BILL ANALYSIS SB 50 Page 1 Date of Hearing: August 25, 2004 ASSEMBLY COMMITTEE ON NATURAL RESOURCES Hannah-Beth Jackson, Chair SB 50 (Sher) - As Amended: August 23, 2004 SENATE VOTE : 37-0 SUBJECT : Electronic waste. SUMMARY : Makes a number of clarifying changes to the Electronic Waste Recycling Act (Act) of 2003 [SB 20 (Sher), Chapter 526, Statutes of 2003]. EXISTING LAW : 1)Provides that the Department of Toxic Substances Control (DTSC) may, by regulation, establish management standards on the management of electronic waste that the DTSC determines is hazardous or if the Federal Government authorizes an alternative management standard for electronic waste. 2)Defines "covered electronic device" as a cathode ray tube, cathode ray tube device, flat panel screen, or any other video display device with a screen size that is greater than four inches in size measured diagonally and which, when discarded or disposed, would be a hazardous waste under regulations set by the DTSC. 3)Defines "authorized collector" as any of the following: a) A city, county or district that collects covered electronic devices. b) A person or entity that is required or authorized by a city, county, or district to collect covered electronic devices. c) A non-profit organization that collects or accepts covered electronic devices. d) A manufacturer that collects, consolidates, and transports covered electronic devices for recycling from consumers, businesses, institutions, and other generators. SB 50 Page 2 e) Any entity that collects, handles, consolidates, and transports covered electronic devices. 4)Requires DTSC to adopt regulations that prohibit an electronic device from being sold or offered for sale if the electronic device is prohibited from being sold or offered for sale in the European Union, as specified. a) Provides that the regulations shall take effect January 1, 2007 or on or after the date the European Union directive is adopted, as specified. 5)On and after April 1, 2004, imposes an electronic waste recycling fee (Fee) upon the purchase of an electronic device by a consumer from a retailer in the following amounts: a) Six dollars ($6) for each electronic device with a screen size of less than 15 inches measured diagonally. b) Eight dollars ($8) for each electronic device with a screen size greater than or equal to 15 inches but less than 35 inches measured diagonally. c) Ten dollars ($10) for each electronic device with a screen size greater than or equal to 35 inches measured diagonally. 6)Provides that the California Integrated Waste Management Board (CIWMB) shall review and adjust the Fee at least every two years in a public hearing. 7)Requires the CIWMB to base any Fee adjustments on the following factors: a) The sufficiency, and any surplus, of revenues in the account to fund the collection, consolidation, and recycling of 100 percent of the covered electronic waste that is projected to be recycled in the state. b) The sufficiency of revenues in the account. 8)On and after January 1, 2005, prohibits the sale of covered electronic devices that are not labeled with the name of the manufacturer or the manufacturer brand label that is readily visible. SB 50 Page 3 9)On and after July 1, 2005, requires manufacturers of electronic devices to annually submit a report to the CIWMB that includes the following information: a) An estimate of the number of covered electronic devices sold by the manufacturer in the state during the previous year. b) A baseline or set of baselines that show the amount of hazardous materials used in the manufacture of electronic devices by the manufacturer in that year and the reduction in the use of those hazardous materials from the previous year. c) A baseline or set of baselines that show the amount of recycled materials used in the manufacture of electronic devices by the manufacturer in that year and the increase in the use of those recycled materials from the previous year. d) A baseline or set of baselines that describe any efforts to design covered electronic devices for recycling and goals and plans for further increasing design for recycling. e) Any other information determined to be necessary by the CIWMB to ensure compliance with the Act. 10)Requires manufacturers to make information available to consumers that describes where and how to return, recycle, and dispose of the covered electronic devices and opportunities and locations for the collection or return of the covered electronic devices and provides information to consumers on the electronic waste recycling fee. 11)On and after April 1, 2004, requires manufacturers to inform retailers if a covered electronic device sold by that manufacturer is subject to the recycling fee under the Act. 12)Provides that the imposition of the fee is a matter of statewide importance and preempts local agencies from enacting similar fees, but provides that local agencies may adopt, implement or enforce local ordinances, resolutions, regulations or rules governing curbside or drop off recycling SB 50 Page 4 programs. 