71st OREGON LEGISLATIVE ASSEMBLY--2001 Regular Session
Enrolled
House Bill 3536
Sponsored by Representative SHETTERLY; Representative LEE (at the
request of Associated Oregon Industries)
CHAPTER ................
AN ACT
Relating to Environmental Audit Reports; amending ORS 468.963.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 468.963 is amended to read:
468.963. (1) In order to encourage owners and operators of
facilities and persons conducting other activities regulated
under ORS 824.050 to 824.110 or ORS chapter 465, 466, 468, 468A,
468B or 825, or the federal, regional or local counterpart or
extension of such statutes, both to conduct voluntary internal
environmental audits of their compliance programs and management
systems and to assess and improve compliance with such statutes,
an environmental audit privilege is recognized to protect the
confidentiality of communications relating to such voluntary
internal environmental audits.
(2) An Environmental Audit Report shall be privileged and shall
not be admissible as evidence { - in any legal action - } in
any civil { - , criminal - } or administrative proceeding,
except as provided in subsections (3) and (4) of this
section. { + The privilege provided in this subsection does not
apply to a criminal investigation or proceeding. When an
Environmental Audit Report is obtained in connection with a
criminal investigation or proceeding, the privilege provided in
this subsection related to civil or administrative proceedings is
not waived. + }
(3)(a) The privilege described in subsection (2) of this
section does not apply to the extent that it is waived expressly
or by implication by the owner or operator of a facility or
persons conducting an activity that prepared or caused to be
prepared the Environmental Audit Report. The release of an
Environmental Audit Report by the owner or operator of a facility
to any party or to any public body for purposes of negotiating,
arranging or facilitating the sale, lease or financing of a
property or a facility, or a portion of a property or facility:
(A) Is not a waiver of the privilege; and
(B) Does not create a right for a public body to require the
release of an Environmental Audit Report.
(b) In a civil or administrative proceeding, a court of record,
after in camera review consistent with the Oregon Rules of Civil
Procedure, shall require disclosure of material for which the
privilege described in subsection (2) of this section is
asserted, if such court determines that:
(A) The privilege is asserted for a fraudulent purpose;
Enrolled House Bill 3536 (HB 3536-INTRO) Page 1
(B) The material is not subject to the privilege; or
(C) Even if subject to the privilege, the material shows
evidence of noncompliance with ORS 824.050 to 824.110 or ORS
chapter 465, 466, 468, 468A, 468B or 825, or with the federal,
regional or local counterpart or extension of such statutes,
appropriate efforts to achieve compliance with which were not
promptly initiated and pursued with reasonable diligence.
{ - (c) In a criminal proceeding, a court of record, after in
camera review as described in subsection (4) of this section,
shall require disclosure of material for which the privilege
described in subsection (2) of this section is asserted, if the
court determines that: - }
{ - (A) The privilege is asserted for a fraudulent
purpose; - }
{ - (B) The material is not subject to the privilege; - }
{ - (C) Even if subject to the privilege, the material shows
evidence of noncompliance with ORS 824.050 to 824.110 or ORS
chapter 465, 466, 468, 468A, 468B or 825, or with the federal,
regional or local counterpart or extension of such statutes,
appropriate efforts to achieve compliance with which were not
promptly initiated and pursued with reasonable diligence; or - }
{ - (D) The material contains evidence relevant to commission
of an offense under ORS 468.922 to 468.956, the district attorney
or Attorney General has a compelling need for the information,
the information is not otherwise available and the district
attorney or Attorney General is unable to obtain the substantial
equivalent of the information by any means without incurring
unreasonable cost and delay. - }
{ - (d) - } { + (c) + } A party asserting the environmental
audit privilege described in subsection (2) of this section has
the burden of proving the privilege, including, if there is
evidence of noncompliance with ORS 824.050 to 824.110 or ORS
chapter 465, 466, 468, 468A, 468B or 825, or the federal,
regional or local counterpart or extension of such statutes,
proof that appropriate efforts to achieve compliance were
promptly initiated and pursued with reasonable diligence. A party
seeking disclosure under subsection (3)(b)(A) of this section has
the burden of proving that the privilege is asserted for a
fraudulent purpose. { - A district attorney or the Attorney
General seeking disclosure under subsection (3)(c)(D) of this
section has the burden of proving the conditions for disclosure
set forth in subsection (3)(c)(D) of this section. - }
(4)(a) A district attorney { + , + } { - or - } the Attorney
General { - , - } { + or a governmental agency + } having
probable cause to believe an offense has been committed under ORS
468.922 to 468.956 based upon information obtained from a source
independent of an Environmental Audit Report, may obtain an
Environmental Audit Report for which a privilege is asserted
under subsection (2) of this section pursuant to search warrant,
criminal subpoena or discovery as allowed by ORS 135.835. The
district attorney { + , + } { - or - } Attorney General
{ + or governmental agency + } shall immediately place the
report under seal and shall not review or disclose its contents.
