Amendment ASA2-AB235

AB235-ASA2,3,7 (3) Exceptions. A penalty may be imposed notwithstanding sub. (2) if any of the following applies:

AB235-ASA2,3,10 (a) The information disclosed under sub. (2) is required to be reported under a specific permit, license or approval condition or under an order issued by the department.

AB235-ASA2,3,12 (b) The violation resulted in serious harm or in imminent and substantial endangerment to human health or the environment.

AB235-ASA2,3,20 (c) Within 3 years before the disclosure, the person making the disclosure has been found by a court or administrative law judge to have knowingly committed a criminal act or committed serious violations that constitute a pattern of continuous or repeated violations of environmental requirements, settlement agreements, consent orders or judicial orders that were due to separate and distinct events giving rise to the violations. In determining whether a person has a pattern of continuous or repeated violations under this paragraph, the trier of fact shall base the decision on the compliance history of the specific facility involved in the disclosure.

AB235-ASA2,3,22 (d) The violation resulted in a substantial economic benefit that gave the violator a clear advantage over its business competitors.

AB235-ASA2,3,23 (e) The violation is of an administrative or judicial order.

AB235-ASA2,4,4 (3m) Departmental response. If the conditions of a voluntary disclosure under sub. (2) (a) are not met but a good faith effort was made to voluntarily disclose and resolve a violation detected in an environmental audit, the department shall consider the nature and extent of any good faith effort in deciding the appropriate enforcement response and shall mitigate any civil penalties based on a showing that one or more of the conditions under sub. (2) (a) were met.

AB235-ASA2,4,7 (4) Criminal penalties. Immunity provided for in this section does not apply to any criminal penalties if the owner or operator of a site or facility recklessly or knowingly committed a criminal act.

AB235-ASA2,4,19 (5) Burden of proof. When the department commences an enforcement action against any person covered under sub. (2) for a violation of an environmental requirement based in whole or in part on information contained in an environmental audit and disclosed to the department, the disclosure shall be presumed to be voluntary. The person claiming that a disclosure is voluntary shall provide the supporting information required under sub. (2) (a), including information showing that an appropriate and good faith effort to achieve compliance has been undertaken with due diligence and that action was promptly taken to achieve compliance in the period of time since the date of the disclosure. The department has the burden of proving by a preponderance of the evidence that a penalty may be imposed because the disclosure was not voluntary, because any of the conditions under sub. (2) (a) were not met or because one of the exceptions under sub. (3) applies.

AB235-ASA2, s. 2 Section 2. 905.20 of the statutes is created to read:

AB235-ASA2,4,21 905.20 Environmental audit privilege. (1) Definitions. In this section:

AB235-ASA2,4,24 (a) "Environmental audit" means an evaluation of a site or facility or of an activity or management system related to a site or facility, if the evaluation meets all of the following criteria:

AB235-ASA2,4,25 1. Is conducted by or at the request of the owner or operator of the site or facility.

AB235-ASA2,5,2 2. Is not required under a specific permit, license or approval condition or under an order issued by the department of natural resources.

AB235-ASA2,5,6 3. Is undertaken for the purpose of identifying, documenting and improving compliance with environmental requirements, to identify an environmental hazard, contamination or other adverse environmental condition, or to improve an environmental management system or process.

AB235-ASA2,5,9 4. Is completed within a reasonable time after beginning the evaluation, but not to exceed 6 months after the notification under sub. (2) (b) is sent, unless an extension is granted by the department of natural resources.

AB235-ASA2,5,16 (am) "Environmental audit report" means a document or record or a set of documents or records, each labeled at the time of creation of the document or record, "environmental audit report: privileged document" and created as the result of an environmental audit and includes supporting information and an implementation plan that addresses, as appropriate, correcting past noncompliance, improving current compliance, improving an environmental management system and preventing future noncompliance.

AB235-ASA2,5,20 (b) "Environmental requirement" means a federal, state or local environmental law, including any rule, regulation, ordinance, permit, license, approval or special order issued under those laws. State environmental laws include chs. 160 and 280 to 299 and s. 166.20.

AB235-ASA2,6,2 (c) "Supporting information" means any collection of data or material in any format, including field notes, records of observations, findings, opinions, suggestions, conclusions, drafts, memoranda, reports, drawings, photographs and computer generated or electronically recorded data, maps, charts, graphs and surveys, if that data or material was created or prepared for the primary purpose and in the course of or as a result of an environmental audit.

AB235-ASA2,6,8 (2) General rule of privilege. (a) An owner or operator of a site or facility has a privilege to refuse to disclose and to prevent any other person from disclosing any environmental audit report related to the owner's or operator's site or facility. This privilege is in addition to any other privilege provided under this chapter. This privilege may be claimed in any civil action or administrative proceeding, including a contested case, as defined in s. 227.01 (3).

