California Governor Jerry Brown is expected to sign a state budget that will include Volkswagen “dirty diesel” settlement funds to be directed to disadvantaged communities.

It’s part of the $2 billion settlement in which $800 million will go the California for VW’s Electrify America program supporting zero emission vehicle adoption and increasing charging and hydrogen fueling infrastructure. Of that $800 million, the U.S. division of the German automaker had proposed spending $120 million on more than 400 charging stations in California by 2019, but the proposal has been heavily criticized by automakers, charging station suppliers, and regulators.

California clean vehicle programs are being directed by legislators and the governor toward making air quality improvements in disadvantaged, low-income communities. These residents usually live near freeways packed with traffic and smog from heavy-duty trucks.

Automakers and charging station companies have complained that VW’s plan – which would have directed its charging stations to more than 400 highway and community chargers usually in high-traffic areas. Competitors had been hoping to set up their own charging stations and increase their sales presence in these areas.

Last month, the California Air Resources Board in a letter requested VW to “make every attempt” to invest 35 percent of the first 30-month investment cycle in disadvantaged communities. These communities have been disproportionately affected by air pollution, CARB said. VW’s plan had not included establishing presence in disadvantaged communities.

The bill was passed on Thursday by the state senate and assembly following CARB’s May suggested guidelines. CARB is being directed to “ensure to the maximum extent allowable” that at least 35 percent of investment funds go to low-income and disadvantaged communities. The Air Resources Board of directors will also have to approve all of VW’s plans at public hearings.

On Tuesday, Brown said he supported the budget package and is expected to sign the bill into law soon.

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VW’s Electrify America project didn’t respond to Automotive News’ request for comments.

Last month, the automaker did confirm it will be investing $2 billion in line with court-approved settlements overseen by the U.S. Environmental Protection Agency and California officials.

Last month’s letter from CARB to VW also asked for more details on potential future investment in hydrogen fuel cell infrastructure in California. CARB wants VW’s ZEV Investment Plan to address potential investment in hydrogen fueling stations over the 10-year period.

Automotive News