First Regular Session

Sixty-first General Assembly

LLS NO. 97­0513.01 BWM HOUSE BILL 97­1254

STATE OF COLORADO

BY REPRESENTATIVE Grampsas;

also SENATOR Norton.

BUSINESS AFFAIRS & LABOR

APPROPRIATIONS

A BILL FOR AN ACT

CONCERNING THE CREATION OF AN ENVIRONMENTAL LEADERSHIP PROGRAM, AND, IN CONNECTION THEREWITH, CREATING AN ENVIRONMENTAL LEADERSHIP POLLUTION PREVENTION REVOLVING FUND, ENACTING A TAX CREDIT FOR POLLUTION PREVENTION, TOXIC USE REDUCTION, SOURCE REDUCTION, RESOURCE RECOVERY, ENERGY EFFICIENCY, AND INNOVATIVE ENVIRONMENTAL TECHNOLOGY ACTIVITIES FOR ENVIRONMENTAL LEADERS, AND MAKING AN APPROPRIATION.

Bill Summary

(Note: This summary applies to this bill as introduced and does not necessarily reflect any amendments which may be subsequently adopted.)

Declares that entities that demonstrate commitment to the environment, by going beyond compliance with environmental laws and regulation, positively impact the quality of life for the citizens of this state. Further declares that the increased use of pollution prevention strategies, cost­effective options for compliance with environmental laws, and reduction in occurrences of noncompliance with environmental laws can be achieved through the establishment of a voluntary environmental leadership program to be administered by the department of public health and environment (department).

Establishes the program and defines necessary terminology with respect thereto. Empowers the department to administer the program and specifies that participation in the program by any entity is voluntary and subject to review every 3 years.

Sets forth eligibility requirements and application requirements for participants in the program. Requires the department to review each application and to incorporate acceptable proposals into written agreements between the participant and the department setting forth any incentives to be provided to a participating entity. Provides for public review and comment prior to the effectiveness of any such agreement. Sets forth the circumstances for termination from the program.

Specifies possible incentives, financial and otherwise, that may be provided to program participants.

Creates the environmental pollution prevention revolving fund in the state treasury for the deposit of moneys used in the administration of the program and the provision of incentives to program participants. Provides for the deposit of moneys from certain sources into such fund.

Requires the department to review and approve expenditures for which program participants may seek income tax credits. Specifies the information required for the review of such expenditures by the department. Limits the total amount of expenditures that the department may certify for income tax credits each year. Enacts an income tax credit in the amount of 30% of the difference between the approved total net expenditures of a program participant and the net expenditure required to comply with applicable environmental statutes, regulations, and permits.

Appropriates $200,000 from the general fund to the department of public health and environment for the implementation of this act.

Be it enacted by the General Assembly of the State of Colorado:

SECTION 1.  Title 25, Colorado Revised Statutes, 1989 Repl. Vol., as amended, is amended BY THE ADDITION OF A NEW ARTICLE to read:

25­6.7­101.  Short title. THIS ARTICLE SHALL BE KNOWN AND MAY BE CITED AS THE "ENVIRONMENTAL LEADERSHIP ACT".

25­6.7­102.  Legislative declaration. (1)  THE GENERAL ASSEMBLY HEREBY FINDS, DETERMINES, AND DECLARES THAT ENVIRONMENTAL LEADERS WHO DEMONSTRATE THEIR COMMITMENT TO THE ENVIRONMENT BY GOING BEYOND COMPLIANCE WITH ENVIRONMENTAL LAWS AND REGULATIONS POSITIVELY IMPACT THE QUALITY OF LIFE FOR ALL OF THE CITIZENS OF THE STATE OF COLORADO. BY MOVING BEYOND COMPLIANCE, ENVIRONMENTAL LEADERS IMPROVE THE ECONOMY AND THE ENVIRONMENT BY INCREASING CONSUMER AND SHAREHOLDER CONFIDENCE, BOOSTING MANAGEMENT AND EMPLOYEE MORALE, AND OPERATING IN A SAFE AND SENSIBLE MANNER THAT LESSENS THEIR IMPACTS ON THE ENVIRONMENT. THE GENERAL ASSEMBLY FURTHER FINDS, DETERMINES, AND DECLARES THAT INCREASED USE OF POLLUTION PREVENTION STRATEGIES, MORE COST­EFFECTIVE OPTIONS FOR COMPLIANCE WITH ENVIRONMENTAL LAWS, AND REDUCTION IN OCCURRENCES OF NONCOMPLIANCE WITH ENVIRONMENTAL LAWS CAN BE ACHIEVED THROUGH THE ESTABLISHMENT AND IMPLEMENTATION OF A VOLUNTARY ENVIRONMENTAL LEADERSHIP PROGRAM PURSUANT TO THIS ARTICLE.

(2)  THE GENERAL ASSEMBLY FURTHER FINDS, DETERMINES, AND DECLARES THAT SUCH VOLUNTARY PROGRAM SHOULD PROVIDE ENTITIES WITH THE OPPORTUNITY TO ENTER INTO AGREEMENTS WITH THE COLORADO DEPARTMENT OF PUBLIC HEALTH AND ENVIRONMENT THROUGH WHICH THE DEPARTMENT SHALL ADMINISTER FINANCIAL AND OTHER BENEFITS TO THE PARTICIPATING ENTITIES THAT COMPLY WITH A PRESCRIBED NUMBER OF PROGRAM ELEMENTS ESTABLISHED BY THE DEPARTMENT DESIGNED TO REDUCE THE ADVERSE ENVIRONMENTAL IMPACTS OF THE ENTITY BEYOND THAT WHICH WOULD BE ACHIEVED BY COMPLIANCE WITH ENVIRONMENTAL LAWS AND PERMITS ALONE.

