ARIZONA STATE SENATE
Phoenix, Arizona
voluntary environmental
performance
Establishes
a voluntary environmental performance program that allows organizations to
agree to meet and maintain certain environmental performance standards in
return for regulatory incentives from the Arizona Department of Environmental
Quality (ADEQ). Conditions the
enactment of this act on the appropriation of $250,000 by the 44th
Legislature from the general fund to ADEQ to administer this program.
During
the 1990s, a national debate took place over the use of environmental audit
programs as a method to encourage organizations to voluntarily disclose
violations of environmental laws and regulations in return for immunity from
liability for those violations. A
number of states adopted such programs during the mid 1990s. Legislation was introduced in Arizona in
both 1995 and 1996 to implement an environmental audit program. In 1995, the
legislation was vetoed by Governor Fife Symington, (SB 1290) and in 1996, the
legislation did not make it out of the Legislature.
In
1995, the Environmental Protection Agency developed an Environmental Audit
Policy that included more limited penalty waiver provisions. ADEQ is currently following a similar policy
that allows a waiver of penalties for certain disclosures. Additionally, ADEQ is administering a small
scale EPA pilot project that allows an organization to seek penalty mitigation
in exchange for disclosure of noncompliance relating to negotiated goals and
objectives.
In 1998, the EPA and the
Environmental Council of States signed a joint agreement to pursue regulatory
innovation and a number of states proceeded to enact laws based on the tenets
of the agreement. States included in
this effort include Pennsylvania, Illinois, North Carolina, Florida, California
and Wisconsin. S.B. 1321 is modeled after legislation adopted in some of these
states.
The fiscal impact of S.B. 1321
to the general fund in FY 2001 is $250,000 if an appropriation is made to meet
the conditions for enactment.
1. Requires the director of ADEQ to develop and implement a voluntary environmental performance program after consulting with stakeholders. The director is to adopt rules to implement the program.
Requirements for Participation
2. Stipulates that an organization is eligible to participate in the program if the organization:
·
Has
and maintains an appropriate environmental management system that includes an
environmental policy, procedures for complying with environmental laws and
rules, staff training programs to ensure compliance and annual environmental
performance evaluations made available to the public.
·
Maintains
verifiable measures that document compliance with environmental laws and rules
or other performance goals as required pursuant to a cooperative agreement with
ADEQ.
3. Allows the director to establish elective program elements for program participants, such as:
·
Implementation
of programs to assist other organizations by encouraging the transfer of
technology relating to environmental protection.
·
Active
participation in industry or business environmental improvement programs.
·
Active
participation in one or more voluntary environmental programs.
·
Role
in community environmental and environmental advisory programs.
·
Implementation
of programs to reward employees for meeting or exceeding environmental
requirements or to discipline employees for failing to meet requirements.
·
Implementation
of programs to reduce adverse environmental impacts relating to the
organization’s products and services.
·
Evaluation
and improvement of environmental management systems.
4. Allows the director to establish additional elective program elements if the elements are designed to improve the environmental quality of the state. These electives must have a reasonable nexus to organization’s type of business.
5. Requires the director to establish application procedures and review as many applications as practicable. If a submitted application is found to be complete or incomplete, the director shall notify the applicant. If incomplete, the notice shall describe the additional information required.
6. Requires the director to enter into one or more cooperative agreements with successful applicants to the program. These agreements are to include the incentives being offered to the organization and the performance required of the organization to receive these incentives.
7. Requires the director to notify an organization if an application cannot be approved and allow the organization to address the areas of deficiency. A decision by the director on whether or not to accept an organization in the program is final and is not subject to administrative or judicial review.
8. Requires the director to make certain documents relating to the application and agreement available to the public for at least 30 days before the director enters into an agreement with an organization to participate in the program. Requires the director to consider the public comments received on a proposed agreement.
9. Stipulates that all disclosures pursuant to a cooperative agreement are public records unless the disclosures are made for the purpose of receiving a civil penalty waiver that is not granted by the director. If a civil penalty waiver is not granted, disclosures made to get the waiver may not be used by director to prove noncompliance by the organization.
10. Requires the director to establish incentives which may be provided to a participating organization that complies with the mandatory program elements and the agreed to elective program elements. These incentives may include:
·
Total
or partial waiver of civil penalties for noncompliance after the organization
enters into a written cooperative agreement with ADEQ.
·
Extension
of permit terms up to the maximum time allowed by law.
·
Accelerated
review and processing of permit applications.
