Grants & Funding
State Grant Program
EPA's State Grant Program allocates funds to participating states to implement grant and loan programs for clean diesel projects. Base funding is distributed to states using a specific formula based on participation, and incentive funding is available for any states that match their base funding. Currently all 50 States and the District of Columbia are participating. EPA has developed a toolkit for state and local governments.
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Background
EPA allocates funding to the states through a formula outlined in the Energy Policy Act of 2005 (PDF) (551 pp, 1.3MB) 
. According to the Act, each state will receive one of two amounts, contingent on the provision of matching funds provided by the state.
The State Clean Diesel Program receives 30 percent of the annual DERA allocation funds. Two-thirds of the funds from the State Clean Diesel Program are provided to the participating states as base funding. The remaining third is awarded to states that provide matching funds. A match is not required for this program, but if a state matches the entire base amount dollar for dollar with cash or in-kind services, they will be awarded an additional amount equal to half of their base funding.
The match must be spent on eligible and allowable costs and is subject to the match provisions in the assistance agreement. Other federal funds cannot be used as a match. Any unclaimed funds will revert to the National Clean Diesel Funding Assistance Program.
Eligible Use of Funding
States may use their allocation to fund grant and loan programs for clean diesel projects that use:
- Retrofit technologies that are EPA or CARB-certified or verified
- Idle reduction technologies that are EPA-verified
- Technologies from EPA's Emerging Technologies List
- Early replacement and repower with certified engine configurations (incremental costs)
Funds cannot be used to support federal, state and/or local mandates.