(3)  THE GENERAL ASSEMBLY FURTHER FINDS, DETERMINES, AND DECLARES THAT ENVIRONMENTAL LEADERS SHOULD BE GRANTED FINANCIAL INCENTIVES FOR POLLUTION PREVENTION, TOXIC USE REDUCTION, SOURCE REDUCTION, RESOURCE RECOVERY, ENERGY EFFICIENCY, AND INNOVATIVE ENVIRONMENTAL TECHNOLOGY INVESTMENTS THAT TAKE THE ENTITY BEYOND COMPLIANCE WITH STATE AND FEDERAL ENVIRONMENTAL LAWS AND PERMITS.

(4)  THE GENERAL ASSEMBLY FURTHER FINDS, DETERMINES, AND DECLARES THAT NOTHING IN THIS ARTICLE SHALL BE CONSTRUED AS REQUIRING ANY ENTITY IN COLORADO TO PARTICIPATE IN ANY ENVIRONMENTAL LEADERSHIP PROGRAM ESTABLISHED BY THE DEPARTMENT UNDER THIS ARTICLE.

25­6.7­103.  Definitions. AS USED IN THIS ARTICLE, UNLESS THE CONTEXT OTHERWISE REQUIRES:

(1)  "DEPARTMENT" MEANS THE DEPARTMENT OF PUBLIC HEALTH AND ENVIRONMENT CREATED IN SECTION 25­1­102.

(2)  "ENVIRONMENTAL LEADER" MEANS AN ENTITY THAT HAS COMPLIED WITH THE MANDATORY AND ELECTIVE ELEMENTS OF THE PROGRAM AND HAS A WRITTEN AGREEMENT WITH THE DEPARTMENT.

(3)  "EXECUTIVE DIRECTOR" MEANS THE EXECUTIVE DIRECTOR OF THE DEPARTMENT.

(4)  "ENTITY" MEANS A CORPORATION, PARTNERSHIP, SOLE PROPRIETORSHIP, MUNICIPALITY, COUNTY, OR SPECIAL DISTRICT LOCATED IN AND DOING BUSINESS IN COLORADO.

(5)  "POLLUTION PREVENTION" MEANS ANY PRACTICE THAT REDUCES THE USE OF ANY HAZARDOUS SUBSTANCE, AS DEFINED IN SECTION 25­16.5­103 (5), OR AMOUNT OF ANY POLLUTANT OR CONTAMINANT PRIOR TO RECYCLING, TREATMENT, OR DISPOSAL AND REDUCES THE HAZARDS TO PUBLIC HEALTH AND THE ENVIRONMENT ASSOCIATED WITH THE USE OR RELEASE, OR BOTH, OF SUCH SUBSTANCES, POLLUTANTS, OR CONTAMINANTS.

(6)  "PROGRAM" MEANS THE VOLUNTARY ENVIRONMENTAL LEADERSHIP PROGRAM ESTABLISHED UNDER THIS ARTICLE.

(7)  "SERIOUS VIOLATION" MEANS:

(a)  VIOLATIONS THAT MAY CAUSE SIGNIFICANT IMPACT TO HUMAN HEALTH OR THE ENVIRONMENT;

(b)  A PATTERN OF VIOLATIONS THAT DEMONSTRATES MANAGEMENT SYSTEMS ARE NOT ADEQUATE TO ADDRESS ENVIRONMENTAL ISSUES; OR

(c)  CONVICTIONS FOR VIOLATIONS OF ENVIRONMENTAL LAWS OR OUT­OF­COURT SETTLEMENTS OF FORMAL CHARGES OF SUCH CRIMINAL VIOLATIONS.

(8) (a)  "SOURCE REDUCTION" MEANS ANY PRACTICE THAT:

(I)  REDUCES THE AMOUNT OF ANY HAZARDOUS SUBSTANCE, POLLUTANT, OR CONTAMINANT ENTERING ANY WASTE STREAM OR OTHERWISE RELEASED INTO THE ENVIRONMENT (INCLUDING FUGITIVE EMISSIONS) PRIOR TO RECYCLING, TREATMENT, OR DISPOSAL; AND

(II)  REDUCES THE HAZARDS TO PUBLIC HEALTH AND THE ENVIRONMENT ASSOCIATED WITH THE RELEASE OF SUCH SUBSTANCES, POLLUTANTS, OR CONTAMINANTS.

(b)  "SOURCE REDUCTION" INCLUDES EQUIPMENT OR TECHNOLOGY MODIFICATIONS, PROCESS OR PROCEDURE MODIFICATIONS, REFORMULATION OR REDESIGN OF PRODUCTS, SUBSTITUTION OF RAW MATERIALS, AND IMPROVEMENTS IN HOUSEKEEPING, MAINTENANCE, TRAINING, OR INVENTORY CONTROL.

(c)  "SOURCE REDUCTION" DOES NOT INCLUDE ANY PRACTICE THAT ALTERS THE PHYSICAL, CHEMICAL, OR BIOLOGICAL CHARACTERISTICS OR THE VOLUME OF A HAZARDOUS SUBSTANCE, POLLUTANT, OR CONTAMINANT THROUGH A PROCESS OR ACTIVITY THAT ITSELF IS NOT INTEGRAL TO AND NECESSARY FOR THE PRODUCTION OF A PRODUCT OR THE PROVIDING OF A SERVICE.

(9)  "TOXIC USE REDUCTION" MEANS CHANGES IN PRODUCTION PROCESSES, PRODUCTS, OR RAW MATERIALS THAT REDUCE, AVOID, OR ELIMINATE THE USE OF TOXIC OR HAZARDOUS SUBSTANCES AND THE GENERATION OF HAZARDOUS BY­PRODUCTS PER UNIT OF PRODUCTION TO REDUCE THE OVERALL RISKS TO THE HEALTH OF WORKERS, CONSUMERS, OR THE ENVIRONMENT WITHOUT CREATING NEW RISKS OF CONCERN.