·
Consolidation
and simplification of reporting and monitoring requirements.
·
Consolidation
of permit applications and the designation of an ADEQ representative to be
responsible for all permitting communications with the organization.
·
Greater
reliance by ADEQ on the organization’s self-monitoring, self-reporting,
self-certification or third party certification in demonstrating compliance
with environmental laws and permits. (The minimum number of required ADEQ
inspections will not be reduced.)
·
Annual
public recognition by the Governor and director, such as state preferred vendor
status, awards, public announcements or news releases.
11. Requires the terms and conditions for the incentives to be included in the cooperative agreement entered into with ADEQ, as well as the standards for sufficient compliance.
12. Specifies that no decision made under the program is an appealable agency action or a contested case. Any participating organization adversely affected by a decision of the director to grant incentives or to terminate the organization from the program may seek judicial review in superior court. The organization must demonstrate that the director’s decision was arbitrary, capricious or an abuse of discretion.
13. Requires that any cooperative agreement that provides for civil penalty waivers for non-compliance by the participating organization applies only to noncompliance that begins after the organization’s entry into the program. Prohibits penalty waivers if the noncompliance:
·
Is
discovered by the organization and is not disclosed within 72 hours to the director
and corrected in a timely manner.
·
Is
discovered and is not disclosed by the organization before the organization
receives actual notice of a government inspection or investigation that might
reasonably be expected to discover the violation, the issuance of a government
information request related to the noncompliance, the reporting of the
violation to a governmental entity by a whistle-blower employee, the discovery
of the noncompliance by a government agency or the issuance of an
administrative order by a government agency relating to the noncompliance.
·
Results
in serious actual harm to human health or the environment.
·
Violates
the terms of a judicial or administrative order or consent agreement.
14. Allows the director to refuse to grant a civil penalty waiver if the noncompliance results in a significant cost savings for the organization, the noncompliance creates an imminent and substantial hazard to human health or the environment or the organization fails to cooperate with any investigations of the noncompliance problems.
15. Requires all civil penalty waiver requests and agency decisions on the waiver requests to be made available to the public. All penalty waivers are to be in the form of a written mutual agreement, an administrative consent order or a judicial consent judgment.
16. Allows a participating organization to withdraw from the program at any time, upon written notice to the director.
17. Requires the director to terminate a participating organization from the program if the organization makes misrepresentations or omissions in its application or at any time during its participation in the program, the organization or any of its senior agents acting on behalf of the organization are convicted of a felony or if the organization fails to comply with environmental requirements without satisfactory correction of the noncompliance. If the noncompliance occurs again, in spite of corrective procedures approved by the director, the director shall terminate the organization’s participation in the program.
18. Allows the director to terminate a participating organization from the program if the organization fails to comply with the terms of the cooperative agreement or if the organization fails to cooperate with the agency in participating in the program.
19. Requires all incentives to be withdrawn upon termination or withdrawal of a participating organization from the program. The organization forfeits any unused incentives.
Environmental Management Pollution Prevention
Fund Program
20. Requires the director to establish an environmental management pollution prevention fund program to provide low cost loans for pollution prevention, toxic use reduction, source reduction, resource recovery, energy efficiency and innovative environmental technology activities.
21. Establishes the environmental management pollution prevention fund consisting of legislative appropriations, gifts, grants and donations. Monies in the fund are non-lapsing and are continuously appropriated to the fund, except that administrative costs are subject to annual appropriation. Interest on the fund is credited to the fund.
22. Defines terms and provides an intent clause.
23. Conditions the enactment of the voluntary environmental performance act on the appropriation of at least $250,000 to ADEQ by the 44th Legislature for the purposes of the act.
24. Repeals the voluntary environmental performance act on December 31, 2004.
25. Provides for a general effective date.
Amendments Adopted by GES Committee
1.
Requires
the director of ADEQ to consider the public comments received on a proposed
voluntary environmental performance (VEP) agreement between an organization and
the agency.
2.
Requires
the director to terminate the participation of an organization that repeatedly
fails to comply with environmental laws, orders or judgements and fails to
implement the procedures approved by the director to comply with the VEP
agreement.
3.
Clarifies
that the waiver of penalties as an incentive for a participating agency is a
waiver of civil penalties only.
Stipulates that in order to qualify for a waiver of civil penalties, the
organization must disclose the noncompliance that would have resulted in the
civil penalties within 72 hours of discovery.
GES 2/7/00 DPA 8-0-1
APPROP W/D
Prepared by Senate Staff
February 16, 2000