The lead sponsor of a bill to loosen environmental regulations on Louisville industrial companies regulated by air pollution control boards came under scrutiny from a fellow Kentucky lawmaker Thursday.

House Bill 136 from Rep. Jared Bauman, R-Louisville, would relax regulations of Kentucky chemical and industrial companies in Jefferson County by, for instance, making it “voluntary” for the operators of such facilities to disclose results of an environmental audit.

It also would keep confidential by way of an “environmental audit privilege” the communication between those companies and the entities that regulate them.

Bauman’s bill would also prevent Louisville’s Air Pollution Control District from levying fines against a company for violating rules, orders, or administrative regulations. These fines help fund county-wide air quality programs and enforcement.

The question from a Kentucky lawmaker: Could the company Bauman works for benefit from the bill he introduced?

As Bauman put it to fellow members of the House Standing Committee on Natural Resources and Energy Thursday morning, the “purpose of the bill is to allow for good actors within Jefferson County (who) self-report environmental incidents, so long as they make that reporting timely and make necessary corrections to correct the issue.”

In other words, if a company violates a state or federal environmental rule, but self-reports it within a set amount of time, they are potentially immune from any civil penalty.

Bauman is the operational excellence manager for the Lubrizol Corporation, according to his financial disclosure form submitted to the Legislative Ethics Commission.

Lubrizol Advanced Materials, a chemical company, isin West Louisville in an area known as “Rubbertown,” a highly polluted area named named for the tire and synthetic rubber plants that used to dot the swath of neighborhoods along the Ohio River.

In the early 2000s, a city-commissioned study found unacceptably high levels of toxic air pollutants, and in 2005, a series of regulations through the Strategic Toxic Air Reduction Program were implemented. While air quality levels have improved, it remains one of the more polluted neighborhoods in Kentucky’s largest city.

Bauman’s LinkedIn account shows he has worked at the Lubrizol Corporation for 13 years. His place of work falls under the regulatory authority of Louisville’s Air Pollution Control District and would potentially be positively impacted by this bill — a point raised by Rep. Beverly Chester-Burton, D-Louisville, at Thursday’s committee meeting.

“Are you affiliated or would you benefit from any of this action, or work for a company that would benefit from this action?” Chester-Burton asked Bauman.

Bauman replied: “So, I guess I don’t really know how to answer that. I do work in industry in Louisville. Before ever pursuing this bill, I contacted our ethics division to get an opinion, and they cleared that it was absolutely compliant with the ethics policy that I move forward with this bill.”

Chester-Burton then asked the name of his company. “I don’t think that’s relevant,” Bauman answered.

Later in the meeting, Rep. Daniel Grossberg, D-Louisville, asked, “Is there anyone else on the committee who might benefit through other employment with the passage of this bill?”

Committee chairman Rep. Jim Gooch, R-Providence, ignored the question.

“I don’t think that’s in order, because we can all pass legislation, propose legislation as long as that legislation affects everyone,” he said. “I don’t think that’s a relevant question, so I’m not going to go there.”

In explaining the benefits of the bill, Bauman said putting control back in the hands of companies to self-report will actually make them more likely to disclose potential wrongdoing.

“Giving them that privilege actually promotes more reporting than hiding those issues,” he said.

“I’m not going to buy the argument that people will just self report and police. That’s why we have to have these regulations,” said Rep. Lindsey Burke, D-Lexington, who voted against the bill at the end of the meeting. “What will prevent Louisvillians in the ‘Rubbertown’ area from experiencing a return to the place we don’t want them to be?”

Bauman added, “What we’re doing with this bill is giving industry in Jefferson County the same environmental reporting privilege as the other 119 counties in the state of Kentucky.”

But that reporting privilege, drawn by statute passed in 1994, resulted in the Environmental Protection Agency “issuing a notice of deficiency, alleging that it unduly restricted Kentucky’s ability to adequately administer and enforce criminal (and) civil penalties,” said Audrey Ernstberger, staff attorney and lobbyist with the Kentucky Resources Council.

That council opposes the bill in its current form for several reasons, Ernstberger said.

“It could reward bad behavior that puts community health at risk,” and it may “disincentivize industries from taking steps to eliminate violations, seeing as they won’t face penalty” if they’re self-reported.

The proposal, she said, could “further perpetrate environmental injustices.”

Ernstberger said allowing for “environmental audit privilege,” — essentially a “safeguard for industries” — may prevent regulatory agencies from using audit reports showing environmental non-compliance against the companies that have been non-compliant.

She also said passing the law in its current form could also compromise Kentucky’s ability to regulate the air quality of companies under the U.S. Clean Air Act.

And those authorities that permit and regulate are also required, under federal law, to collect fines for non-compliance — something this bill would potentially impede, Ernstberger said.

HB 136 passed on a party-line vote, with all Republicans voting in favor, on Thursday and now heads to the House.

Herald-Leader reporter Austin Horn contributed to this report.