Volkswagen is footing the bill to replace or upgrade older, in-use vehicles and engines for freight trucks, switcher locomotives, ferries, tugboats and towboats.

The South Coast Air Quality Management District (South Coast AQMD) Governing Board has approved $26 million in statewide funding for the Combustion Freight and Marine Projects through the VW Environmental Mitigation Trust program.

The program is meant to fund projects in California that will fully mitigate excess nitrogen oxide (NOx) emissions caused by vehicles included in the statewide VW settlement.

This round of funding is the second statewide solicitation for this funding category under the VW Environmental Mitigation Trust program. The funding will provide the $26 million on a first-come, first-served basis to eligible projects to repower or replace older, in-use vehicles and equipment with the cleanest commercially available certified internal combustion or hybrid technologies including: replacement or upgrade of Class 7 and 8 freight trucks—including waste haulers, dump trucks, replacement of freight switcher locomotives or upgrade engines to Tier 4, and upgrade ferries tugboats or towboats to Tier 4 or hybrid with Tier 4-equivalent NOx emissions.

The new vehicles, equipment and engines funded through the program must be operated in the state for at least three years. Existing vehicles, equipment or engines being replace or upgraded are required to be scrapped.

The VW Environmental Mitigation Trust is a nationwide program that allocated $423 million to California to mitigate the excess NOx emissions caused by VW’s use of illegal emissions testing defeat devices in VW diesel vehicles.

The funding is also mean to target areas disproportionately impacted by air pollution and 50% of the funds from this category are expected to benefit disadvantaged or low-income communities.

Applications for the program will be accepted at http://www.aqmd.gov/vw/ starting June 22 at 1 p.m.