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PAG LIN
1 1 Section 1. NEW SECTION. 455H.1 TITLE.
1 2 This chapter shall be known and cited as the "Environmental
1 3 Audit Privilege and Immunity Act".
1 4 Sec. 2. NEW SECTION. 455H.2 FINDINGS AND DECLARATIONS.
1 5 The general assembly finds and declares that protection of
1 6 the environment is enhanced by the public's voluntary
1 7 compliance with environmental laws and that the public will
1 8 benefit from incentives to voluntarily identify and remedy
1 9 environmental compliance issues. It is further declared that
1 10 limited expansion of the protection against disclosure and
1 11 prosecution will encourage voluntary compliance and improve
1 12 environmental quality. The provisions of this chapter will
1 13 not inhibit the exercise of regulatory authority by those
1 14 persons entrusted with protecting the environment. Therefore,
1 15 an environmental audit privilege is provided to protect the
1 16 confidentiality of communication relating to voluntary
1 17 environmental audits and limited immunity is provided to
1 18 improve compliance with environmental laws.
1 19 Sec. 3. NEW SECTION. 455H.3 DEFINITIONS.
1 20 As used in this chapter:
1 21 1. "Department" means the department of natural resources.
1 22 2. "Environmental audit" means a voluntary, internal
1 23 evaluation of one or more facilities, processes, or activities
1 24 regulated under local, state, or federal environmental laws or
1 25 of a management system related to the facility, process, or
1 26 activity, that is designed to identify and prevent
1 27 noncompliance and improve compliance with local, state, or
1 28 federal environmental laws. An environmental audit may be
1 29 conducted by the owner or operator, by an employee of the
1 30 owner or operator, by an officer or director of the facility
1 31 or operation, by an independent contractor hired by the owner
1 32 or operator, or by the owner's or operator's attorney.
1 33 An environmental audit includes the environmental audit
1 34 report which is a set of documents containing information
1 35 generated and collected in the course of conducting an
2 1 environmental audit. The report includes, but is not limited
2 2 to, the report document itself, any supporting documents, file
2 3 notes and records of observations, samples, analytical
2 4 results, exhibits, findings, opinions, suggestions,
2 5 recommendations, conclusions, drafts, memoranda, drawings,
2 6 photographs, computer-generated or electronically recorded
2 7 information, maps, charts, graphs and surveys, implementation
2 8 plans, interviews, discussions, correspondence, and
2 9 communications related to the environmental audit, if the
2 10 information is collected and developed for the primary purpose
2 11 of conducting the environmental audit. An environmental audit
2 12 report may have any or all of the following components:
2 13 a. A report prepared by the auditor, which may include the
2 14 scope of the environmental audit, the information gained in
2 15 the environmental audit, conclusions, and recommendations,
2 16 together with exhibits and appendices.
2 17 b. Memoranda and documents analyzing portions or all of
2 18 the report and discussing implementation issues.
2 19 c. An implementation plan that addresses correcting past
2 20 noncompliance, improving current compliance, or preventing
2 21 future noncompliance.
2 22 d. Periodic updates documenting progress in completing the
2 23 implementation plan.
2 24 3. "Owner" or "operator" means the person or entity who
2 25 prepared or caused the environmental audit to be undertaken.
2 26 "Owner or operator" does not include a prospective purchaser
2 27 who caused the environmental audit to be undertaken.
2 28 Sec. 4. NEW SECTION. 455H.4 PRIVILEGE.
2 29 1. An environmental audit shall be privileged and shall
2 30 not be discoverable or admissible as evidence in any legal
2 31 action in any civil, criminal, or administrative proceeding,
2 32 or in response to a regulatory inspection or inquiry, except
2 33 as otherwise provided in this chapter.
2 34 2. A person who voluntarily conducts an environmental
2 35 audit, an officer or employee of the person conducting the
3 1 environmental audit, or an independent contractor hired by the
3 2 person to conduct the environmental audit shall not be
3 3 questioned or examined as to the environmental audit without
3 4 the consent of the person, or unless ordered to do so by a
3 5 court of record or administrative tribunal. This subsection
3 6 does not apply if the environmental audit is subject to an
3 7 exception under section 455H.7.
