LRB-5648/1
RPN:kg:ch
1995 - 1996 LEGISLATURE
March 27, 1996 - Introduced by Representatives Green, Duff, Freese, Ott, Jensen,
Kreibich, Musser and
Porter, cosponsored by Senators Welch and
Huelsman. Referred to Committee on Judiciary.
AB1088,1,3
1An Act to create 144.994 and 905.20 of the statutes;
relating to: creating a
2privilege for environmental audits, providing immunity for disclosures related
3to environmental audits and providing a penalty.
Analysis by the Legislative Reference Bureau
This bill creates an immunity from the imposition of a civil or criminal penalty
in cases involving potential violations of an environmental requirement. The
immunity applies if a person voluntarily discloses the information related to the
potential violation promptly after the person knew of the potential violation, based
on information obtained in an environmental audit. In addition, the immunity
applies only if the person makes a good faith effort to correct the potential violation
and cooperates with the department of natural resources (DNR) in any investigation
related to the disclosure. The immunity does not apply in certain situations,
including when the information is required to be disclosed under a permit or order
issued by DNR.
The bill also establishes an environmental audit privilege, restricting the
disclosure of any information obtained as part of an environmental evaluation of a
site or facility. The privilege applies to audits that are conducted at the request of
the owner or operator of the site or facility and that are not required under a permit
or order issued by DNR. The bill provides that the privilege is not waived by
disclosure of the contents of an environmental audit to certain groups, including
directors and shareholders of the business entity that owns or operates the site or
facility, state or federal officials under the terms of a specific agreement or DNR if
the audit was voluntarily disclosed and conditions are met to provide immunity from
penalties. Under the bill, a court may determine that the privilege does not apply
if the privilege is asserted for fraudulent purposes, if timely action is not taken to
respond to any environmental noncompliance found in the audit or if the owner or
operator of a site or facility knew of an environmental violation disclosed during the
audit.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB1088, s. 1
1Section
1. 144.994 of the statutes is created to read:
AB1088,2,2
2144.994 Immunity for disclosures. (1) Definitions. In this section:
AB1088,2,33
(a) "Environmental audit" has the meaning given in s. 905.20 (1) (a).
AB1088,2,44
(b) "Environmental requirement" has the meaning given in s. 905.20 (1) (b).
AB1088,2,8
5(2) Disclosure immunity. (a) A person who voluntarily discloses information
6relating to a potential violation of an environmental requirement to the department
7shall be immune from the imposition of a civil or criminal penalty which may be
8imposed for the violation if all of the following apply:
AB1088,2,119
1. The disclosure is made promptly after the person knew, on the basis of
10information obtained during an environmental audit, that a potential violation
11occurred.
AB1088,2,1212
2. The person makes a good faith effort to timely correct the potential violation.
AB1088,2,1413
3. The person cooperates with any reasonable request by the department in any
14investigation that results from the disclosure.
AB1088,2,1915
(b) If the person who voluntarily discloses information under par. (a) is a
16governmental unit, as defined in s. 939.648 (1), or a business entity, the immunity
17under this subsection applies to a director, officer, official, shareholder, trustee and
18managing employe, as defined in s. 49.498 (1) (e), of that person and to an employe
19of that person if the employe consents in writing to the disclosure.
AB1088,2,21
20(3) Exceptions. A penalty may be imposed notwithstanding sub. (2) if any of
21the following applies:
AB1088,3,2
1(a) The information disclosed under sub. (2) is required to be reported under
2a specific permit condition or under an order issued by the department.
AB1088,3,63
(b) Within 3 years before the disclosure, a court decided that the person making
4the disclosure committed a pattern of continuous, repeated violations of
5environmental requirements in separate and distinct events related to a site or
6facility that resulted in significant harm to public health or the environment.
AB1088,3,107
(c) Within 3 years before the disclosure, the person making the disclosure has
8been subject to multiple settlement agreements related to substantially the same
9alleged violations as disclosed under sub. (2) and those violations resulted in
10significant harm to public health or the environment.
AB1088,3,1211
(d) The violation was committed with knowledge by an owner or operator of a
12site or facility that an environmental requirement was violated.
AB1088,3,20
13(4) Burden of proof. When the department commences an enforcement action
14against any person covered under sub. (2) for a violation of an environmental
15requirement based in whole or in part on information contained in an environmental
16audit and disclosed to the department, the disclosure shall be presumed to be
17voluntary. The department has the burden of proving by a preponderance of the
18evidence that a penalty may be imposed because the disclosure was not voluntary,
19because any of the conditions under sub. (2) (a) 1. to 3. were not met or because one
20of the exceptions under sub. (3) applies.
AB1088, s. 2
21Section
2. 905.20 of the statutes is created to read:
AB1088,3,22
22905.20 Environmental audit privilege.
(1) Definition. In this section:
AB1088,3,2523
(a) "Environmental audit" means an evaluation of a site facility or of an activity
24or management system related to a site or facility, if the evaluation meets all of the
25following criteria:
AB1088,4,1
11. Is conducted by or at the request of the owner or operator of the site.
AB1088,4,32
2. Is not required under a specific permit condition or under an order issued by
3the department.
