Environmental August 2009 (Green Tier & Audit Prog) (A3420525-2)

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August 2009

Environmental Alert

Wisconsin Legislature Reauthorizes and Improves Green Tier and Environmental

Compliance Audit Programs

On July 8, 2009, Governor Jim Doyle signed into law legislation reauthorizing two programs

designed to encourage and reward environmental performance:

1. The Green Tier Program (“Green Tier”) promotes “superior environmental performance” by

regulated businesses, industries and municipalities, and

2. The Environmental Compliance Audit Program (“Audit Program”) encourages the conduct of

environmental audits and provides protection against potential penalties for identified

violations.

2009 Wisconsin Act 30 became effective on July 10, 2009, and amended various provisions of Wis.

Stat. §§ 299.83 and 299.85.

In effect since March 2004, both programs are administered by the Wisconsin Department of Natural

Resources (WDNR) and both were scheduled to sunset on July 1, 2009. With overwhelming support

from the business, environmental, academic and governmental communities, the Wisconsin

legislature determined these two programs serve important environmental policy objectives,

eliminated the sunset provisions, and made other program improvements.

Are you in compliance and want to do more? Not sure if you in compliance and not sure how

to find out?

If you have good reason to believe that your facility is meeting its environmental compliance

requirements and you want to do more, the Green Tier Program may be for you. If you are uncertain

about your environmental compliance status and want to start out by getting a good handle on it, the

Environmental Compliance Audit Program may provide you the opportunity to do so with relatively

low-risk of enforcement or penalties.

How these programs work:

Green Tier

Green Tier encourages regulated businesses, industries and municipalities to go beyond basic

compliance and achieve a higher level of environmental performance. The program is entirely

voluntary. Participants select the environmental areas in which they will strive to achieve superior

environmental performance, set their own targets and develop and implement an environmental

management system.

Designed to recognize “good actors”, Green Tier eligibility criteria include the proposed participants’

prior environmental compliance record.

The program emphasizes “transparency” so that WDNR and

the public can track the commitments and achievements. Participants can enter the program at Tier I

or Tier II, individually or as part of a group under a Charter. Tier I is for participants that do not have

an environmental management system and commit to develop and implement one; Tier II is for

participants that already have an environmental management system. Tier I participants audit their

environmental management system; Tier II participants audit their facilities’ environmental

compliance. Any violations identified are not subject to enforcement so long as the participant

corrects them within a specified time period.

For more information, please see:

“2003 Wisconsin Act 276 - The Environmental Results Program and The Environmental

Improvement Program (a.k.a. ‘Green Tier’)” (December 2004), available at:

http://www.michaelbest.com/2003-wisconsin-act-276-green-tier/

“Green Tier: What is it anyway?” (April 8, 2005), available at http://www.michaelbest.com/green-tier-

what-is-it-anyway/

Or visit the WDNR website on Green Tier, available at http://dnr.wi.gov/org/caer/cea/environmental/

Environmental Compliance Audit Program

The Environmental Compliance Audit Program encourages regulated businesses, industries and

municipalities to conduct environmental compliance audits and to promptly discover, disclose and

correct violations in return for forgiveness of enforcement and potential civil penalties. The law

provides that the state cannot file a civil suit to seek penalties unless the violations are not corrected

within a set period of time, and in those limited circumstances sets a maximum penalty of $500 per

violation, regardless of the number of days of violation.

While it has some elements in common with the Green Tier program, the Audit Program is a

separate program. Entities wishing to utilize the Audit Program do not need to be Green Tier

participants. Modeled on the United States Environmental Protection Agency (“EPA”) Audit Policy,

the WDNR Program has its procedural differences. Chief among them is the requirement to provide

WDNR at least 30 days’ notice before conducting the audit.

For more information, please see:

“EPA Targets Incentives to Conduct Environmental Compliance Audits in 2008” (January 24, 2008),

available at: http://www.michaelbest.com/epa-targets-incentives-to-conduct-environmental-

compliance-audits-in-2008/

Or visit the EPA website page on EPA Audit Policy, available at:

http://www.epa.gov/Compliance/incentives/auditing/index.html

2009 Legislative Improvements:

In addition to permanently reauthorizing these programs, Act 30 made the following program

improvements:

Green Tier Program

1.

Renamed the program Green Tier, to reflect the commonly-recognized name, in lieu of the

Environmental Results Program.

2.

Provided additional flexibility:

a.

Made the definition of a “functionally equivalent environmental management system”

more flexible by recognizing that it should be “appropriate to the nature, scale and

environmental impacts” of the entity’s “activities, products and services.”

b.

Continued the ability of the WDNR Secretary to waive enforcement record eligibility

criteria for participation in Tier I and Tier II, if doing so will not erode public

confidence in the integrity of the program.

c.

Authorized the WDNR Secretary to extend a compliance schedule for corrective

action beyond 12 months when deemed necessary.

d.

Added protection for violations discovered and reported by a participant while

operating under the program, but not as a result of conducting an audit.

3.

Confirmed transparency:

a.

Clarified that the environmental policy adopted as part of an environmental

management system is available to the public.

b.

Specified that a Tier II contract contain a provision describing how the participant will

maintain the involvement of interested parties during the term of the contract.

Environmental Compliance Audit Program

1.

Renamed the program the Environmental Compliance Audit Program, to reflect the

commonly-recognized name, in lieu of the Environmental Improvement Program.

2.

Provided additional flexibility:

a.

Removed an impediment to participation: Previously, an entity was not able to utilize

this program if it had been subject to a civil suit by the Wisconsin Department of

Justice (WDOJ), or a citation from WDNR or a local governmental unit in the prior

two years. This language has been changed to eliminate any consideration of

previously issued citations. WDNR is directed to consider whether the entity had

been subject to civil suit by the WDOJ and if so, the nature of that civil suit; if on that

information WDNR determines the entity’s participation would “damage the integrity”

of the Audit Program, WDNR is to notify the entity it is not eligible.

b.

Authorized the WDNR Secretary to extend a compliance schedule for corrective

action beyond 12 months when deemed necessary.

This Alert is a publication of Michael Best & Friedrich LLP and is intended to provide clients and friends with information on recent legal developments. This

Alert should not be construed as legal advice or an opinion on specific situations. For further information, feel free to contact article authors or other

members of the firm. We welcome your comments and suggestions regarding this publication. © 2009 Michael Best & Friedrich LLP. All rights reserved.