(b) Within 30 days of the district attorney's { + , + }
{ - or - } Attorney General's { + or governmental agency's + }
obtaining an Environmental Audit Report, the owner or operator
who prepared or caused to be prepared the report may file with
the appropriate court a petition requesting an in camera hearing
on whether the Environmental Audit Report or portions thereof are
privileged under this section or subject to disclosure. Failure
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by the owner or operator to file such petition shall waive the
privilege.
(c) Upon filing of such petition, the court shall issue an
order scheduling an in camera hearing, within 45 days of the
filing of the petition, to determine whether the Environmental
Audit Report or portions thereof are privileged under this
section or subject to disclosure. Such order further shall allow
the district attorney { + , + } { - or - } Attorney General
{ + or governmental agency + } to remove the seal from the
report to review the report and shall place appropriate
limitations on distribution and review of the report to protect
against unnecessary disclosure. The district attorney { + , + }
{ - or - } Attorney General { + or governmental agency + } may
consult with enforcement agencies regarding the contents of the
report as necessary to prepare for the in camera hearing.
However, the information used in preparation for the in camera
hearing shall not be used in any investigation or in any
proceeding against the defendant, and shall otherwise be kept
confidential, unless and until such information is found by the
court to be subject to disclosure.
(d) The parties may at any time stipulate to entry of an order
directing that specific information contained in an Environmental
Audit Report is or is not subject to the privilege provided under
subsection (2) of this section.
(e) Upon making a determination under subsection (3)(b)
{ - or (c) - } of this section, the court may compel the
disclosure only of those portions of an Environmental Audit
Report relevant to issues in dispute in the proceeding.
(5) The privilege described in subsection (2) of this section
shall not extend to:
(a) Documents, communications, data, reports or other
information required to be collected, developed, maintained,
reported or otherwise made available to a regulatory agency
pursuant to ORS 824.050 to 824.110 or ORS chapter 465, 466, 468,
468A, 468B or 825, or other federal, state or local law,
ordinance, regulation, permit or order;
(b) Information obtained by observation, sampling or monitoring
by any regulatory agency; or
(c) Information obtained from a source independent of the
environmental audit.
(6) As used in this section:
(a) 'Environmental audit' means a voluntary, internal and
comprehensive evaluation of one or more facilities or an activity
at one or more facilities regulated under ORS 824.050 to 824.110
or ORS chapter 465, 466, 468, 468A, 468B or 825, or the federal,
regional or local counterpart or extension of such statutes, or
of management systems related to such facility or activity, that
is designed to identify and prevent noncompliance and to improve
compliance with such statutes. An environmental audit may be
conducted by the owner or operator, by the owner's or operator's
employees or by independent contractors.
(b) 'Environmental Audit Report' means a set of documents, each
labeled 'Environmental Audit Report: Privileged Document ' and
prepared as a result of an environmental audit. An Environmental
Audit Report may include field notes and records of observations,
findings, opinions, suggestions, conclusions, drafts, memoranda,
drawings, photographs, computer-generated or electronically
recorded information, maps, charts, graphs and surveys, provided
such supporting information is collected or developed for the
primary purpose and in the course of an environmental audit. An
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Environmental Audit Report, when completed, may have three
components:
(A) An audit report prepared by the auditor, which may include
the scope of the audit, the information gained in the audit,
conclusions and recommendations, together with exhibits and
appendices;
(B) Memoranda and documents analyzing portions or all of the
audit report and potentially discussing implementation issues;
and
(C) An implementation plan that addresses correcting past
noncompliance, improving current compliance and preventing future
noncompliance.
(7) Nothing in this section shall limit, waive or abrogate the
scope or nature of any statutory or common law privilege,
including the work product doctrine and the attorney-client
privilege.
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Passed by House May 10, 2001
...........................................................
Chief Clerk of House
...........................................................
Speaker of House
Passed by Senate June 1, 2001
...........................................................
President of Senate
Enrolled House Bill 3536 (HB 3536-INTRO) Page 4
Received by Governor:
......M.,............., 2001
Approved:
......M.,............., 2001
...........................................................
Governor
Filed in Office of Secretary of State:
......M.,............., 2001
...........................................................
Secretary of State
Enrolled House Bill 3536 (HB 3536-INTRO) Page 5