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Self Audit Reporting

(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.

 

 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.

 

The privilege does not apply to:

  • 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 department.

Additionally, the audit privilege does not affect the department's authority to enter any site, copy records, inspect, monitor or otherwise investigate compliance or citizen complaints.

 

Penalty Immunity

 

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 Colorado Department of Public Health and Environment. 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 department.

 

 

In determining whether penalty immunity is justified and appropriate for a given set of circumstances, the department 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 department may assess penalties for criminal negligence when available under federal environmental law.

 

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

 

 

 

 Please note: The information on this page is for Immunity under Colorado state law, for additional information to determine if a request should be filed separately with the EPA as per the federal law, please go to the EPA Self Audit Policy website at: http://www.epa.gov/compliance/incentives/auditing/auditpolicy.html    

 

 

 

 

  


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