SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Compensating Losses to the 
Environment from Automobiles with Noxious Undisclosed Pollution Act of 
2016'' or the ``CLEANUP Act''.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) Administrator.--The term ``Administrator'' means the 
        Administrator of the Environmental Protection Agency.
            (2) Electric drive vehicle.--The term ``electric drive 
        vehicle'' means a vehicle that--
                    (A)(i) is--
                            (I) a light-duty vehicle (as defined in 
                        section 86.1803-01 of title 40, Code of Federal 
                        Regulations (as in effect on the date of 
                        enactment of this Act)) that draws motive power 
                        from a battery with a capacity of at least 4 
                        kilowatt-hours; or
                            (II) a heavy-duty vehicle (as defined in 
                        section 86.1803-01 of title 40, Code of Federal 
                        Regulations (as in effect on the date of 
                        enactment of this Act)) with a gross vehicle 
                        weight rating--
                                    (aa) greater than 8,500 pounds and 
                                less than 14,000 pounds that draws 
                                motive power from a battery with a 
                                capacity of at least 10 kilowatt-hours;
                                    (bb) greater than 14,000 pounds but 
                                less than 33,000 pounds that draws 
                                motive power from a battery with a 
                                capacity of at least 15 kilowatt-hours; 
                                or
                                    (cc) greater than 33,000 pounds 
                                that draws motive power from a battery 
                                with a capacity of at least 20 
                                kilowatt-hours; and
                    (ii) can be recharged from an external source of 
                electricity for motive power; or
                    (B) is a motor vehicle (as defined in section 216 
                of the Clean Air Act (42 U.S.C. 7550)) that draws 
                motive power from a fuel cell (as defined in section 
                803 of the Spark M. Matsunaga Hydrogen Act of 2005 (42 
                U.S.C. 16152)).
            (3) Eligible applicant.--The term ``eligible applicant'' 
        means--
                    (A) a State;
                    (B) an Indian tribe (as defined in section 4 of the 
                Indian Self-Determination and Education Assistance Act 
                (25 U.S.C. 450b));
                    (C) a unit of local government; or
                    (D) a group composed of not fewer than 2--
                            (i) States;
                            (ii) Indian tribes; or
                            (iii) units of local government.
            (4) Qualified electric drive vehicle infrastructure.--
                    (A) In general.--The term ``qualified electric 
                drive vehicle infrastructure'' means any equipment or 
                service that--
                            (i) supports the electric refueling needs 
                        of electric drive vehicles; and
                            (ii) serves smart grid functions (as 
                        defined in section 1306(d) the Energy 
                        Independence and Security Act of 2007 (42 
                        U.S.C. 17386)) that optimize the integration of 
                        electric drive vehicles into the electric grid.
                    (B) Inclusions.--The term ``qualified electric 
                drive vehicle infrastructure'' includes any equipment 
                or services described in subparagraph (A) that is 
                located in a public or private location, including--
                            (i) a street parking location;
                            (ii) a parking garage;
                            (iii) a parking lot;
                            (iv) a home;
                            (v) a gas station; and
                            (vi) a highway rest stop.
            (5) Secretary.--The term ``Secretary'' means the Secretary 
        of the Treasury.

SEC. 3. AVERAGE FUEL ECONOMY CREDITS OBTAINED BY REASON OF VIOLATION OF 
              LAW.

    (a) Denial of Credits.--Section 32903 of title 49, United States 
Code, is amended by adding at the end the following:
    ``(i) Denial of Credits Obtained by Reason of Violation of Law.--If 
the Secretary determines that a manufacturer has obtained credits under 
this section by reason of a practice that violates this title or title 
II of the Clean Air Act (42 U.S.C. 7521 et seq.), such credits shall 
not be available to the manufacturer.''.
    (b) Additional Civil Penalty.--Section 32912 of title 49, United 
States Code, is amended--
            (1) in subsection (c)(1)--
                    (A) in subparagraph (A), by striking ``of this 
                section'' and inserting ``or for each credit to be used 
                in calculating a civil penalty under subsection (f)''; 
                and
                    (B) in subparagraph (B), by inserting ``or each 
                credit, as the case may be'' before the period at the 
                end; and
            (2) by adding at the end the following:
    ``(f) Civil Penalty With Respect to Average Fuel Economy Credits 
Obtained by Reason of Violation of Law.--In addition to any other 
penalty under this title and except as provided under subsection (c), a 
manufacturer that obtains credits under section 32903 by reason of a 
practice that violates this title or title II of the Clean Air Act (42 
U.S.C. 7521 et seq.) is liable to the Government for a civil penalty in 
an amount equal to $5 multiplied by the number of such credits.''.

