Governor Eric Holcomb is creating an 11-member committee to determine how to spend settlement money from Volkswagen.
Indiana received a nearly $41 million share in a court settlement with the German car-maker.
The money is supposed to go towards offsetting the effect of diesel emissions in Indiana after Volkswagen was caught using illegal software that allowed them to cheat on U.S. emissions tests.
The new committee, along with the Indiana Department of Environmental Management, is tasked with determining what specific projects will be taken on.
The agency will also hold public meetings to get input on how to spend the funds.