BILL ANALYSIS SB 1778 SENATE COMMITTEE ON ENVIRONMENTAL QUALITY Senator S. Joseph Simitian, Chairman 2005-2006 Regular Session BILL NO: SB 1778 AUTHOR: Alarcon AMENDED: April 4, 2006 FISCAL: Yes HEARING DATE: April 24, 2006 URGENCY: No CONSULTANT: Randy Pestor SUBJECT : ALTERNATIVE DAILY LANDFILL COVER SUMMARY : Existing law , under the California Integrated Waste Management Act of 1989: 1) Provides that the use of solid waste for beneficial reuse in the construction and operation of a solid waste landfill, including the use of alternative daily cover (ADC), reduces or eliminates the amount of solid waste disposed, must constitute diversion through recycling, and cannot be considered disposal for purposes of the Act. 2) Requires the California Integrated Waste Management Board (CIWMB) to adopt regulations by December 31, 1997, establishing conditions for use of ADC. This bill : 1) Specifies that ADC composed of woody and green material is not considered diversion and must be included in determining the amount of solid waste that is subject to disposal. 2) Strikes the deadline for adoption of regulations by the CIWMB and clarifies that the CIWMB must adopt or revise regulations by January 1, 2010, establishing conditions for use of ADC. 3) Requires the CIWMB to adopt a schedule for excluding woody and green material ADC from being considered as meeting the diversion requirements of the Act. SB 1778 Page 2 4) Requires the CIWMB to adopt regulations establishing a "market development credit adjustment factor" that enables a jurisdiction to adjust its diversion rate by adding diversion points to its diversion rate for the purchase of compost. The CIWMB must establish a schedule to credit a jurisdiction with a diversion rate adjustment based on the number of tons of compost used by the jurisdiction in a reporting year, and in developing the schedule must consider whether the compost is locally produced. 5) Includes related legislative intent. 6) Makes technical and clarifying amendments. COMMENTS : 1) Purpose of Bill . According to the author, "ADC means cover material other than earthen material placed on the surface of the active face of a municipal solid waste landfill at the end of each operating day to control vectors, fires, odors, blowing litter, and scavenging. The [CIWMB] has approved ten material types to be used as ADC. The use of ADC is not recorded as disposal, instead landfills receive recycling 'credit' for using diverted waste materials as ADC. Currently the [Act] establishes that ADC use is considered diversion through recycling." The author notes that the CIWMB found in 2000 that ADC is "being overused at landfills around the state, representing as much as 23% of the total waste being deposited. Often the driving force behind overuse of ADC is subsidies or diversion credit for recycling. Some landfills are trying to attract as much wood waste as possible, labeling it as 'ADC,' and putting it into the landfill." The author indicates that "SB 1778 directs the [CIWMB] to create a timeline to phase-out a landfill's diversion credit for its [ADC] in order to maximize recycling . . . and creates a diversion credit for the use of compost." 2) Background on ADC and diversion credits . The California SB 1778 Page 3 Integrated Waste Management Act of 1989 requires each city or county source reduction and recycling element to include an implementation schedule that shows a city or county must divert 25% of solid waste from landfill disposal or transformation by January 1, 1995, and must divert 50% of solid waste on and after 2000. In 1996, the Natural Resources Defense Counsel challenged regulations implementing CIWMB's policy allowing diversion credit for ADC and the Sacramento Superior Court held that the regulations were inconsistent with the Act. AB 1647 (Bustamante) Chapter 978, Statutes of 1996, amended the Act to allow ADC diversion credit, require the CIWMB to adopt regulations establishing conditions for use of ADC, and make related changes. ADC materials approved by the CIWMB that can be reported as diversion include ash and cement kiln dust, treated auto shredder waste, construction and demolition waste, compost, green material, contaminated sediment, sludge, and shredded tires. SB 1778 continues to allow ADC diversion credit if the ADC is not comprised of woody and green material. This bill also requires the CIWMB to adopt a schedule for excluding woody and greenwaste ADC from being considered as meeting diversion requirements of the Act, creates a diversion credit, and contains related amendments. 3) Guidance for schedule ? SB 1778 requires the CIWMB to adopt a schedule for excluding ADC woody and green material from the Act's diversion requirements, but does not set a deadline or provide conditions for a schedule (e.g., longer phase-out for those entities with the highest amount of ADC woody and green materials, phase-out tied to achievable alternative diversion programs). SB 411 is similar to SB 1778 (see comment #7 for more information on SB 411). When the committee heard SB 411 (Alarcon) in January, the committee recognized that development of a schedule based on certain conditions should be developed. Also, since revised regulations must be adopted by January 1, 2010, any changes to the diversion requirements should not commence prior to the regulation SB 1778 Page 4 due date. 4) Setting precedent for diversion credit through double-counting . SB 1778 requires the CIWMB to adopt regulations establishing a "market development credit adjustment factor" enabling a jurisdiction to adjust its diversion rate by adding diversion points to its diversion rate for the purchase of compost. While this may be an effort to encourage local governments to use compost, it sets a precedent for those who may want credits for using other diverted materials and results in double-counting. It would be more appropriate to strike the credit procedure and focus on conditions for a schedule (see Comment #3). 5) Support and opposition concerns . Supporters of revising ADC procedures have generally noted that markets for green waste "are being undermined by the use of these materials as landfill cover." Supporters have indicated that use of greenwaste ADC increased 20% from 2001 to 2003, compost production decreased almost 30% during that period, and continued diversion credit for use of greenwaste as ADC threatens the existence of the state's composting industry. According to Sierra Club California, "The purpose of [SB 1778] is to stimulate growth of markets for green material, which can be put to many beneficial uses." Opponents of revising the ADC procedures have generally indicated that it is important for composting markets to be developed first to stimulate greenwaste demand. According to the County Sanitation Districts of Los Angeles County, "ADC programs offer a reliable and cost-effective market for green waste, and have stimulated the development of separate green waste collection programs . . ." According to other opponents, "Restricting the use of green materials in ADC would force landfills, in many cases, to import virgin soils for daily cover rather than recycling a green material already available through solid waste hauling operations." 6) Related legislation . SB 411 (Alarcon) is similar to SB SB 1778 Page 5 1778, except that SB 411 did not allow for a "market development credit adjustment factor." SB 411 was approved by the Senate Environmental Quality Committee January 9, 2006 (5-1), placed on the Senate Appropriations Committee Suspense File January 19, 2006, and returned to the Secretary of the Senate pursuant to Joint Rule 56 January 31, 2006. SB 1345 (Chesbro) revises certain procedures relating to procurement of compost and requires Caltrans to progressively use more compost instead of fertilizer in the state's highway landscape maintenance program. SOURCE : Californians Against Waste SUPPORT : California Biomass Energy Alliance Californians Against Waste Sierra Club California OPPOSITION : Allied Waste, Inc. California Refuse Removal Council California State Association of Counties Desert Valley Disposal, Inc. Inland Empire Disposal Association League of California Cities Los Angeles County Waste Management Association Norcal Waste Systems, Inc. Palm Springs Disposal Services Rainbow Disposal Co. Inc. Republic Services, Inc. (and California divisions Consolidated Disposal, Richmond Sanitary and Taormina Industries) Regional Council of Rural Counties Rural Counties Environmental Services Joint Powers Authority Sanitation Districts of Los Angeles County Solid Waste Association of North America, California Chapters Solid Waste Association of Orange County Waste Management