to move New Jersey forward with electric vehicles. We can see the benefits of clean air and clean jobs if we put this money to good use. We can build a state-wide network of charging stations, create green jobs, save people money on gas, and reduce air pollution,” said Jeff Tittel, Director of the New Jersey Sierra Club.