3 8 3. The privilege exists as a rebuttable presumption. A
3 9 party seeking disclosure of privileged material has the burden
3 10 to overcome the rebuttable presumption.
3 11 4. Failure to comply with review, disclosure, or use
3 12 prohibitions in this chapter shall be the basis for
3 13 suppression of any evidence arising or derived from the
3 14 unauthorized review, disclosure, or use. The party failing to
3 15 comply with this chapter shall have the burden of proving that
3 16 the proffered evidence did not arise and was not derived from
3 17 the unauthorized activity.
3 18 Sec. 5. NEW SECTION. 455H.5 WAIVER OF PRIVILEGE &endash;
3 19 DISCLOSURE &endash; ORDER.
3 20 1. The owner or operator may waive the privilege under
3 21 section 455H.4. The privilege cannot be waived except by or
3 22 with the consent of the owner or operator.
3 23 2. The environmental audit may be disclosed under any of
3 24 the following circumstances without waiving the privilege
3 25 under section 455H.4:
3 26 a. Results of an environmental audit or information
3 27 generated by the environmental audit may be disclosed to any
3 28 person employed by the owner or operator of the audited
3 29 facility or operation, any legal representative of the owner
3 30 or operator, or any independent contractor retained by the
3 31 owner or operator to address an issue or issues raised by the
3 32 environmental audit.
3 33 b. Under the terms of a confidentiality agreement between
3 34 the owner or operator of the facility or operation audited and
3 35 a potential purchaser of the operation or facility audited.
4 1 c. Under the terms of a confidentiality agreement between
4 2 governmental officials and the owner or operator of the
4 3 facility or operation audited.
4 4 d. To a lender.
4 5 e. To the United States environmental protection agency
4 6 upon the demand of the agency.
4 7 3. The existence of an environmental audit is subject to
4 8 disclosure in a civil, criminal, or administrative proceeding.
4 9 The party in possession of the environmental audit may assert
4 10 the privilege. The party in possession shall not be required
4 11 to provide the inquiring party with a copy of the
4 12 environmental audit.
4 13 4. The inquiring party may file, with the appropriate
4 14 court or administrative tribunal, a petition requesting an in
4 15 camera review on whether the environmental audit or portions
4 16 of the environmental audit are privileged or subject to
4 17 disclosure under this chapter. The inquiring party's failure
4 18 to file a petition under this subsection shall waive the
4 19 party's argument that the environmental audit is not
4 20 privileged.
4 21 5. The court or administrative tribunal shall issue an
4 22 order scheduling an in camera review, within forty-five days
4 23 of the filing of the petition.
4 24 6. After the in camera review, the court or
4 25 administrative tribunal shall issue an order directing whether
4 26 the information in the environmental audit is subject to
4 27 disclosure.
4 28 a. The order may require disclosure of material for which
4 29 the privilege is asserted, if the court or administrative
4 30 tribunal determines that the privilege is asserted for a
4 31 fraudulent purpose, the material is not subject to the
4 32 privilege, or the material, even if subject to the privilege,
4 33 shows evidence of noncompliance with local, state, or federal
4 34 environmental laws and appropriate efforts to achieve
4 35 compliance with local, state, or federal environmental laws
5 1 were not initiated and pursued with reasonable diligence upon
5 2 discovery of noncompliance, shows that violations of local,
5 3 state, or federal environmental laws were intentional, or
5 4 shows that violations of local, state, or federal
5 5 environmental laws resulted in substantial harm to the public
5 6 health or the environment. The court or administrative
5 7 tribunal may compel disclosure of only those portions of a
5 8 report relevant to the issue in dispute.
5 9 b. The order may restrict the distribution and review of
5 10 the environmental audit or parts of the environmental audit to
5 11 protect against unnecessary disclosure.
5 12 7. The parties may at any time stipulate to entry of an
5 13 order directing that specific information contained in an
5 14 environmental audit is or is not subject to the privilege
5 15 under section 455H.4.
5 16 Sec. 6. NEW SECTION. 455H.6 VIOLATION.