AB235-ASA2,6,15 (b) Prior to beginning an environmental audit, the person that requested the environmental audit shall notify the department of natural resources in writing of the date on which the environmental audit will begin, the site or facility or activity or management system related to a site or facility to be audited and the general scope of the environmental audit. The department of natural resources may not reveal to any person that the department has received a notice under this paragraph or the contents of any notice received under this paragraph.

AB235-ASA2,6,17 (c) Disclosure of any part of an environmental audit report to any of the following does not waive the privilege under this section:

AB235-ASA2,6,19 1. An employe, agent, successor, assignee, director or shareholder of the owner or operator of the site or facility.

AB235-ASA2,6,20 2. An attorney of the owner or operator of the site or facility.

AB235-ASA2,6,22 3. An independent contractor retained by the owner or operator of the site or facility to review an issue raised as a result of the environmental audit.

AB235-ASA2,6,25 4. A partner or lender of the owner or operator of the site or facility or a person whom the owner or operator is currently negotiating with regarding partnership, transfer of ownership or lending of money.

AB235-ASA2,7,2 5. A state or federal official or employe under the terms of an agreement between a state or federal agency and the owner or operator of the site or facility.

AB235-ASA2,7,4 6. The department of natural resources if the disclosure meets the conditions under s. 299.94 (2) (a).

AB235-ASA2,7,11 (3) Who may claim the privilege. (a) The privilege may be claimed by the owner or operator of the site or facility. If the owner or operator of the site or facility is a governmental unit, as defined in s. 939.648 (1), or a business entity, the privilege may be claimed by a director, officer, official, shareholder, trustee or managing employe, as defined in s. 49.498 (1) (e), or by any other employe. The authority to claim the privilege under this paragraph is presumed without evidence to the contrary.

AB235-ASA2,7,15 (b) Any person who may otherwise claim a privilege under par. (a) retains the right to claim the privilege in any civil or administrative proceeding, notwithstanding the use of an environmental audit in any proceeding under sub. (4) (c) 1., in which the privilege does not apply.

AB235-ASA2,7,21 (4) Exceptions. (a) The privilege does not apply if a court of record, after an in camera review of the environmental audit report, including a statement listing any activities undertaken as a result of the environmental audit to achieve compliance with environmental requirements, determines that the person seeking access to the environmental audit report proves by a preponderance of the evidence any of the following:

AB235-ASA2,7,22 1. That the privilege is asserted for a fraudulent purpose.

AB235-ASA2,8,4 2. That the owner or operator of the site or facility failed to take the appropriate responses necessary to achieve compliance within a reasonable time after any noncompliance was discovered as the result of an environmental audit, but not exceeding 3 years after the discovery. The department of natural resources may extend the time to achieve compliance beyond the 3-year limit in an order scheduling compliance if the department determines that acceptable progress is being made in achieving compliance.

AB235-ASA2,8,8 3. That the environmental audit report provides information about a site or facility that constitutes a violation of an environmental requirement and that the violation was committed with knowledge by an owner or operator of the site or facility that the site or facility violated an environmental requirement.

AB235-ASA2,8,9 (b) The privilege does not apply to any of the following:

AB235-ASA2,8,13 1. Documents, communication, data, reports or other information required to be made available or reported to a regulatory agency or any other person by statute, rule, ordinance, permit, license, approval, order or consent agreement, or as otherwise provided by law.

AB235-ASA2,8,16 2. Information obtained by the observation, sampling or monitoring conducted by a state or federal agency that regulates compliance with federal environmental requirements.

AB235-ASA2,8,18 3. Information legally obtained from a source independent of an environmental audit.

AB235-ASA2,8,19 (c) The privilege does not apply in any of the following:

AB235-ASA2,8,20 1. An action for contribution or indemnity under an insurance contract.

AB235-ASA2,8,21 2. A criminal investigation.

AB235-ASA2,8,23 (5) Penalties. A person who uses this section to commit fraud may be fined not more than $25,000.

AB235-ASA2, s. 3 Section 3. Nonstatutory provisions.

AB235-ASA2,9,6 (1) Within 5 years after the effective date of this subsection, the department of natural resources shall submit a report to the appropriate standing committees of the legislature, in the manner provided under section 13.172 (3) of the statutes, evaluating whether sections 299.94 and 905.20 of the statutes, as created by this act, have been effective in encouraging the use of environmental audits and in identifying and correcting environmental problems and conditions.

AB235-ASA2, s. 4 Section 4. Initial applicability.

AB235-ASA2,9,9 (1) This act first applies to environmental audits completed on the effective date of this subsection.

AB235-ASA2, s. 5 Section 5. Effective date.

AB235-ASA2,9,11 (1) This act takes effect on July 1, 1999.

AB235-ASA2,9,12 (End)