AB1088,4,54
3. Is undertaken for the purpose of identifying, documenting and improving
5compliance with environmental requirements.
AB1088,4,96
(b) "Environmental requirement" means a federal, state or local environmental
7law, including any rule, regulation, ordinance, permit or special order issued under
8those laws. State environmental laws include chs. 144, 147, 159, 160 and 162 and
9ss. 146.20 and 166.20.
AB1088,4,17
10(2) General rule of privilege. An owner or operator of a site or facility has
11a privilege to refuse to disclose and to prevent any other person from disclosing any
12document or record, stored in any format, that is collected or developed for the
13primary purpose and in the course of, or as a result of, an environmental audit of the
14owner's or operator's site or facility. This privilege may be claimed in any civil or
15criminal action or administrative proceeding, including a contested case, as defined
16in s. 227.01 (3). Disclosure of any part of an environmental audit to any of the
17following does not waive the privilege under this section:
AB1088,4,1918
(a) An employe, agent, successor, assignee, director or shareholder of the owner
19or operator of the site or facility.
AB1088,4,2020
(b) An attorney of the owner or operator of the site or facility.
AB1088,4,2221
(c) An independent contractor retained by the owner or operator of the site or
22facility to review an issue raised as a result of the environmental audit.
AB1088,4,2523
(d) A partner or lender of the owner or operator of the site or facility or a person
24whom the owner or operator is currently negotiating with regarding partnership,
25transfer of ownership or lending of money.
AB1088,5,2
1(e) A state or federal official or employe under the terms of an agreement
2between a state or federal agency and the owner or operator of the site or facility.
AB1088,5,43
(f) The department of natural resources if the disclosure meets the conditions
4under s. 144.994 (2) (a).
AB1088,5,11
5(3) Who may claim the privilege. The privilege may be claimed by the owner
6or operator of the site or facility. If the owner or operator of the site or facility is a
7governmental unit, as defined in s. 939.648 (1), or a business entity, the privilege may
8be claimed by a director, officer, official, shareholder, trustee and managing employe,
9as defined in s. 49.498 (1) (e), or by any other employe who consented in writing to
10the preparation of the environmental audit. The authority to claim the privilege
11under this subsection is presumed without evidence to the contrary.
AB1088,5,17
12(4) Exceptions. (a) The privilege does not apply if a court of record, after an
13in camera review of the environmental audit, including a statement listing any
14activities undertaken as a result of the audit to achieve compliance with
15environmental requirements, determines that the person seeking access to the
16document or record related to an environmental audit proves by a preponderance of
17the evidence any of the following:
AB1088,5,1818
1. That the privilege is asserted for a fraudulent purpose.
AB1088,5,2119
2. That the owner or operator of the site or facility failed to take the appropriate
20responses necessary to achieve compliance within a reasonable time after any
21noncompliance was discovered as the result of an environmental audit.
AB1088,5,2522
3. That the environmental audit provides information about a site or facility
23that constitutes a violation of an environmental requirement and that the violation
24was committed with knowledge by an owner or operator of the site or facility that the
25site or facility violated an environmental requirement.
AB1088,6,4
1(b) The privilege does not apply if the state has reasonable cause to believe that
2the owner or operator has committed a criminal offense related to the site or facility
3in violation of environmental requirements, based on information independent of the
4environmental audit, and one of the following procedures is followed:
AB1088,6,95
1. The state, pursuant to a search warrant, subpoena or discovery in a criminal
6action, asks a court of record to take possession of a document or record related to an
7environmental audit and the person entitled to claim the privilege fails to petition
8the court of record within 60 days after the court takes possession to prevent the state
9from obtaining the document or record.
AB1088,6,2310
2. The state, pursuant to a search warrant, subpoena or discovery in a criminal
11action, asks a court of record to take possession of a document or record related to an
12environmental audit and the person entitled to claim the privilege petitions the court
13of record within 60 days after the court takes possession to prevent the state from
14obtaining the document or record. The petition shall include the date on which the
15environmental audit was completed, the name of the person who conducted the audit
16and a statement listing any activities undertaken as a result of the audit to achieve
17compliance with state or federal environmental requirements. Within 45 days after
18the filing of the petition, the court shall schedule a hearing regarding the petition.
19After the hearing and an in camera review of the documents submitted to the court
20regarding the audit, the court determines that there is probable cause to believe that
21the owner or operator of the site or facility has committed a criminal offense in
22violation of environmental requirements and has failed to take appropriate, prompt
23action to eliminate the violation and prevent future violations.
AB1088,6,2424
(c) The privilege does not apply to any of the following:
AB1088,7,2
11. Documents, data and reports that are collected, developed or maintained by
2a state or federal agency in accordance with specific environmental requirements.
AB1088,7,53
2. Information obtained by the observation, sampling or monitoring of a state
4or federal agency that regulates compliance with federal environmental
5requirements.