5 17 If a person, party, public entity, public employee, or
5 18 public official divulges or disseminates all or any part of
5 19 the information contained in an environmental audit in
5 20 violation of this chapter or of an order issued by a court or
5 21 administrative tribunal under section 455H.5, the person,
5 22 party, public entity, public employee, or public official is
5 23 liable for any damages caused by the divulgence or
5 24 dissemination of the information and incurred by the person
5 25 for whom the environmental audit was prepared. A violation of
5 26 this chapter shall also result in a civil penalty not to
5 27 exceed ten thousand dollars payable to the aggrieved party.
5 28 A person who violates this section shall be guilty of a
5 29 simple misdemeanor and may be found in contempt of a court by
5 30 a court of record.
5 31 If the environmental audit otherwise meets the requirements
5 32 of this chapter, a disclosure or dissemination in violation of
5 33 this chapter or of an order issued by a court or
5 34 administrative tribunal under section 455H.5 shall not
5 35 abrogate the privilege under section 455H.4.
6 1 This section shall not affect provisions providing
6 2 employees protection under the following federal provisions,
6 3 42 U.S.C. } 5851, 42 U.S.C. } 300j-9(i), 42 U.S.C. } 9610, 33
6 4 U.S.C. } 1367, 15 U.S.C. } 2622, 42 U.S.C. } 6971, and 42
6 5 U.S.C. } 7622, which provide protection against discriminatory
6 6 actions taken by employers against employees who report
6 7 environmental noncompliance.
6 8 Sec. 7. NEW SECTION. 455H.7 EXCEPTIONS.
6 9 The privilege under section 455H.4 shall not extend to any
6 10 of the following:
6 11 1. Documents, communications, data, reports, or other
6 12 information required to be collected, developed, maintained,
6 13 reported, or otherwise made available to a regulatory agency
6 14 pursuant to local, state, or federal environmental laws or
6 15 regulations. However, the privilege shall extend to any
6 16 observations, findings, opinions, suggestions, or conclusions
6 17 derived from the above by the person conducting the
6 18 environmental audit.
6 19 2. Information obtained by observation, sampling, or
6 20 monitoring by any regulatory agency.
6 21 3. Information obtained from a source independent of the
6 22 environmental audit.
6 23 Sec. 8. NEW SECTION. 455H.8 VOLUNTARY DISCLOSURE.
6 24 1. A person who makes a voluntary disclosure of an
6 25 environmental violation to the department is immune from any
6 26 administrative or civil penalty associated with the issues
6 27 disclosed and is immune from any criminal penalties for
6 28 negligent acts associated with the issues disclosed. The
6 29 person shall provide information supporting the claim that the
6 30 disclosure is voluntary at the time that the disclosure is
6 31 made to the department. The person creates a rebuttable
6 32 presumption that the disclosure is voluntary. To rebut the
6 33 presumption that a disclosure is voluntary, the department or
6 34 other party has the burden of proving that the disclosure was
6 35 not voluntary.
7 1 2. The disclosure of information is voluntary if both of
7 2 the following circumstances apply:
7 3 a. The disclosure arises out of an environmental audit and
7 4 relates to the privileged information.
7 5 b. The person making the disclosure uses reasonable
7 6 efforts to pursue compliance and corrects the noncompliance
7 7 within a reasonable period of time after completion of the
7 8 environmental audit. Where the evidence shows the
7 9 noncompliance is the failure to obtain a permit, reasonable
7 10 effort may be demonstrated by the submittal of a complete
7 11 permit application within a reasonable time. Disclosure of
7 12 information required to be reported by local, state, or
7 13 federal law is considered to be voluntary disclosure and the
7 14 immunity provisions in this section are applicable.
7 15 3. If a person is required to make a disclosure relating
7 16 to a specific issue under a specific permit condition or under
7 17 an order issued by the department, the disclosure is not
7 18 voluntary with respect to that issue.
7 19 4. Except as provided in this section, this section does
7 20 not affect the authority of the department to require any
7 21 action associated with the information disclosed in any
7 22 voluntary disclosure of an environmental violation.
