BILL ANALYSIS                                                                                                                                                                                                    


          |SENATE RULES COMMITTEE            |                    SB 55|
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                                 THIRD READING

          Bill No:  SB 55
          Author:   Corbett (D)
          Amended:  5/20/09
          Vote:     21

          AYES:  Simitian, Corbett, Hancock, Lowenthal, Pavley
          NOES:  Runner, Ashburn

           SENATE APPROPRIATIONS COMMITTEE  :  Senate Rule 28.8

           SUBJECT  :    Recycling:  California redemption value  

           SOURCE  :     Author

           DIGEST  :    This bill deletes the provisions of existing law  
          that require the Department of Conservation (DOC) to  
          establish reporting periods for redemption rates that  
          require DOC to determine redemption rates for specified  
          types of beverage containers.  This bill also deletes the  
          definition of redemption rate.

           Senate Floor Amendments  of 5/20/09 delete the contents of  
          the bill and replace it with the provisions related to the  
          deletion of the obsolete requirement to calculate a  
          redemption rate for beverage containers subject to the  
          California Beverage Container Recycling and Litter  
          Reduction Act.  The DOC must still calculate a recycling  
          rate.  These provisions were heard by the Senate  


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          Environmental Committee on 4/20/09.

           ANALYSIS  :    Under existing law, DOC is required to  
          establish reporting periods of six months each for  
          redemption rates and recycling rates for specified types of  
          beverage containers.  Existing law also requires the DOC to  
          determine the redemption and recycling rates for those  
          beverage containers for each reporting period and to issue  
          a report on those determinations.  Existing law also  
          contains various definitions for those purposes, including  
          redemption rate.


           According to the Senate Environmental Quality Committee  
          analysis, DOC is required to calculate a recycling rate the  
          commonly used ratio of materials recycled divided by  
          materials sold, which is a true indicator of program  
          activities.  The redemption rate calculation considers  
          postfilled food or drink containers (not included in the  
          Act) returned for recycling, in addition to empty beverage  
          containers (included in the Act) returned for recycling.   
          The recycling rate calculation only considers empty  
          beverage containers returned for recycling.  In this  
          respect, the redemption rate does not actually depict the  
          success of the Act because it includes material that is  
          outside of its scope.

          The author's office notes that when the law was first  
          enacted, glass and PET beverage container manufacturers  
          operated monopoly programs for the processing of their  
          containers.  The law contained an automatic trigger that  
          would result in an increase in refund value if a specified  
          return rate was not achieved.  In order to ensure that the  
          beverage containers continued to promote the recycling of  
          all glass and PET (crv and non-crv), the redemption rate  
          formula was developed in order to provide a modest  
          incentive to support all containers recycling.  The initial  
          trigger used a 65 percent redemption rate.

          Today, the triggers have been eliminated and the beverage  
          container manufacturers no longer have an exclusive  
          monopoly on processing.  There is no longer any legal or  
          practical justification for DOC to calculate a redemption  



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          rate.  The continued existence of the calculation only  
          causes confusion among the public and other program  
          observers as to what the correct return rate is.

           FISCAL EFFECT  :    Appropriation:  Yes   Fiscal Com.:  Yes    
          Local:  Yes

           SUPPORT  :   (Verified  5/12/09)

          Allan Company
          Californians Against Waste
          Institute of Scrap Recycling Industries
          Tomra Pacific, Inc.

          TSM:cm  5/22/09   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  SEE ABOVE

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