SEC. 4. AIR QUALITY RESTORATION TRUST FUND.

    (a) Establishment.--There is established in the Treasury of the 
United States a trust fund to be known as the ``Air Quality Restoration 
Trust Fund'' (referred to in this section as the ``Trust Fund''), 
consisting of--
            (1) such amounts as are deposited in the Trust Fund under 
        subsection (b); and
            (2) any interest on, and proceeds from, any investment made 
        under subsection (d).
    (b) Transfers.--The Secretary shall deposit in the Trust Fund an 
amount equal to all administrative and civil penalties or other 
payments paid to the Federal Government after the date of enactment of 
this Act in connection with any violation or alleged violation of title 
II of the Clean Air Act (42 U.S.C. 7521 et seq.).
    (c) Availability.--Amounts in the Trust Fund shall--
            (1) be available for expenditure to the extent and in the 
        amounts provided in advance by appropriation Acts solely for 
        making expenditures under subsection (f); and
            (2) remain available until expended, without fiscal year 
        limitation.
    (d) Investment.--Amounts in the Trust Fund shall be invested in 
accordance with section 9702 of title 31, United States Code.
    (e) Administration.--Not later than 180 days after the date of 
enactment of this Act, after providing notice and an opportunity for 
public comment, the Secretary, in consultation with the Administrator 
and the heads of any other relevant Federal agency, shall establish 
such procedures as the Secretary determines to be necessary to deposit 
amounts in, and expend amounts from, the Trust Fund pursuant to this 
section, including--
            (1) procedures to assess whether a project carried out 
        under subsection (f) achieves compliance with applicable 
        requirements, including procedures by which the Secretary may 
        determine whether an expenditure pursuant to the project 
        achieves compliance;
            (2) auditing requirements to ensure that amounts in the 
        Trust Fund are expended as intended; and
            (3) procedures for identification and allocation of funds 
        available to the Secretary under other provisions of law that 
        may be necessary to pay the administrative expenses directly 
        attributable to the management of the Trust Fund.
    (f) Use of Funds.--Amounts from the Trust Fund shall be available 
solely for making grants to eligible applicants to support projects 
that--
            (1) increase qualified electric drive vehicle 
        infrastructure;
            (2) retrofit school buses or heavy-duty fleets to reduce 
        air emissions significantly;
            (3) purchase hybrid or zero emissions school buses or 
        heavy-duty vehicles;
            (4) purchase electric drive vehicles for municipal fleets;
            (5) provide public health grants to help track, treat, and 
        reduce the number of air emissions-related illnesses, such as 
        asthma, cardiovascular disease, and lung cancer; or
            (6) provide grants for projects to improve air quality in 
        low-income communities.
Compensating Losses to the Environment from Automobiles with Noxious Undisclosed Pollution Act of 2016 or the CLEANUP Act This bill directs the Department of the Treasury to deny Corporate Average Fuel Economy (CAFE)credits to any automobile manufacturer that circumvents emission control requirements to obtain CAFE credits unlawfully. Manufacturers earn CAFE credits when the average fuel economy for a given annualfleet of vehicles exceeds the minimalrequiredCAFE standards. Additionally, the National Highway Traffic Safety Administration(NHTSA)is authorized to collect additional penalties from manufacturers that obtain CAFE credits unlawfully. The bill also establishes an Air Quality RestorationTrust Fund funded with deposits from penalties NHTSA collects from manufacturers under this bill. The fund must be used solely forproviding grants to support specific programs that restore and improve air quality.
CLEANUP Act