7 23 5. Upon application to the department, the time period
7 24 within which a noncompliance item is corrected under
7 25 subsection 2 may be extended if it is not practical to correct
7 26 the noncompliance within a two-year period. The grant of an
7 27 extension by the department shall not be unreasonably
7 28 withheld. If the department denies an extension, the
7 29 department shall provide the requesting party with a written
7 30 explanation of the reasons for the denial. A request for de
7 31 novo review of the department's decision may be made to the
7 32 appropriate court.
7 33 Sec. 9. NEW SECTION. 455H.9 ABROGATION OF OTHER
7 34 PRIVILEGES.
7 35 This chapter shall not limit, waive, or abrogate the scope
8 1 or nature of any statutory or common law privilege, including
8 2 the work product doctrine, the attorney client privilege, and
8 3 the self-critical analysis privilege.
8 4 EXPLANATION
8 5 This bill creates the "Environmental Audit Privilege Act",
8 6 which protects disclosure of environmental audits and provides
8 7 immunity from penalties for actions which voluntarily disclose
8 8 the existence of an environmental violation. The bill finds
8 9 that the protection of the environment is enhanced by the
8 10 public's voluntary compliance with environmental laws and the
8 11 benefit to the public from incentives to voluntarily identify
8 12 and remedy environmental compliance issues.
8 13 The bill provides that an environmental audit is privileged
8 14 and not discoverable as evidence in any legal action.
8 15 Environmental audit is defined as a voluntary internal
8 16 evaluation designed to identify and prevent noncompliance with
8 17 local, state, or federal environmental laws and includes the
8 18 environmental audit report which contains documents and
8 19 information generated and collected in the course of
8 20 conducting an environmental audit. The audit privilege exists
8 21 as a rebuttable presumption. Failure to comply with the
8 22 review, disclosure, and use prohibitions in the bill is
8 23 considered the basis for suppression of any evidence arising
8 24 from or derived from the unauthorized review, disclosure, or
8 25 use of information.
8 26 The bill provides that the owner or operator may waive the
8 27 environmental audit privilege. It provides for disclosure of
8 28 the audit in limited circumstances without waiving the
8 29 privilege. A person who wishes to obtain audit information
8 30 may file a petition for in camera review. The court or
8 31 administrative tribunal is required to schedule an in camera
8 32 review within 45 days. The court or administrative tribunal
8 33 will issue an order directing whether the audit or portions of
8 34 the audit is subject to disclosure. The bill provides that an
8 35 audit may be disclosed if the privilege is asserted for a
9 1 fraudulent purpose, if the material is not subject to the
9 2 privilege, if appropriate efforts to achieve compliance with
9 3 local, state, or federal environmental laws were not initiated
9 4 and pursued with reasonable diligence, if violations were
9 5 intentional, or if violations resulted in substantial harm to
9 6 the public health or the environment.
9 7 The bill provides that any person or any party, public
9 8 entity, employee, or official who divulges or disseminates
9 9 information in violation of an order is liable for damages,
9 10 subject to a civil penalty of up to $10,000, is guilty of a
9 11 simple misdemeanor, and may be found in contempt of court.
9 12 The bill does not change employees' rights to disclose
9 13 violations without violating the chapter under federal
9 14 "whistleblower" provisions.
9 15 The bill allows for limited immunity for a voluntary
9 16 disclosure of an environmental violation by a person to the
9 17 department of natural resources. A person who voluntarily
9 18 discloses a violation is immune from administrative and civil
9 19 penalties and criminal penalties for negligence that are
9 20 associated with the issues disclosed.
9 21 Voluntary disclosure is limited to disclosure arising out
9 22 of an audit and the person makes reasonable efforts to pursue
9 23 compliance and correct the noncompliance within a reasonable
9 24 period of time after completion of the audit. A disclosure
9 25 which is required under a specific permit condition or under
9 26 an order issued by the department of natural resources is not
9 27 considered to be voluntary. The bill allows for the
9 28 department to issue a compliance extension. The bill does not
9 29 limit, waive, or abrogate any common-law privilege, including
9 30 the work product doctrine, attorney-client privilege, and the
9 31 self-critical analysis privilege.
9 32 LSB 1968HV 76
9 33 js/jj/8
Text: HF00419 Text: HF00421 Text: HF00400 - HF00499 Text: HF Index Bills and Amendments: General Index Bill History: General Index
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