25­6.7­104.  Powers and duties of department. (1)  THE EXECUTIVE DIRECTOR, AFTER CONSULTATION WITH REPRESENTATIVES FROM THE REGULATED COMMUNITY, LOCAL GOVERNMENT, ENVIRONMENTAL AND PUBLIC INTEREST GROUPS, AND OTHER INTERESTED PERSONS, SHALL DEVELOP AND IMPLEMENT A VOLUNTARY ENVIRONMENTAL LEADERSHIP PROGRAM IN ACCORDANCE WITH THIS ARTICLE. APPLICATION TO THE PROGRAM MAY BE MADE FOR A SPECIFIC ENTITY, OPERATING UNIT, OR FACILITY.

(2)  THE DEPARTMENT SHALL ADMINISTER THE PROGRAM.

(3)  PARTICIPATION IN THE PROGRAM BY ANY ENTITY SHALL BE VOLUNTARY AND SHALL BE SUBJECT TO REVIEW EVERY THREE YEARS.

(4)  THE EXECUTIVE DIRECTOR SHALL HAVE THE AUTHORITY TO REVIEW AND CERTIFY POLLUTION PREVENTION, TOXIC USE REDUCTION, AND SOURCE REDUCTION INVESTMENTS AS PROVIDED IN SECTION 39­5­131, C.R.S.

25­6.7­105.  Eligibility and application requirements. (1)  THE EXECUTIVE DIRECTOR SHALL DETERMINE MANDATORY PROGRAM ELEMENTS AND APPLICATION REQUIREMENTS FOR PARTICIPATION IN THE PROGRAM. SUCH ELEMENTS SHALL INCLUDE:

(a)  EVIDENCE OF NO SERIOUS VIOLATIONS OF ALL APPLICABLE STATE AND FEDERAL ENVIRONMENTAL LAWS AND PERMITS FOR A MINIMUM PERIOD OF THREE YEARS IMMEDIATELY PRIOR TO THE DATE OF SUBMISSION OF THE APPLICATION FOR PARTICIPATION IN THE PROGRAM;

(b)  EVIDENCE THAT NO SETTLEMENT AGREEMENT HAS BEEN ENTERED INTO AND THAT NO COMPLIANCE OR CONSENT ORDER HAS BEEN ISSUED FOR SERIOUS VIOLATIONS OF ENVIRONMENTAL LAWS AND PERMITS FOR THE THREE YEARS IMMEDIATELY PRIOR TO THE DATE OF SUBMISSION OF THE APPLICATION FOR PARTICIPATION IN THE PROGRAM;

(c)  THE EXISTENCE AND MAINTENANCE OF AN ENVIRONMENTAL MANAGEMENT SYSTEM TO INCLUDE, AS APPROPRIATE, MANAGEMENT­APPROVED ENVIRONMENTAL POLICIES, RELEVANT PROCEDURES, AND GOALS TO ACHIEVE ENVIRONMENTAL COMPLIANCE AND TRAINING PROGRAMS, COMPLIANCE AUDIT PROGRAMS, AND COMMUNICATION PROGRAMS RELATED TO ENVIRONMENTAL COMPLIANCE;

(d)  THE EXISTENCE AND MAINTENANCE OF AN ENVIRONMENTAL COMPLIANCE AUDIT PROGRAM TO ASSESS COMPLIANCE WITH ENVIRONMENTAL LAWS, CORRECT NONCOMPLIANCE WITHIN A REASONABLE PERIOD OF TIME, AND REPORT AUDIT FINDINGS AS REQUIRED BY LAW;

(e)  THE EXISTENCE AND MAINTENANCE OF A POLLUTION PREVENTION PROGRAM OR PLAN WITH SPECIFIC GOALS AND COMMITTED ACTIONS TO REDUCE RELEASES OF POLLUTANTS OR THE USE OF RESOURCES BEYOND THE REDUCTION REQUIRED BY LAW OR PERMIT;

(f)  THE EXISTENCE AND MAINTENANCE OF VERIFIABLE, QUANTITATIVE AND QUALITATIVE MEASURES OR METHODS THAT DOCUMENT COMPLIANCE WITH ENVIRONMENTAL REQUIREMENTS, RESOURCE CONSERVATION GOALS, AND POLLUTION PREVENTION PERFORMANCE GOALS;

(g)  THE EXISTENCE AND MAINTENANCE OF A POLICY THAT THE ENTITY'S EMPLOYEES WILL NOT BE TERMINATED OR DISCIPLINED FOR REPORTING, IN GOOD FAITH, VIOLATIONS OF ANY FEDERAL OR STATE LAW OR PERMIT, OR ANY REQUIREMENT OF THE PROGRAM.

(2)  IN ADDITION TO THE MANDATORY PROGRAM ELEMENTS AND APPLICATION REQUIREMENTS, THE EXECUTIVE DIRECTOR SHALL ESTABLISH ALTERNATIVE ELECTIVE PROGRAM ELEMENTS. ENTITIES APPLYING TO PARTICIPATE IN THE PROGRAM SHALL SELECT FROM AMONG SUCH ALTERNATIVE ELECTIVE PROGRAM ELEMENTS AND COMPLETE THOSE SELECTED. THE NUMBER OF ELECTIVE PROGRAM ELEMENTS SHALL BE BASED ON THE SIZE OF THE ENTITY, AS DETERMINED BY THE EXECUTIVE DIRECTOR. ENTITIES SHALL HAVE THE ABILITY TO CHOOSE FROM AMONG THE LIST OF ELEMENTS TO SUBSTITUTE AN ALTERNATIVE ELECTIVE PROGRAM ELEMENT THAT DEMONSTRATES A SUBSTANTIVE COMMITMENT TO THE GOALS OF THE PROGRAM IN CONSULTATION WITH THE DEPARTMENT. ALL ELECTIVE PROGRAM ELEMENTS SHALL BE DESIGNED TO RESULT IN THE MEASURABLE IMPROVEMENT AND ENHANCEMENT OF THE ENVIRONMENTAL QUALITY OF THE STATE OF COLORADO OR MUST BE ACTIVITIES THAT ARE BENEFICIAL TO THE ENVIRONMENT. ELECTIVE PROGRAM ELEMENTS MAY INCLUDE, BUT NEED NOT BE LIMITED TO:

