Office of Environmental Integration & Sustainability

Environmental Audit Privilege and Immunity Law

In 1994, the Colorado General Assembly passed legislation to provide incentives to facilities that conduct environmental audits of their operations. The law contains two parts, a privilege for environmental audit information and penalty immunity in response to the disclosure of certain regulatory violations.

In order to encourage the regulated community to voluntarily identify environmental concerns and to address them expeditiously without the fear of enforcement the Colorado legislature passed HB00-1481 in 2000 to address EPA’s concerns with the original law. The new legislation established a three-year pilot project and was to be read in conjunction with the original law.  The Colorado Department of Public Health and Environment submitted a report to the Legislature in June 2003 regarding conclusions based on the three-year pilot project.

Environmental Audit Privilege

The environmental audit privilege component of the Colorado Environmental Audit Privilege and Immunity Law is codified in two sections, (the audit privilege in section 13-25-126.5, C.R.S. and the testimonial privilege in section 13-90-107 C.R.S.), and creates an evidentiary privilege for information developed through a voluntary self-evaluation.

• Information required to be developed, maintained or reported by any applicable law, regulation, permit or order.
• Information obtained by a regulatory agency.
• Information developed or obtained from an independent source.
• Documents existing prior to or prepared subsequent to the voluntary self-evaluation.
• Documents developed or maintained in the regular course of business.
• Information disclosed in association with a request for penalty immunity, which constitutes waiver of the privilege for that information.

The privilege does not exist when:

• The privilege is waived by the entity who initiated the voluntary self-evaluation.
• A court or administrative law judge determines that the identified violations have not been addressed and a return to compliance has not been achieved.
• A court or administrative law judge determines that there is a clear, present and impending off-site danger to human health and the environment.
• A court or administrative law judge rules that the privilege is being asserted for a fraudulent purpose or that an investigation was imminent or underway.
• A court or administrative law judge determines that there are compelling reasons to divulge the privileged information.

The Colorado Environmental Audit Privilege and Immunity Law does not affect public access to any information currently available under the Colorado Open Records Act. This information would include, but is not limited to, permits, permit applications, monitoring data, and other compliance/inspection data maintained by the Colorado Department of Public Health and Environment.

Additionally, the audit privilege does not affect the Colorado Department of Public Health and Environment’s authority to enter any site, copy records, inspect, monitor or otherwise investigate compliance or citizen complaints.

The penalty immunity component of the Colorado Environmental Audit Privilege and Immunity Law is codified in section 25-1-114.5 C.R.S. and section 25-1-114.6 C.R.S.  Under certain conditions, voluntarily disclosed violations of State environmental laws and regulations will not result in the assessment of monetary penalties from the department.  Penalty immunity exists only for those disclosures that are voluntary.

For a disclosure to be considered voluntary it must meet all of the following criteria.

• The disclosure must be made promptly after knowledge of the noncompliance.
• The disclosure must arise out of a voluntary self-evaluation. (A voluntary self-evaluation is defined as a self-initiated assessment, audit, or review, not otherwise expressly required by environmental law, that is performed by any person or entity, for itself, either by an employee or employees employed by such person or entity who are assigned the responsibility of performing such assessment, audit, or review or by a consultant engaged by such person or entity expressly and specifically for the purpose of performing such assessment, audit, or review to determine whether such person or entity is in compliance with environmental laws.)
• The requester pursues compliance with due diligence and corrects the noncompliance within two years. Penalty immunity is not available unless the disclosing entity achieves actual compliance with environmental laws.
• The requester fully cooperates with the Colorado Department of Public Health and Environment.

In determining whether penalty immunity is justified and appropriate for a given set of circumstances, the Colorado Department of Public Health and Environment may consider the following discretionary factors:

• Whether the activities disclosed may create imminent and substantial endangerment of, or result in serious harm to, public health and the environment;
• Whether the activities disclosed conferred an unfair or excessive economic benefit on the disclosing entity.

Additionally, the Colorado Department of Public Health and Environment may assess penalties for criminal negligence when available under federal environmental law.

The Colorado Environmental Audit Privilege and Immunity Law does not limit the Colorado Department of Public Health and Environment’s authority to issue orders or require corrective actions to return to compliance.
 

Contact Information

If you are interested in utilizing the provisions of Colorado’s Environmental Audit Privilege and Immunity Law or if you have any general questions, please contact:

Lynette Myers 
Division of Environmental Health and Sustainabillity
(303)692-3477

If you have media-specific questions on the implementation of the Colorado Environmental Audit Privilege and Immunity Law, please contact one of the following individuals for assistance:

Steven Mah
Air Pollution Control Division
(303)692-3399

Ed Smith, Compliance Officer
Hazardous Materials and Waste Management Division
(303) 692-3300

Scott Klarich, Compliance Assurance / Enforcement Team
Water Quality Control Division
(303) 692-3500
 

Specific information on the Colorado Environmental Audit Privilege and Immunity Law

EPA / Office of Regulatory Enforcement - Audit Policy Information

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