SB 452: The California Beverage Container Recycling and Litter Reduction Act.

(1)Existing law, the California Beverage Container Recycling and Litter Reduction Act, requires the Department of Resources Recycling and Recovery to annually designate convenience zones and requires that at least one certified recycling center that meets certain requirements be located within every convenience zone. Existing law authorizes the department to grant a convenience zone an exemption from certain redemption requirements, including certain dealer and recycling center redemption requirements, based on certain factors. Existing law limits the total number of exemptions that may be granted to 35% of the total number of convenience zones identified as having one or more of those factors applicable.

This bill, if there is a certified recycling center located within one mile of an unserved convenience zone, would require the department to grant that convenience zone an exemption from the redemption requirements and would increase the total number of exemptions that may be granted otherwise to 50% of the number identified as eligible. The bill would require the department to review exemptions every 5 years to determine if each exemption still meets the prescribed exemption criteria.

(2)The act requires dealers within a convenience zone where no recycling location has been established, or within a convenience zone that is unserved for 60 days and not exempt from convenience zone requirements, to submit an affidavit to the department stating that the dealer has met specified standards for redemption, including, among others, that the dealer is redeeming all empty beverage container types at all open cash registers or at one designated location on the dealers premises, during all hours that the dealer is open for business. If the dealer does not submit that affidavit, existing law requires the dealer to pay $100 per day to the department, for deposit in the California Beverage Container Recycling Fund, a continuously appropriated fund described in (3), until a recycling location is established or until the dealer meets the standards for redemption specified in the affidavit provision.

This bill would revise these convenience zone redemption duties and exempt from those duties dealers with gross annual sales of less than $2,000,000 and dealers that are not supermarkets and that have less than 5,000 square feet of interior retail space. The bill, until January 1, 2021, would also exempt certain other dealers from these requirements.

(3)The act establishes the California Beverage Container Recycling Fund and, except for administrative costs, continuously appropriates moneys in the fund to the department for specified purposes, including the amount necessary to pay handling fees to certain types of recyclers to provide an incentive for the redemption of empty beverage containers in convenience zones. The act also continuously appropriates from the fund $15,000,000 annually for payments for curbside programs and neighborhood dropoff programs and $10,500,000 annually for payments to cities and counties for beverage container recycling and litter cleanup activities. The act authorizes the department to withhold beverage container recycling and litter cleanup activities payments to any city, county, or city and county that has restricted or prohibited the siting of a supermarket site, as provided.

This bill would require the department to offer a handling fee payment from the fund to certain certified recyclers within unserved convenience zones. The bill would make an appropriation by changing the terms and conditions under which the department is authorized to make payments from a continuously appropriated fund. The bill, until July 1, 2021, would require the handling fee to be set at the rate in effect on July 1, 2015. The bill would authorize the department, until July 1, 2021, to annually expend $3,000,000 from the fund for specified supplemental handling fee payments to low-volume recycling centers. By authorizing the expenditure of a continuously appropriated fund for new purposes, this bill would make an appropriation. The bill would require the department to develop and submit to the Legislature recommended revisions to the handling fee provisions, as specified. The bill would authorize the department to withhold payments to curbside programs and neighborhood dropoff programs in any city, county, or city and county that has restricted or prohibited the siting of a certified recycling center, as provided. The bill would require the department, on or before July 1, 2019, to convene a public hearing, as specified, for purposes of discussing and receiving public testimony on the development of guidelines for evaluating the circumstances that might prompt the department to withhold beverage container recycling and litter cleanup activities payments to any city, county, or city and county that has restricted or prohibited the siting of a supermarket site.

(4)The act requires the department to pay a market development payment to a reclaimer, as defined, for empty plastic beverage containers that have been collected for recycling in the state, and that the reclaimer washes and processes into flake, pellet, sheet, or any other form that is then usable as input for the manufacture of new plastic products, as defined, by product manufacturers in the state. The act also requires the department to pay a market development payment to a product manufacturer, as defined, for plastic flake, pellet, sheet, or any other form of plastic purchased from a reclaimer and used by that product manufacturer to manufacture a plastic product in the state.

This bill would require the department to pay market development payments to a reclaimer that uses the services of a 3rd party to process the empty plastic beverage containers into a form usable for the manufacture of new plastic products and to a product manufacturer that uses the services of a 3rd party to process the plastic purchased from a reclaimer in manufacturing the plastic product. The bill would clarify that certain moneys are not available for market development payments to these additional product manufacturers. By changing the purposes for which continuously appropriated moneys may be expended, this bill would make an appropriation.

(5)Under the act, the department is required to calculate a processing fee for each beverage container with a specified scrap value, which is required to be paid by beverage manufacturers for each beverage container sold or transferred to a distributor or dealer. The department is required to calculate the processing fee in a specified manner, so that the actual processing fee generally equals 65% of the processing payment that the department is required to pay to processors if the scrap value of the container having a refund value pursuant to the act is less than the cost of recycling. The department is required to determine the statewide weighted average cost to recycle each beverage container type by conducting a survey, as specified. The department is required to establish a processing fee account in the continuously appropriated California Beverage Container Recycling Fund for each material type and to deposit processing fees and other amounts in the applicable account.

This bill would, for purposes of calculating processing payments, require the department, until January 1, 2021, to use the actual cost of recycling that was in effect on December 30, 2015, adjusted as specified. The bill would make an appropriation by changing the terms and conditions under which the department is authorized to make payments from a continuously appropriated fund. The bill would provide that the processing fees established by the department between the effective date of the bill and December 31, 2018, inclusive, shall not be higher than they would be absent these new provisions. The bill would require the department to suspend usage of surveys and calculations of recycling costs until at least January 1, 2020, and would authorize the department to redirect any contract funds for cost surveys and calculations to provide for a specified assessment and to utilize any contract funds available for the development of amendments to be recommended to the Legislature regarding specified provisions of the act.