(a)  DEVELOPMENT AND MAINTENANCE OF PROGRAMS THAT PROVIDE TECHNICAL ASSISTANCE OR MENTORING TO ONE OR MORE SPECIFIED ORGANIZATIONS TO ENCOURAGE RESPONSIBLE ENVIRONMENTAL STEWARDSHIP AND TECHNOLOGY TRANSFERS;

(b)  ACTIVE PARTICIPATION IN INDUSTRY, GOVERNMENT, OR BUSINESS ENVIRONMENTAL IMPROVEMENT OR ADVOCACY PROGRAMS;

(c)  DEVELOPMENT AND MAINTENANCE OF SUPPLIER AND CONSUMER ENVIRONMENTAL AWARENESS PROGRAMS;

(d)  ACTIVE PARTICIPATION IN OR IMPLEMENTATION OF ONE OR MORE RECOGNIZED VOLUNTARY ENVIRONMENTAL PROGRAMS;

(e)  PUBLICATION AND PUBLIC DISTRIBUTION OF ANNUAL ENVIRONMENTAL PERFORMANCE SUMMARY REPORTS;

(f)  PROMOTION, SPONSORSHIP, AND PARTICIPATION IN COMMUNITY ENVIRONMENTAL AND ADVISORY PROGRAMS;

(g)  DEVELOPMENT AND MAINTENANCE OF MANAGEMENT PROGRAMS THAT ENCOURAGE AND REWARD EMPLOYEES FOR MEETING OR EXCEEDING REQUIREMENTS OF ENVIRONMENTAL LAWS OR PERMITS AND FOR PARTICIPATION IN VOLUNTARY ENVIRONMENTAL ACTIVITIES;

(h)  DEVELOPMENT OR IMPLEMENTATION OF PROGRAMS THAT REDUCE ADVERSE ENVIRONMENTAL IMPACTS OF DEVELOPMENT, MANUFACTURE, DISTRIBUTION, AND MARKETING OF THE ENTITY'S PRODUCTS OR SERVICES;

(i)  EVALUATION AND REVISION OF ENVIRONMENTAL MANAGEMENT SYSTEMS TO UPDATE AND STRENGTHEN ENVIRONMENTAL POLICIES, PROCEDURES, GOALS, AND TRAINING PROGRAMS;

(j)  ACQUISITION AND MAINTENANCE OF NATIONAL OR INTERNATIONAL ENVIRONMENTAL CERTIFICATION;

(k)  CONTRIBUTION OF RESOURCES TO PUBLIC EDUCATIONAL INSTITUTIONS OR PRIVATE NONPROFIT INSTITUTIONS TO TEACH ENVIRONMENTAL AWARENESS, POLLUTION PREVENTION, OR RESOURCE CONSERVATION OR BOTH SUCH PREVENTION AND CONSERVATION.

(3)  THE EXECUTIVE DIRECTOR MAY ESTABLISH ADDITIONAL ELECTIVE PROGRAM ELEMENTS SO LONG AS SUCH ELEMENTS ARE DESIGNED TO RESULT IN THE MEASURABLE IMPROVEMENT AND ENHANCEMENT OF THE ENVIRONMENTAL QUALITY OF THE STATE OF COLORADO.

(4)  THE EXECUTIVE DIRECTOR SHALL ESTABLISH APPLICATION FORMS FOR ENTITIES TO SUBMIT PROPOSALS TO PARTICIPATE IN THE PROGRAM. THE DEPARTMENT SHALL REVIEW ALL APPLICATION PROPOSALS SUBMITTED FOR THE PROGRAM AND SHALL EITHER NOTIFY THE ENTITY THAT THE APPLICATION IS COMPLETE OR THAT THE APPLICATION IS INCOMPLETE, AND THE DEPARTMENT SHALL DESCRIBE WHAT ADDITIONAL INFORMATION IS REQUIRED. THE ENTITY MAY CORRECT THE APPLICATION AND RESUBMIT IT AT ANY TIME.

(5)  AN ENTITY MAY APPLY FOR PARTICIPATION IN THE PROGRAM FOR A SPECIFIC OPERATING UNIT, FACILITY, OR THE ENTIRE ENTITY.

25­6.7­106.  Application review and authority to enter into agreement. (1)  THE DEPARTMENT SHALL REVIEW ALL COMPLETED APPLICATION PROPOSALS WITHIN A REASONABLE PERIOD OF TIME. IF THE DEPARTMENT DETERMINES THAT THE PROPOSAL MEETS THE REQUIREMENTS OF THE PROGRAM, THE DEPARTMENT SHALL NOTIFY THE ENTITY IN WRITING, AND THE PROPOSAL SHALL BE INCORPORATED INTO A WRITTEN AGREEMENT BETWEEN THE DEPARTMENT AND THE ENTITY. IF THE DEPARTMENT DETERMINES THAT THE PROPOSAL DOES NOT MEET THE REQUIREMENTS OF THE PROGRAM, THE DEPARTMENT SHALL NOTIFY THE ENTITY IN WRITING AND SHALL PROVIDE AN ADEQUATE OPPORTUNITY FOR THE ENTITY TO ADDRESS THE IDENTIFIED OUTSTANDING ITEMS.

(2)  THE DEPARTMENT MAY ENTER INTO ONE OR MORE AGREEMENTS WITH AN ENTITY AS NECESSARY TO IMPLEMENT THE PROVISIONS OF THIS ARTICLE, AND SUCH AGREEMENT SHALL DESCRIBE THE INCENTIVES TO BE PROVIDED TO THE ENTITY.

