New Oklahoma law to provide strong incentives for voluntary EHS self-audits and corrective measures
On April 29, 2019, Oklahoma Governor Kevin Stitt signed into law Senate Bill 1003, creating the Oklahoma Environmental, Health and Safety Audit Privilege Act. Once the Act becomes effective on November 1, 2019, the Act will provide strong incentives to regulated facilities and entities in Oklahoma to voluntarily: (1) evaluate compliance with state and federal environmental and/or occupational health and safety (EHS) laws, and (2) implement any needed corrective measures. Specifically, the Act provides certain evidentiary privileges for EHS self-audit reports, as well as enforcement immunity for potential non-compliance discovered, corrected, and voluntarily disclosed during the course of an EHS self-audit.
EHS audits covered by the Act are those voluntarily conducted by the owner or operator of a regulated facility or activity—or the prospective purchaser of a regulated facility—in order to assess compliance with state and federal environmental or occupational health and safety laws. The report generated by a voluntary EHS audit, including related communications and documents, will be privileged and confidential and inadmissible in a civil action or administrative proceeding. EHS audit reports that are privileged and confidential under the Act are also exempt from the provisions of the Oklahoma Open Records Act. The privilege may be waived or inapplicable in certain limited circumstances, and there is no privilege or confidentiality protection for documents, communications, data, or other information that is otherwise required to be collected or reported under applicable EHS laws. Additionally, information obtained by the observation, sampling, or monitoring of a regulatory agency will not be privileged.
In addition to the privilege and confidentiality protections provided by the Act, a regulated facility or entity that makes a voluntary disclosure of an EHS law violation to the appropriate regulatory agency may also be immune from an administrative or civil penalty for the violation disclosed. For the enforcement immunity to apply, the violation must have been revealed by a voluntary EHS audit and must be promptly remedied. Immunity will not apply if an investigation of the violation had already been initiated by a regulatory agency prior to the disclosure, nor if the violation resulted in injury or substantial risk of injury to persons at the site, off-site persons, or the off-site environment.
In order to maintain potential immunity for voluntary disclosure of violations discovered during and EHS audit, the facility or entity conducting the audit must provide notice of the planned EHS audit to the agency prior to initiation of the audit. Finally, there will be no enforcement immunity if: (a) the violation was committed willfully or knowingly, or recklessly with a resulting injury; (b) the violation resulted in a substantial economic benefit giving the violator a clear business advantage; or (c) the violating party has repeatedly or continuously committed significant violations that the party has not attempted to remedy.
For more information on the new Oklahoma Environmental, Health and Safety Audit Privilege Act, contact your McAfee & Taft environmental regulatory and compliance attorney.