13)Authorizes the CIWMB to impose administrative civil penalties of up to $2,500 per violation, and to seek civil penalties of up to $5,000 per violation. 14)Establishes procedures for the CIWMB to administer the Act. 15)Provides that DTSC may adopt emergency regulations that are necessary to implement the Act and any other regulations DTSC deems necessary enforce the Act. 16)Requires the CIWMB to convene an electronic waste working group comprised of representatives from manufacturers of electronic devices and other interested parties to develop and, by July 1, 2005, advise the CIWMB and State and Consumer Agency on environmental purchasing criteria that may be used by state agencies to identify electronic devices with reduced environmental impacts. 17)Requires the CIWMB to annually establish, and update as necessary, statewide recycling goals for covered electronic waste. 18)Requires the CIWMB to annually report to the Legislature and the public on the amount of covered electronic devices sold in the state in the previous year. 19)Requires the CIWMB to annually report to the Legislature and the public on the amount of covered electronic devices recycled in the state in the previous year. 20)Establishes the Electronic Waste Recovery and Recycling Account (Account), within the Integrated Waste Management Account into which Fee or penalty revenues shall be deposited, and specifies how those funds may be spent by the CIWMB. 21)Provides that the CIWMB may spend funds in the Account to: a) Make electronic waste recovery payments to authorized collectors. b) Make electronic waste recycling payments to covered electronic waste recyclers. SB 50 Page 5 c) Provide for administrative costs of the CIWMB. d) Provide funding to DTSC to implement the Act and any regulations adopted by DTSC to implement the Act. 22)Provides that the CIWMB may use no more than 1 percent of the funds annually deposited into the Account for a public information program to educate the public. 23)Provides that the CIWMB may not provide funds for electronic devices unless the materials will be handled in compliance with all statutes and regulations regarding the export of hazardous wastes. 24)Requires any person intending to export a covered electronic waste to a foreign destination, 60 days prior to the export: a) Notify DTSC of the destination, contents, and volume of covered electronic waste to be exported. b) Demonstrate that any applicable law or regulation of the country of destination does not prohibit the importation of covered electronic waste. c) Demonstrate that the export is conducted only in accordance with international law. d) Demonstrate that the management of the exported covered electronic will be handled within the country of destination in accordance with applicable rules adopted by the Organization for Economic Co-operation and Development for the environmentally sound management of electronic waste. e) Demonstrate that the covered electronic waste is being exported for the purpose of reuse or recycling. 25)Requires on and after July 1, 2004, and on July 1 every two years thereafter, the CIWMB shall establish an electronic waste recovery payment schedule for electronic waste generated to cover the net cost for an authorized collector to operate a free and convenient system for collecting, consolidating and transporting electronic waste. 26)Requires on and after January 1, 2004, and on January 1 every SB 50 Page 6 two years thereafter, the CIWMB shall establish an electronic waste recycling payment schedule to cover an electronic waste recyclers net cost to receive, process, and recycle an electronic device from an authorized collector. 27)Provides that the CIWMB shall make electronic recycling recovery payments and electronic waste recycling payments for the collection and recycling of covered electronic waste to an authorized collector or covered electronic waste recycler. 28)Requires electronic waste recyclers to certify to the CWIMB that the electronic waste recycler is in compliance with specified requirements. 29)Prohibits state agencies from procuring covered electronic devices unless the manufacturer demonstrates compliance with the aforementioned provisions. 30)Provides that the CIWMB shall not implement the bill's provisions if a federal law is enacted that meets similar standards to those provided under the bill, or if a court enters a final judgement that holds that the fee imposed on manufacturers under the bill is not applicable to out-of-state manufacturers. Makes findings and declarations relative to electronic waste products, and defines specified terms used in the bill. THIS BILL : 1)Requires the Department of Toxic Substances Control (DTSC) to adopt regulations for determining whether an electronic device, when discarded, is not a hazardous waste. 2)Requires DTSC to adopt regulations to identify electronic devices that DTSC determines are presumed to be, when discarded, a hazardous waste. 