(3)  THE FOLLOWING DOCUMENTS SHALL BE MADE AVAILABLE FOR PUBLIC REVIEW:

(a)  THE APPLICATION, INCLUDING DOCUMENTATION OF COMPLIANCE WITH ENVIRONMENTAL PERMITS AND LAWS APPLICABLE TO THE FACILITY OVER THE LAST THREE YEARS, INFORMATION REGARDING AN APPROPRIATE ENVIRONMENTAL MANAGEMENT SYSTEM, A DESCRIPTION OF THE CURRENT STATUS OF PROPOSED PERFORMANCE INDICATORS, AND AN OUTLINE OF THE MEASURES BY WHICH THE PROGRAM WILL BE EVALUATED;

(b)  THE DEPARTMENT'S DETERMINATION REGARDING THE APPLICATION; AND

(c)  THE AGREEMENT AS DESCRIBED IN SUBSECTIONS (1) AND (2) OF THIS SECTION.

25­6.7­107.  Termination from the voluntary environmental leadership program. (1)  ANY ENTITY MAY ELECT TO WITHDRAW FROM PARTICIPATION IN THE PROGRAM AT ANY TIME UPON WRITTEN NOTICE TO THE DEPARTMENT.

(2)  THE DEPARTMENT SHALL TERMINATE THE PARTICIPATION OF AN ENTITY IN THE PROGRAM IF A SERIOUS VIOLATION IS DISCOVERED OR OCCURS AND SUCH VIOLATION IS NOT PROPERLY DISCLOSED IN ACCORDANCE WITH THE LAW OR IS NOT CORRECTED OR REMEDIATED IN A TIMELY MANNER TO THE SATISFACTION OF THE DEPARTMENT.

(3)  THE DEPARTMENT MAY CONTINUE THE PARTICIPATION OF AN ENTITY IN THE PROGRAM IF A SERIOUS VIOLATION IS DISCOVERED OR OCCURS AND SUCH VIOLATION IS PROPERLY DISCLOSED IN ACCORDANCE WITH LAW AND IS CORRECTED OR REMEDIATED IN A TIMELY MANNER TO THE SATISFACTION OF THE DEPARTMENT. AN ENTITY'S PARTICIPATION IN THE PROGRAM SHALL BE SUSPENDED FROM THE TIME THE SERIOUS VIOLATION IS DISCOVERED OR OCCURS UNTIL THE TIME THAT IT IS CORRECTED OR REMEDIATED TO THE SATISFACTION OF THE DEPARTMENT.

(4) (a) THE DEPARTMENT SHALL ESTABLISH A PANEL CONSISTING OF MEMBERS FROM THE PUBLIC AT LARGE, ENVIRONMENTAL GROUPS, REGULATED INDUSTRY, AND THE DEPARTMENT, WHICH PANEL SHALL DETERMINE WHETHER AN ENTITY'S PARTICIPATION IN THE PROGRAM SHALL BE TERMINATED IF ONE OR MORE SERIOUS VIOLATIONS ARE DISCOVERED OR OCCURS SUBSEQUENT TO THE DISCOVERY OF THE INITIAL SERIOUS VIOLATION. AN ENTITY'S PARTICIPATION IN THE PROGRAM SHALL BE SUSPENDED FROM THE TIME THE SERIOUS VIOLATION IS DISCOVERED OR OCCURS UNTIL THE TIME THAT IT IS CORRECTED OR REMEDIATED TO THE SATISFACTION OF THE DEPARTMENT.

(b)  THE PANEL SHALL ESTABLISH CRITERIA THAT SET FORTH THE CIRCUMSTANCES UNDER WHICH AN ENTITY'S PARTICIPATION SHALL BE TERMINATED.

(5)  IF THE DEPARTMENT DETERMINES AT ANY TIME THAT AN ENTITY IS FAILING TO COMPLY WITH ANY OF THE REQUIREMENTS OF THE PROGRAM, AND IF, AFTER WRITTEN NOTICE TO THE ENTITY, THE ENTITY DOES NOT COME INTO COMPLIANCE WITHIN A REASONABLE PERIOD OF TIME, THE DEPARTMENT SHALL TERMINATE THE ENTITY'S PARTICIPATION IN THE PROGRAM.

(6)  ALL INCENTIVES PROVIDED BY THE STATE PURSUANT TO SECTION 25­6.7­108 SHALL BE WITHDRAWN UPON TERMINATION OF THE ENTITY'S PARTICIPATION IN THE LEADERSHIP PROGRAM. IF AN ENTITY WITHDRAWS OR IS TERMINATED FROM THE PROGRAM, THE UNUSED INCENTIVES WILL BE FORFEITED.

25­6.7­108.  Incentives provided by the state. (1)  THE EXECUTIVE DIRECTOR SHALL ESTABLISH AND PROVIDE INCENTIVES TO BE GRANTED TO ANY ENTITY THAT COMPLIES WITH ALL OF THE MANDATORY PROGRAM ELEMENTS AND THE PRESCRIBED NUMBER OF ELECTIVE PROGRAM ELEMENTS, AS DETERMINED BY THE DEPARTMENT. ANY SUCH ENTITY MAY SELECT SOME OR ALL OF THE INCENTIVES ESTABLISHED PURSUANT TO THIS SUBSECTION (1). SUCH INCENTIVES MAY INCLUDE, BUT NEED NOT BE LIMITED TO:

(a)  FORMAL PUBLIC RECOGNITION BY THE GOVERNOR AND THE DEPARTMENT;

(b)  GREATER RELIANCE BY THE DEPARTMENT ON THE ENTITY'S SELF­MONITORING, SELF­REPORTING, SELF­CERTIFICATION, OR THIRD­PARTY CERTIFICATION TO DEMONSTRATE CONTINUED COMPLIANCE WITH ENVIRONMENTAL LAWS AND PERMITS;

(c)  ACCELERATION OF REVIEW AND PROCESSING OF PERMIT APPLICATIONS WITHIN THE STATUTORY AND REGULATORY TIME REQUIRED;

(d)  ABILITY TO CONSOLIDATE PERMIT APPLICATIONS FOR EACH FACILITY OF THE ENTITY WITH ONE REPRESENTATIVE FROM THE DEPARTMENT RESPONSIBLE FOR ALL PERMITTING COMMUNICATIONS WITH THE ENTITY;

(e)  CONSOLIDATION AND SIMPLIFICATION OF REPORTING REQUIREMENTS;

(f)  EXTENSION OF TERMS OF ENVIRONMENTAL PERMITS UP TO TEN YEARS IF AUTHORIZED UNDER THE RELEVANT ENVIRONMENTAL LAW; AND

(g)  ABILITY TO OBTAIN ADDITIONAL CREDITS FOR REDUCTIONS IN EMISSIONS OR DISCHARGES THAT EXCEED MINIMUM LEGAL REQUIREMENTS UNDER ANY OPERATING EMISSIONS OR DISCHARGE TRADING OR CREDIT PROGRAM THAT HAS BEEN OR MAY BE ESTABLISHED. THE ADDITIONAL CREDIT GRANTED SHALL RESULT IN A NET IMPROVEMENT TO THE ENVIRONMENT.

