Texas Environmental Health & Safety Audit Privilege Act

To Disclose or Not To Disclose?

The Texas Environmental Health and Safety Audit Privilege Act allows companies not to disclose certain documents and information related to their self-audits for violations of state environmental, health, and safety laws and regulations. It also allows companies immunity from penalties for violations under certain conditions for timely voluntary disclosure. The act uses the term "persons" for individuals, corporations, partnerships, or other legal entities, but the act is used primarily by business entities.

History

The Texas Legislature originally passed the Audit Privilege Act in 1995, during George W. Bush's administration as Governor. The legislature amended the act in 1997 because the United States Environmental Protection Agency had refused to delegate federal environmental programs to Texas due, in part, to provisions of the 1995 act. Changes in the 1997 act removed the obstacles for delegation of the programs to Texas. Several states passed similar "Audit Privilege Laws" in the 1990s, beginning with Oregon in 1993.

Purpose

The Audit Privilege Act states that its purpose is "to encourage voluntary compliance with environmental and occupational health and safety law."

Provisions

The Audit Privilege Act offers violators of environmental, health, and safety laws and regulations two basic incentives for voluntary compliance. One is called a "limited evidentiary privilege." This means that a company can withhold information it gathers in a voluntary self-audit. A second incentive is immunity from penalties. Under this provision, companies that voluntarily disclose certain violations that have come to light in their self-audit can be exempted from administrative and civil penalties. According to the law, the privilege is denied, however, if a company has conducted an audit in bad faith or does not act in a timely manner to achieve compliance. The provisions do not apply to federal laws and regulations, only state ones.

Implementation

If you intend to make use of the act, a document published by the Texas Commission on Environmental Quality offers guidance. It explains the submissions you must make to satisfy conditions of the act, including notices of audit, disclosure of violation, and requests for extension. Appendices provide models of such submissions. The guidance document also explains the conditions and provisions for "evidentiary privilege" and immunity in more detail.

Controversy

Supporters of the Audit Privilege Act argue that the act encourages companies to protect the environment. A 1999 article quotes Jim Woodrick, then the president of the Texas Chemical Council that lobbied for the act. He contended that because self-audits had been subpoenaed in lawsuits, the industry was growing reluctant to conduct them been and promoted the law as an encouragement of self-audits. Opponents argue that the act allows violators to conceal information that is vital for the public interest and provides protection for polluters. One critic, Bertram Frey, deputy counsel for the EPA's Midwest region, quoted in a 1997 article, also pointed to the potential economic impact of audit privilege laws when responsible companies that bear the cost of full compliance must compete with those that use the law to postpone compliance and avoid penalties.

Opposition

References

• Texas Commission on Environmental Quality: Guidance on the Texas Environmental, Health, and Safety Privilege Act
• Texas Public Employees for Environmental Responsibility: The Privileged Class
• Law Server: Texas Civil Statutes 4447cc - Environmental, Health, And Safety Audit Privilege Act
• Environmental Health Perspectives: Audit-Privilege Laws
• Environmental Health Perspectives: Are Privilege and Immunity Laws Fair?