Text: HSB00190 Text: HSB00192 Text: HSB00100 - HSB00199 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
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. This subsection does not apply if the
3 6 environmental audit is subject to an exception under section
3 7 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 environmental owner or operator of the
3 29 audited facility or operation, any legal representative of the
3 30 owner or operator, or any independent contractor retained by
3 31 the owner or operator to address an issue or issues raised by
3 32 the 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, a petition requesting an in camera review on whether
4 15 the environmental audit or portions of the environmental audit
4 16 are privileged or subject to disclosure under this chapter.
4 17 The inquiring party's failure to file a petition under this
4 18 subsection shall waive the party's argument that the
4 19 environmental audit is not privileged.
4 20 5. The court shall issue an order scheduling an in camera
4 21 review, within forty-five days of the filing of the petition.
4 22 6. After the in camera review, the court shall issue an
4 23 order directing whether the information in the environmental
4 24 audit is subject to disclosure.
4 25 a. The order may require disclosure of material for which
4 26 the privilege is asserted, if the court determines that the
4 27 privilege is asserted for a fraudulent purpose, the material
4 28 is not subject to the privilege, or the material, even if
4 29 subject to the privilege, shows evidence of noncompliance with
4 30 local, state, or federal environmental laws and appropriate
4 31 efforts to achieve compliance with local, state, or federal
4 32 environmental laws were not initiated and pursued with
4 33 reasonable diligence upon discovery of noncompliance. The
4 34 court may compel disclosure of only those portions of a report
4 35 relevant to the issue in dispute.
5 1 b. The order may restrict the distribution and review of
5 2 the environmental audit or parts of the environmental audit to
5 3 protect against unnecessary disclosure.
5 4 7. The parties may at any time stipulate to entry of an
5 5 order directing that specific information contained in an
5 6 environmental audit is or is not subject to the privilege
5 7 under section 455H.4.
5 8 Sec. 6. NEW SECTION. 455H.6 VIOLATION.
5 9 If a person, party, public entity, public employee, or
5 10 public official divulges or disseminates all or any part of
5 11 the information contained in an environmental audit in
5 12 violation of this chapter or of an order issued by a court
5 13 under section 455H.5, the person, party, public entity, public
5 14 employee, or public official is liable for any damages caused
5 15 by the divulgence or dissemination of the information and
5 16 incurred by the person for whom the environmental audit was
5 17 prepared. A violation of this chapter shall also result in a
5 18 civil penalty not to exceed ten thousand dollars payable to
5 19 the aggrieved party.
5 20 A person who violates this section shall be guilty of a
5 21 simple misdemeanor and may be found in contempt of a court by
5 22 a court of record.
5 23 If the environmental audit otherwise meets the requirements
5 24 of this chapter, a disclosure or dissemination in violation of
5 25 this chapter or of an order issued by a court under section
5 26 455H.5 shall not abrogate the privilege under section 455H.4.
5 27 This section shall not affect provisions providing
5 28 employees protection under the following federal provisions,
5 29 42 U.S.C. } 5851, 42 U.S.C. } 300j-9(i), 42 U.S.C. } 9610, 33
5 30 U.S.C. } 1367, 15 U.S.C. } 2622, 42 U.S.C. } 6971, and 42
5 31 U.S.C. } 7622, which provide protection against discriminatory
5 32 actions taken by employers against employees who report
5 33 environmental noncompliance.
5 34 Sec. 7. NEW SECTION. 455H.7 EXCEPTIONS.
5 35 The privilege under section 455H.4 shall not extend to any
6 1 of the following:
6 2 1. Documents, communications, data, reports, or other
6 3 information required to be collected, developed, maintained,
6 4 reported, or otherwise made available to a regulatory agency
6 5 pursuant to local, state, or federal environmental laws or
6 6 regulations. However, the privilege shall extend to any
6 7 observations, findings, opinions, suggestions, or conclusions
6 8 derived from the above by the person conducting the
6 9 environmental audit.
6 10 2. Information obtained by observation, sampling, or
6 11 monitoring by any regulatory agency.
6 12 3. Information obtained from a source independent of the
6 13 environmental audit.
6 14 Sec. 8. NEW SECTION. 455H.8 VOLUNTARY DISCLOSURE.
6 15 1. A person who makes a voluntary disclosure of an
6 16 environmental violation to the department is immune from any
6 17 administrative or civil penalty associated with the issues
6 18 disclosed and is immune from any criminal penalties for
6 19 negligent acts associated with the issues disclosed. The
6 20 person shall provide information supporting the claim that the
6 21 disclosure is voluntary at the time that the disclosure is
6 22 made to the department. The person creates a rebuttable
6 23 presumption that the disclosure is voluntary. To rebut the
6 24 presumption that a disclosure is voluntary, the department or
6 25 other party has the burden of proving that the disclosure was
6 26 not voluntary.