(2)  THE EXECUTIVE DIRECTOR SHALL ALSO ESTABLISH AND PROVIDE FINANCIAL INCENTIVES AVAILABLE THROUGH THE PROGRAM. FINANCIAL INCENTIVES SHALL BE GRADUATED IN AMOUNT IN ORDER TO PROVIDE GREATER PROPORTIONAL MONETARY GRANTS OR REBATES TO SMALLER ENTITIES AS DETERMINED BY THE EXECUTIVE DIRECTOR BY THE SIZE OF THE ENVIRONMENTAL BENEFIT PROVIDED BY THE ENTITY'S ACTIONS. NO FINANCIAL INCENTIVES SHALL BE AWARDED UNLESS THE DEPARTMENT HAS FIRST DETERMINED THAT THE ENTITY APPLYING FOR THE FINANCIAL INCENTIVE HAS COMPLIED WITH ALL OF THE MANDATORY PROGRAM ELEMENTS, AND THE PRESCRIBED NUMBER OF ELECTIVE PROGRAM ELEMENTS. ENTITIES MAY ONLY SELECT ONE OF THE FINANCIAL INCENTIVES ESTABLISHED UNDER THIS SUBSECTION (2). THE EXECUTIVE DIRECTOR MAY ESTABLISH THE FOLLOWING ALTERNATIVE FINANCIAL INCENTIVES:

(a)  DOLLAR CREDITS TO BE APPLIED AGAINST FUTURE OBLIGATIONS OF THE ENTITY UNDER STATE ENVIRONMENTAL LAWS, EXCLUDING FINES OR PENALTIES ASSESSED FOR VIOLATIONS OF ENVIRONMENTAL LAWS. THE AMOUNT OF SUCH CREDITS SHALL BE BASED ON THE SIZE OF THE ENTITY, AND THE AMOUNT OF THE TOTAL VERIFIABLE COSTS INVESTED BY THE ENVIRONMENTAL LEADER TO IMPLEMENT THE ELECTIVE ELEMENTS OF THE PROGRAM AND SHALL NOT EXCEED A TOTAL AMOUNT OF TEN THOUSAND DOLLARS IN ANY THREE­YEAR PERIOD.

(b)  DOLLAR REBATES OR CREDITS BASED UPON A PERCENTAGE OF PERMIT AND EMISSION FEES ASSESSED UNDER STATE ENVIRONMENTAL LAWS. PERCENTAGE AMOUNTS ARE TO BE DETERMINED BASED ON THE SIZE OF THE ENTITY.

(3)  THE DEPARTMENT SHALL REQUEST APPROPRIATIONS ANNUALLY FOR ENVIRONMENTAL PROGRAMS THAT REQUIRED ADDITIONAL FUNDING DUE TO THE AWARD OF DOLLAR CREDITS OR REBATES. IF ANNUAL APPROPRIATIONS ARE NOT SUFFICIENT TO PROVIDE FUNDING FOR THESE PROGRAMS, THE DEPARTMENT MAY LIMIT THE AVAILABILITY OF FINANCIAL INCENTIVES.

25­6.7­109.  Environmental leadership pollution prevention revolving fund ­ creation. (1)  THE EXECUTIVE DIRECTOR SHALL ESTABLISH AND ADMINISTER A REVOLVING FUND PROGRAM TO PROVIDE LOW­ OR NO­COST LOANS TO SMALL OR MEDIUM SIZED ENTITIES, AS DEFINED PURSUANT TO SECTION 25­6.7­105 (2), FOR POLLUTION PREVENTION, TOXIC USE REDUCTION, SOURCE REDUCTION, RESOURCE RECOVERY, ENERGY EFFICIENCY, AND INNOVATIVE ENVIRONMENTAL TECHNOLOGY ACTIVITIES. SUCH LOANS SHALL BE FUNDED FROM MONEYS CONTRIBUTED TO THE ENVIRONMENTAL LEADERSHIP POLLUTION PREVENTION FUND CREATED IN SUBSECTION (3) OF THIS SECTION. THE DEPARTMENT SHALL HAVE THE AUTHORITY TO ENTER INTO ONE OR MORE AGREEMENTS WITH OTHER STATE OR LOCAL AGENCIES AS NECESSARY TO IMPLEMENT THE PROVISIONS OF THIS SECTION. FOR PURPOSES OF THIS SECTION, "POLLUTION PREVENTION" SHALL HAVE THE SAME MEANING AS SET FORTH IN SECTION 25­16.5­103 (6).

(2) (a)  THE DEPARTMENT MAY SOLICIT AND ACCEPT GIFTS, DONATIONS, AND GRANTS FOR ANY PURPOSE CONNECTED WITH THE REVOLVING FUND PROGRAM. THE DEPARTMENT SHALL DIRECT THE DISPOSITION OF SUCH PROPERTY SO GIVEN FOR ANY PURPOSE CONSISTENT WITH THE TERMS AND CONDITIONS UNDER WHICH SUCH GIFT, DONATION, OR GRANT WAS MADE.