3)Requires manufacturers of covered electronic devices, by August 1, 2005, and April 1, annually thereafter to report to retailers whether a device is a covered electronic device for purposes of the Act. 4)Requires a covered electronic device identified in regulations to be subject to the Act on and after November 1, 2004. SB 50 Page 7 5)Revises the definitions of "covered electronic waste," "person," "retailer," and "retail sale," and defines the terms "discarded," "recycling," "refurbished," "vendor," and "video display device". 6)Revises the procedures for the review and adjustment of the covered electronic waste recycling fee (fee). 7)Beginning January 1, 2005, requires the State Board of Equalization (BOE) to collect the fee under the Fee Collection Procedures Law. 8)Requires the fee to be due and payable to BOE quarterly on or before the last day of the month following each calendar quarter. 9)Prohibits, on and after January 1, 2005, the sale of a new or refurbished covered electronic device for sale in California unless the device is labeled with the name of the manufacturer so that it is readily visible. 10)Allows funds in the Electronic Waste Recovery and Recycling Account (Account) to be continuously appropriated to reimburse BOE for its costs associated with registration, collection, overpayment refunds, and auditing retailers, to make electronic waste recovery payments and electronic waste recycling payments, and to provide funds to DTSC to implement and enforce the hazardous waste control law, with regard to electronic waste devices. 11)Establishes the Electronic Waste Penalty Subaccount in the Account, to collect fines and penalties. 12)Provides the California Integrated Waste Management Board (CIWMB) shall adopt regulations specifying cancellation methods for recovery, processing or recycling of covered electronic waste. 13)Provides that CIWMB may pay an electronic waste recycling payment or electronic waste recovery payment for covered electronic waste only if all of the following conditions are met: a) The covered electronic waste, including any residuals SB 50 Page 8 from the processing of the waste, is handled in compliance with all applicable statutes and regulations; b) The manufacturer or the authorized collector or recycler of the electronic waste provide a cost free and convenient opportunity to recycle electronic waste; c) The covered electronic waste is not exported out of state; d) If the covered electronic waste is processed, the covered electronic waste is processed in this state according to the cancellation method authorized by the CIWMB; and, e) If the covered electronic waste is recycled, the covered electronic waste is recycled within the state. 14)Clarifies the standards for exporting covered electronic waste or covered electronic devices to another state or foreign country. 15)Mandates a loan from General Fund or Special Funds for up to $30 million to cover the costs of implementing the Act, including providing payments to recyclers and collectors. 16)Adds an urgency clause. 17)Makes technical and clarifying changes to the Act. FISCAL EFFECT : According to the Assembly Appropriations Committee, minor costs and savings to both DTSC and CIWMB resulting from the various modifications to the electronic waste program and the entities' administration of the program. COMMENTS : According to information from CIWMB and DTSC Web sites: "E-waste is a popular, informal name for electronic products nearing the end of their 'useful life.' Computers, televisions, VCRs, stereos, copiers, and fax machines are common electronic products. Many of these products can be reused, refurbished, or recycled. Unfortunately, electronic discards is one of the fastest growing segments of our nation's waste stream. In addition, some researchers estimate that nearly 75 percent of old electronics are in storage, in part because of the uncertainty over how to manage the materials. Combine this SB 50 Page 9 with increasing advances in technology and new products headed towards the market and it is no wonder that E-waste is a popular topic." The National Safety Council estimates that more than 27 million televisions and 26 million computer monitors will be sold in the United States this year alone, with a projection that some 500 million personal computers will be obsolete by 2007. Californians are expected to throw away approximately 30 million old computers and television monitors in the next few years. The Act set up a system to encourage the recycling of e-waste. Through a system of fees on e-waste being sold in California and payments to e-waste collectors and recyclers who provide free and convenient recycling opportunities to consumers, we now have the basic structure of a recycling program to work with. REGISTERED SUPPORT / OPPOSITION : Support None on file Opposition None on file Analysis Prepared by : Kyra Emanuels Ross / NAT. RES. / (916) 319-2092 FN: 0007955