Indiana is poised to receive $41 million, its share of a $2.7 billion settlement federal regulators reached with Volkswagen after it was learned the German automaker cheated emissions tests for over half a decade.

But just how the state plans to spend that money is a mystery thanks to what some contend is a process that thus far has been neither transparent nor open to public input.

In at least 38 states, residents can find information about the settlement on their government's website. In some cases, they may even be able to submit their own suggestions into whether the funds should be used for electric transit, hybrid vehicles, or any of the 10 ways the Environmental Protection Agency has identified to fight pollution.

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But Hoosiers who want a say in how Indiana spends its share of the pot might want to try to snag a meeting with the Indiana Department of Environmental Management's Commissioner Bruno Pigott.

"While other states have chosen to accept public comment in a web-based manner, Indiana has chosen to reach out to stakeholders in a more personal way with one-on-one meetings with interested parties and presenting on meeting agendas of interested parties," IDEM's Deputy Director of Communications Tara Wolf told IndyStar via email. "[Pigott] has been meeting one-on-one with many interested stakeholders since he came into office in January."

If that seems like Hoosier Hospitality to some, others see it as a series of closed-door talks outside of the public's view.

To be clear, there is no requirement for states to solicit public comment before the legal process to get the funds has begun. And Wolf assured that the time will come when Hoosiers can comment on a draft plan.

Still, some are concerned that Indiana is behind several states who have chosen to be proactive. Some states solicited public feedback as early as last fall, and a handful of states have already published drafts of their proposals online. Minnesota, for example, has received hundreds of comments and responses to an online survey and held more than a half dozen public meetings to discuss how the funds should be spent.

"We just thought it was the right thing to do," said Rocky Sisk, State Program Administrator for the Minnesota Pollution Control Agency. He said that many people have different perspectives on the issue, but that the meetings have been instrumental in shaping their plans.

"Those are the things we feel very confident about doing now that we've had public input," Sisk said.

Before states submit their plans, they'll have to take part in a legally technical process determined by the settlement. First, states will have to announce which agencies will manage the funds in their respective states. Many states have already done this, often choosing one of their environmental departments.

Indiana has not formally announced which agencies will handle the funds. According to those familiar with the issue, it could be a group of three to five agencies, and the general assumption is that IDEM will take the lead. IDEM's Wolf said that the Indiana agency handling the funds will be announced once the "trust effective date" is finalized, which will set deadlines for states to have their plans drafted. It's at that point that the state will ramp up its public outreach.

"A draft Beneficiary Mitigation Plan for public comment will be posted on our website and the public will have ample time to submit comments," Wolf said. IDEM would not disclose which groups or individuals the agency had met with, but Wolf said that it "has spoken to any group or individual who has requested information."

The money being paid to states by Volkswagen is one of a series of criminal and civil penalties levied against the automaker. The company was found to be in violation of the Clean Air Act when it came to light that Volkswagen had cheated on emissions testing of some of its diesel vehicles. About half a million cars in the U.S. were allowed to emit pollutants "at levels up to 40 times the standard" set by the EPA. Nitrogen oxides, or NOx gases, are a byproduct of burning diesel fuel and have the potential to cause asthma and other respiratory health issues. The mitigation trust fund is meant to address those NOx emissions.

At least one organization is not waiting on IDEM to start promoting its plan. This summer, the Environmental Law and Policy Center conducted an electric bus tour across four states where they hope settlement money could be used to replace diesel school buses with electric ones.

"Children are especially vulnerable [to diesel fumes] because their lungs are not yet developed, and the particles make their way through the nose, into the blood stream and cause all sorts of problem," said Susan Mudd, Senior Policy Advocate at ELPC, noting that more than half of public school children in Indiana are transported by bus.

Mudd has been impressed with efforts by other states in the region. She remarked on the several public meetings held in Minnesota, and the "priority county" map produced by Ohio's EPA.

"Indiana has not stepped forward yet, " Mudd said, "but we're hopeful."

Kellie Walsh, executive director of the Greater Indiana Clean Cities Coalition, said that when the mitigation trust fund was announced, her phone was ringing off the hook.

"Folks were like, 'When is money going to be on the street?'" said Walsh. "Sorry guys, that's not how this works."

Walsh's organization is part of a nationwide network established by the U.S. Department of Energy to help local governments and businesses implement alternative fuels and greener technologies. In Indiana, the program has helped secure more than $22 million in state and federal grants to help make the often major investment it takes to convert their company's vehicles.

"Fleets want to reduce emissions but if it doesn't make sense to them financially and the ROI (return on investment) isn't there, they aren't going to do it out of the goodness of their heart," she said.

Wolf said that there have been no decisions made about how the funds will be used, but Walsh thinks that at least some of the funds might go into the state's Dieselwise program, which retrofits old diesel vehicles to reduce harmful emissions. It's the state-level version of a national program to reduce diesel emissions, and one of the eligible uses for VW settlement money.

Walsh says that the Clean Cities Coalition doesn't favor any one alternative fuel or technology over others — as she puts it, "there's no one silver bullet, but there's a lot of silver BBs" — but she hopes the funds will be used to back a diverse selection of projects, which could translate into in considerable investments for her members.

"These dollars are a great mechanism for them to start a replacement plan that could potentially fund their entire fleet rollover to cleaner vehicles," she said.

Some of her stakeholders are anxious about who will get a shot at the funds in Indiana. Craig Moore, the Senior Vice president and COO of Kinetrex Energy, an Indiana-based liquid natural gas wholesaler, said that he was frustrated that Indiana had not publicly discussed a plan.

"The concern that I have is that I have not heard anything [from my customers]," said Moore. "We need to find mechanisms in the state of Indiana to ensure large fleets know about the dollars, because a lot of people don't even know the dollars exist."

Moore thinks that Indiana should be leading the charge for cleaner fuels, greener technology, and renewable energy. Companies based in Indiana, like Moore's Kinetrex Energy or Cummins, are already working on these kinds of solutions.

"Indiana could be driving the country towards sustainable fuels, and yet we don't have a plan to take dollars that are already allocated and get those into the hands of some major fleets that are already in the state of Indiana and help them with those conversions," said Moore.

"Our state needs to make these dollars a priority, we need a plan, and we need to make sure we're getting these dollars in the hands of the people that make these decisions."

Contact Emily Hopkins at (317) 444-6409 or emily.hopkins@indystar.com. IndyStar's environmental reporting project is made possible through the generous support of the nonprofit Nina Mason Pulliam Charitable Trust.