(b)  IN ADDITION, THE DEPARTMENT MAY ENTER INTO SETTLEMENT AGREEMENTS FOR VIOLATIONS OF ARTICLES 7, 8, 11, AND 15 OF THIS TITLE OR ARTICLE 20 OF TITLE 30, C.R.S., AND SAID SETTLEMENT AGREEMENTS MAY INCLUDE THE PAYMENT OR CONTRIBUTION OF MONEYS TO THE ENVIRONMENTAL LEADERSHIP POLLUTION PREVENTION REVOLVING FUND, CREATED IN SECTION 25­6.7­109 (3).

(3)  THERE IS HEREBY ESTABLISHED IN THE STATE TREASURY A FUND TO BE KNOWN AS THE ENVIRONMENTAL LEADERSHIP POLLUTION PREVENTION REVOLVING FUND, WHICH SHALL CONSIST OF MONEYS MADE AVAILABLE PURSUANT TO LAW AND ALL GIFTS, DONATIONS, AND GRANTS ACCEPTED PURSUANT TO SUBSECTION (2) OF THIS SECTION. SUCH MONEYS SHALL BE DEDICATED TO AND CONTINUOUSLY AVAILABLE FOR THE EXCLUSIVE PURPOSE OF FUNDING THE REVOLVING FUND PROGRAM CREATED PURSUANT TO THIS SECTION. ALL INTEREST DERIVED FROM THE DEPOSIT AND INVESTMENT OF THE FUND SHALL BE CREDITED TO THE FUND. A PORTION OF THE MONEYS IN THE FUND SHALL BE SUBJECT TO ANNUAL APPROPRIATION BY THE GENERAL ASSEMBLY TO THE DEPARTMENT FOR THE PURPOSE OF COVERING THE REASONABLE COSTS OF ADMINISTERING THE REVOLVING FUND PROGRAM ESTABLISHED IN THIS SECTION.

SECTION 2.  25­7­129, Colorado Revised Statutes, 1989 Repl. Vol., is amended to read:

25­7­129.  Disposition of fines and penalties. FIFTY PERCENT OF all receipts from penalties or fines collected under the provisions of sections 25­7­115, 25­7­122, and 25­7­123 shall be credited to the general fund of the state, AND THE REMAINING FIFTY PERCENT SHALL BE CREDITED TO THE ENVIRONMENTAL LEADERSHIP POLLUTION PREVENTION REVOLVING FUND CREATED IN SECTION 25­6.7­109 (3).

SECTION 3.  25­8­608 (1), Colorado Revised Statutes, 1989 Repl. Vol., as amended, is amended to read:

25­8­608.  Civil penalties. (1)  Any person who violates any provision of this article or of any permit issued under this article, or any control regulation promulgated pursuant to this article, or any final cease and desist order or clean­up order shall be subject to a civil penalty of not more than ten thousand dollars per day for each day during which such violation occurs. Any civil penalty collected under this section shall be credited to the general fund. FIFTY PERCENT OF ANY CIVIL PENALTY COLLECTED UNDER THIS SECTION SHALL BE CREDITED TO THE GENERAL FUND AND THE REMAINING FIFTY PERCENT SHALL BE CREDITED TO THE ENVIRONMENTAL LEADERSHIP POLLUTION PREVENTION REVOLVING FUND CREATED IN SECTION 25­6.7­109 (3).

SECTION 4.  25­11­107 (5) (i), Colorado Revised Statutes, 1989 Repl. Vol., is amended to read:

25­11­107.  Prohibited acts ­ violations ­ penalties. (5) (i)  FIFTY PERCENT OF all civil penalties collected pursuant to this subsection (5) shall be transmitted to the state treasurer, who shall credit the same to the general fund, AND THE REMAINING FIFTY PERCENT SHALL BE CREDITED TO THE ENVIRONMENTAL LEADERSHIP POLLUTION PREVENTION REVOLVING FUND CREATED IN SECTION 25­6.7­109 (3).

SECTION 5.  25­15­311, Colorado Revised Statutes, 1989 Repl. Vol., is amended to read:

25­15­311.  Disposition of fines and penalties. FIFTY PERCENT OF all receipts from penalties or fines collected under the provisions of sections 25­15­309 and 25­15­310 shall be credited to the general fund of the state, AND THE REMAINING FIFTY PERCENT SHALL BE CREDITED TO THE ENVIRONMENTAL LEADERSHIP POLLUTION PREVENTION REVOLVING FUND CREATED IN SECTION 25­6.7­109 (3).

SECTION 6.  39­5­131, Colorado Revised Statutes, 1994 Repl. Vol., is RECREATED AND REENACTED, WITH AMENDMENTS, to read:

39­5­131.  Certification and assessment of pollution prevention, toxic use reduction, resource recovery, energy efficiency, and innovative environmental technology investments ­ repeal of section. (1)  BY APRIL 1, 1998, ENVIRONMENTAL LEADERS DESIGNATED UNDER ARTICLE 6.7 OF TITLE 25, C.R.S., SHALL SUBMIT THEIR CERTIFIED EXPENDITURES FOR WHICH THEY ARE SEEKING CREDIT FOR THE PERIOD OF JULY 1, 1997, TO DECEMBER 31, 1997, AND BY APRIL 1 FOR EACH YEAR THEREAFTER SUCH ENVIRONMENTAL LEADERS SHALL SUBMIT THEIR CERTIFIED EXPENDITURES FOR WHICH THEY ARE SEEKING CREDIT FOR THE PRIOR TAX YEAR TO THE DEPARTMENT OF PUBLIC HEALTH AND ENVIRONMENT.