6 27 2. The disclosure of information is voluntary if both of
6 28 the following circumstances apply:
6 29 a. The disclosure arises out of an environmental audit.
6 30 b. The person making the disclosure uses reasonable
6 31 efforts to pursue compliance and corrects the noncompliance
6 32 within a reasonable period of time after completion of the
6 33 environmental audit. Where the evidence shows the
6 34 noncompliance is the failure to obtain a permit, reasonable
6 35 effort may be demonstrated by the submittal of a complete
7 1 permit application within a reasonable time. Disclosure of
7 2 information required to be reported by local, state, or
7 3 federal law is considered to be voluntary disclosure and the
7 4 immunity provisions in this section are applicable.
7 5 3. If a person is required to make a disclosure relating
7 6 to a specific issue under a specific permit condition or under
7 7 an order issued by the department, the disclosure is not
7 8 voluntary with respect to that issue.
7 9 4. Except as provided in this section, this section does
7 10 not affect the authority of the department to require any
7 11 action associated with the information disclosed in any
7 12 voluntary disclosure of an environmental violation.
7 13 5. Upon application to the department, the time period
7 14 within which a noncompliance item is corrected under
7 15 subsection 2 may be extended if it is not practical to correct
7 16 the noncompliance within a two-year period. The grant of an
7 17 extension by the department shall not be unreasonably
7 18 withheld. If the department denies an extension, the
7 19 department shall provide the requesting party with a written
7 20 explanation of the reasons for the denial. A request for de
7 21 novo review of the department's decision may be made to the
7 22 appropriate court.
7 23 Sec. 9. NEW SECTION. 455H.9 ABROGATION OF OTHER
7 24 PRIVILEGES.
7 25 This chapter shall not limit, waive, or abrogate the scope
7 26 or nature of any statutory or common law privilege, including
7 27 the work product doctrine, the attorney client privilege, and
7 28 the self-critical analysis privilege.
7 29 EXPLANATION
7 30 This bill creates the "Environmental Audit Privilege Act",
7 31 which protects disclosure of environmental audits and provides
7 32 immunity from penalties for actions which voluntarily disclose
7 33 the existence of an environmental violation. The bill finds
7 34 that the protection of the environment is enhanced by the
7 35 public's voluntary compliance with environmental laws and the
8 1 benefit to the public from incentives to voluntarily identify
8 2 and remedy environmental compliance issues.
8 3 The bill provides that an environmental audit is privileged
8 4 and not discoverable as evidence in any legal action.
8 5 Environmental audit is defined as a voluntary internal
8 6 evaluation designed to identify and prevent noncompliance with
8 7 local, state, or federal environmental laws and includes the
8 8 environmental audit report which contains documents and
8 9 information generated and collected in the course of
8 10 conducting an environmental audit. The audit privilege exists
8 11 as a rebuttable presumption. Failure to comply with the
8 12 review, disclosure, and use of prohibitions in the bill is
8 13 considered the basis for suppression of any evidence arising
8 14 from or derived from the unauthorized review, disclosure, or
8 15 use of information.
8 16 The bill provides that the owner or operator may waive the
8 17 environmental audit privilege. It provides for disclosure of
8 18 the audit in limited circumstances without waiving the
8 19 privilege. A person who wishes to obtain audit information
8 20 may file a petition for in camera review. The court is
8 21 required to schedule an in camera review within 45 days. The
8 22 court will issue an order directing whether the audit or
8 23 portions of the audit is subject to disclosure.
8 24 The bill provides that any person or any party, public
8 25 entity, employee, or official who divulges or disseminates
8 26 information in violation of an order is liable for damages,
8 27 subject to a civil penalty of up to $10,000, is guilty of a
8 28 simple misdemeanor, and may be found in contempt of court.
8 29 The bill does not change employees' rights to disclose
8 30 violations without violating the chapter under federal
8 31 "whistleblower" provisions.
8 32 The bill allows for limited immunity for a voluntary
8 33 disclosure of an environmental violation by a person to the
8 34 department of natural resources. A person who voluntarily
8 35 discloses a violation is immune from administrative and civil
9 1 penalties and criminal penalties for negligence that are
9 2 associated with the issues disclosed.
9 3 Voluntary disclosure is limited to disclosure arising out
9 4 of an audit and the person makes reasonable efforts to pursue
9 5 compliance and correct the noncompliance within a reasonable
9 6 period of time after completion of the audit. A disclosure
9 7 which is required under a specific permit condition or under
9 8 an order issued by the department of natural resources is not
9 9 considered to be voluntary. The bill allows for the
9 10 department to issue a compliance extension. The bill does not
9 11 limit, waive, or abrogate any common-law privilege, including
9 12 the work product doctrine, attorney-client privilege, and the
9 13 self-critical analysis privilege.
9 14 LSB 1968HC 76
9 15 js/jj/8
Text: HSB00190 Text: HSB00192 Text: HSB00100 - HSB00199 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
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