Louisiana Embraces Environmental Transparency: A Look at the New Voluntary Self-Audit Program

The state of Louisiana took a significant step towards environmental transparency and improved compliance with regulations for the implementation of its first-ever voluntary environmental self-audit program on December 20, 2023. The program is explained in detail as part of Vol. 49, No. 12 of the Louisiana Register (Starts on Page 2099). This program, established by the Louisiana Department of Environmental Quality (LDEQ), empowers businesses to proactively identify and address environmental violations, potentially lowering, and possibly eliminating civil penalties in the process. This article delves deeper into the details of the new program, exploring its benefits, and discussing potential considerations facilities should review before implementing the program.

Understanding Voluntary Environmental Self-Audits

Voluntary environmental self-audits are systematic reviews conducted by a business to assess its compliance with applicable environmental regulations. These audits involve examining operations, compliance documentation, and environmental management systems to identify potential violations or areas for improvement. Louisiana’s program is similar to both the Texas Commission on Environmental Quality’s (TCEQ) previously established Texas Audit Privilege Act and the United States Environmental Protection Agency’s (U.S. EPA) Audit Policy. Both of these programs allow and outline requirements for environmental self-audits.

Key Features of Louisiana’s Self Audit Program

To better understand the new LDEQ self-audit program, a summary of major requirements and timelines are outlined below:

• Voluntary Participation: Businesses have the discretion to choose whether or not to participate in the program.
• Incentive for Disclosure: Upon disclosing violations discovered during the self-audit to the LDEQ, businesses may be eligible for reduced or even eliminated civil penalties, provided that violations meet the program’s disclosure conditions. This incentive encourages self-identification and rectification of environmental issues, fostering a more collaborative approach to environmental compliance.
• Audit Review Fee: Businesses are required to pay a fee for the LDEQ to review the self-audit report and any proposed corrective actions. The fee structure includes a minimum of $1,500 and additional charges based on hourly rates and associated costs of LDEQ as specified in Louisiana Revised Statutes (LA R.S.) 30:2044(C).
• Specific Requirements: The program outlines specific requirements for conducting and reporting on the self-audit, including:
  • Initiation: The audit must be conducted by a qualified environmental professional once a Notice of Audit is given to LDEQ (notice forms and submission procedures will be available on LDEQ’s website).
  • Disclosure: The program mandates a comprehensive audit scope that covers all applicable environmental regulations relevant to the business’s operations. Violations must be disclosed to LDEQ within 45 days of discovery (disclosure forms and submission procedures will also be available on LDEQ’s website).
  • Extensions:  Should a facility not complete their self-audit within six months of their original notice, they can request a 30-day extension from LDEQ with reasonable justification.
  • Corrective Actions: Corrective actions taken as a result of audit findings must be completed within 90 days of the initial violation discovery. Any timeline longer than 90 days must be approved by LDEQ via writing.
  • Audit Report: Once the audit and all corrective actions are complete, an audit report must be written and sent to LDEQ including the notice of audit, violation disclosure, and proof of corrective action.

Benefits of the Program:

The potential for reduced or eliminated civil penalties encourages self-disclosure and corrective action, ultimately leading to a more cost-effective approach to environmental compliance for businesses. As the program currently stands, there are nine separate conditions that must be met to be eligible for 100% penalty reduction including but not limited too correctly following all self-audit rules for notification and disclosure outlined above, and making sure the violation observed has not previously occurred at the Facility in the last three years. For more information and the full list of these conditions please see the Vol. 49, No. 12 of the Louisiana Register (Starts on Page 2101). Overall, the program fosters a more collaborative relationship between businesses and the LDEQ, promoting open communication and problem-solving regarding environmental compliance through proactively identifying and addressing environmental issues.

Potential Considerations

When reviewing or implementing the LDEQ self-audit program, facilities should consider the following:

• Cost: Facilities should evaluate the cost of performing a self-audit versus the cost of potential noncompliance fines and/or the attorney fees required to navigate noncompliance.
• Reliance on Self-Disclosure: The program’s effectiveness relies heavily on the accuracy and completeness of self-disclosed information. Facilities using this program should pay careful attention during the self-audit, notification, and report submission to avoid potential incomplete disclosures or notifications.
• Limited Scope: The program focuses solely on civil penalties, and criminal sanctions for environmental violations remain unaffected.
• Excluded Violations: The following environmental violations are excluded from relief under the self-audit program:
  • Those that result in serious harm or substantial/imminent danger to the environment or public health.
  • Those discovered by the LDEQ or U.S. EPA, prior to disclosure.
  • Those detected through monitoring, sampling, or auditing procedures that are already required based on an order, regulation, permit, or consents agreement.
  • Those that are deliberate or closely related to a violation in the last three years subject to 40 CFR Part 68 and LAC 33: III.5901 (Chemical Accident Prevention).

Looking Forward

Like many states that have already implemented similar programs, facilities in Louisiana can now start planning and implementing this new self-audit program that allows for self-disclosure of environmental violations and potential reduction of civil penalties related. The implementation of Louisiana’s voluntary environmental self-audit program marks a significant step towards promoting environmental responsibility and fostering a culture of compliance within the state.

ALL4 Can Help!

ALL4’s diverse roster of environmental professionals has not only worked with similar self-audit programs in other states, such as Texas, but has performed environmental audits and understand environmental audit processes for all disciplines under the Environment, Health, and Safety umbrella. If you have any questions about LDEQ’s new self-audit program or want to learn more about ALL4’s audit support capabilities, please reach out to Andrew Hebert at ahebert@all4inc.com.