AMES, Iowa – Aug. 24, 2026 – The Iowa Department of Transportation is now accepting grant applications across four eligible project categories for $7.6 million in funding through the Volkswagen Settlement Environmental Mitigation Trust funding program.
Private organizations, public transit system operators, cities, counties, and schools that own and operate diesel fleets and equipment in Iowa are eligible applicants for Category 1, 2, and 3 projects. Eligible projects include the replacement or repower of buses, freight trucks, and non-road transport and equipment. State agencies are not eligible for these categories, except for those that serve as public transit system operators for projects eligible under Category 1.
| Mitigation Category | Funding Available |
|---|---|
| Category 1 - Class 4-8 School Bus, Shuttle Bus, or Transit Bus | $4.1 million |
| Category 2 - Freight Trucks and Port Drayage Trucks | $1.2 million |
| Category 3 - Non-Road Transport and Equipment | $0.7 million |
For-profit businesses, incorporated non-profit organizations, government agencies of all types, and metropolitan or regional transportation planning organizations are all eligible applicants for projects that will install conveniently located and publicly accessible Level 2 Community Charging sites across the state. These electric vehicle charging equipment installations must meet the site and equipment requirements listed in the program guidance.
| Mitigation Category | Funding Available |
|---|---|
| Level 2 Community Charging sites | $1.6 million |
In 2016, the Environmental Protection Agency (EPA) filed a complaint alleging Volkswagen violated the Clean Air Act with the sale of motor vehicles between 2009 and 2016 equipped with “defeat devices” designed to perform differently during normal vehicle operation than during emissions tests. This meant that vehicles exceeded the EPA compliant levels of nitrogen oxides during normal use. Volkswagen agreed to settle some of the allegations with the creation of an Environmental Mitigation Trust (Trust) to fund strategies that will reduce the emission of nitrogen oxides. Iowa will receive approximately $23.5 million in Trust funds for mitigation projects which are being distributed through competitive application programs.
To learn more about these funding opportunities and how to apply, visit the program website at https://www.iowadot.gov/vwsettlement. Questions must be submitted in writing via email to [email protected]. Completed applications must be received by 5 p.m., Oct. 26, 2026.
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Contact: [email protected].