(2)  SUCH ENVIRONMENTAL LEADER SHALL SUBMIT THE FOLLOWING INFORMATION:

(a)  THE ACTUAL NET EXPENDITURE OF THE INVESTMENT AND THE ACTUAL NET EXPENDITURE REQUIRED TO COMPLY WITH THE APPLICABLE ENVIRONMENTAL STATUTE, REGULATION, OR PERMIT;

(b)  A DESCRIPTION OF THE MATERIALS INCORPORATED THEREIN BY REFERENCE, IF APPLICABLE;

(c)  ALL MACHINERY MADE A PART THEREOF, IF APPLICABLE;

(d)  THE EXISTING OR PROPOSED OPERATIONAL PROCEDURE THEREOF, IF APPLICABLE; AND

(e)  A STATEMENT OF THE PURPOSE OF THE POLLUTION PREVENTION, SOURCE REDUCTION, TOXIC USE REDUCTION, RESOURCE RECOVERY, ENERGY EFFICIENCY, OR INNOVATIVE ENVIRONMENTAL TECHNOLOGY INVESTMENT.

(3)  AT ANY TIME AFTER FILING THE REQUEST FOR CERTIFICATION AND PRIOR TO ITS DETERMINATION, THE DEPARTMENT OF PUBLIC HEALTH AND ENVIRONMENT MAY REQUEST FURTHER INFORMATION RELEVANT TO ITS DETERMINATION OF ELIGIBILITY FOR CERTIFICATION.

(4)  ON OR BEFORE JULY 1, 1998, AND ON OR BEFORE JULY 1 OF EACH YEAR THEREAFTER, THE DEPARTMENT OF PUBLIC HEALTH AND ENVIRONMENT SHALL DETERMINE THE ELIGIBILITY OF THE POLLUTION PREVENTION, SOURCE REDUCTION, TOXIC USE REDUCTION, RESOURCE RECOVERY, ENERGY EFFICIENCY, OR INNOVATIVE ENVIRONMENTAL TECHNOLOGY INVESTMENT AND CERTIFY THE AMOUNT OF THE INVESTMENT THAT IS ELIGIBLE FOR THE TAX CREDIT SET FORTH IN SECTION 39­22­508.

(5)  THE ENVIRONMENTAL LEADER SHALL FILE THE CERTIFICATION WITH THE DEPARTMENT OF REVENUE WITH ITS INCOME TAX RETURN FOR THE TAX YEAR FOR WHICH THE CREDIT IS CERTIFIED.

(6)  THE ACTUAL INVESTMENT AMOUNT CERTIFIED SHALL NOT EXCEED THE ACTUAL NET EXPENDITURES INVESTED AND IN ANY TAX YEAR AT A SINGLE BUSINESS LOCATION SHALL NOT EXCEED ONE HUNDRED THOUSAND DOLLARS.

(7)  THE TOTAL AMOUNT CERTIFIED FOR ALL PROJECTS COMPLETED ON OR AFTER JULY 1, 1997, AND ON OR BEFORE DECEMBER 31, 2002, SHALL NOT EXCEED TWENTY­FIVE MILLION DOLLARS, AND THE TOTAL AMOUNT CERTIFIED FOR ANY SINGLE FISCAL YEAR IN SAID TIME PERIOD SHALL NOT EXCEED SEVEN MILLION FIVE HUNDRED THOUSAND DOLLARS.

SECTION 7.  39­22­508, Colorado Revised Statutes, 1994 Repl. Vol., as amended, is RECREATED AND REENACTED, WITH AMENDMENTS, to read:

. 39­22­508.  Credit for environmental leaders for income taxes attributable to pollution prevention, toxic use reduction, source reduction, resource recovery, energy efficiency, and innovative environmental technology investments ­ repeal of section. (1)  THERE SHALL BE ALLOWED TO ALL PARTICIPANTS IN THE ENVIRONMENTAL LEADERSHIP PROGRAM CREATED IN ARTICLE 6.7 OF TITLE 25, C.R.S., A CREDIT AGAINST THE INCOME TAXES IMPOSED BY THIS ARTICLE FOR ANY CERTIFIED POLLUTION PREVENTION, TOXIC USE REDUCTION, SOURCE REDUCTION, RESOURCE RECOVERY, ENERGY EFFICIENCY, OR INNOVATIVE ENVIRONMENTAL TECHNOLOGY INVESTMENT MADE AT THE SPECIFIC OPERATING UNIT, FACILITY, OR ENTIRE ENTITY THAT HAS BEEN DESIGNATED BY THE ENVIRONMENTAL LEADER AS PARTICIPATING IN THE PROGRAM.

(2)  THE TAX CREDIT ALLOWED UNDER THIS SECTION SHALL NOT EXCEED THIRTY PERCENT OF THE DIFFERENCE BETWEEN THE CERTIFIED TOTAL NET EXPENDITURES OF THE POLLUTION PREVENTION, TOXIC USE REDUCTION, SOURCE REDUCTION, RESOURCE RECOVERY, ENERGY EFFICIENCY, OR INNOVATIVE ENVIRONMENTAL TECHNOLOGY INVESTMENT AND THE NET EXPENDITURE TO COMPLY WITH THE APPLICABLE ENVIRONMENTAL STATUTE, REGULATION, OR PERMIT. THE NET EXPENDITURES ELIGIBLE FOR THE TAX CREDIT ESTABLISHED UNDER THIS SECTION SHALL HAVE BEEN MADE AT THE SPECIFIC OPERATING UNIT, ENTITY, OR FACILITY THAT HAS BEEN DESIGNATED AS AN ENVIRONMENTAL LEADER UNDER ARTICLE 6.7 OF TITLE 25, C.R.S.

(3)  IF THE CREDIT ALLOWED BY THIS SECTION EXCEEDS THE TAX OTHERWISE DUE, THE EXCESS CREDIT MAY BE CARRIED FORWARD AND CLAIMED ON SUBSEQUENT TAX YEARS' TAX RETURNS, NOT TO EXCEED FIVE YEARS.

SECTION 8.  Appropriation. In addition to any other appropriation, there is hereby appropriated, out of any moneys in the general fund not otherwise appropriated, to the department of public health and environment, for the fiscal year beginning July 1, 1997, the sum of two hundred thousand dollars ($200,000), or so much thereof as may be necessary, for the implementation of this act.

SECTION 9.  Safety clause. The general assembly hereby finds, determines, and declares that this act is necessary for the immediate preservation of the public peace, health, and safety.