BILL ANALYSIS Ó
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
AB 341 (Chesbro)
Hearing Date: 08/25/2011 Amended: 07/07/2011
Consultant: Brendan McCarthy Policy Vote: EQ 6-1
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BILL SUMMARY: AB 341 requires the Department of Resources
Recycling and Recovery to increase the diversion of solid waste
from the currently required level of 50 percent to 75 percent by
2020. The bill requires certain businesses to arrange for
recycling services and requires local governments to implement a
commercial recycling program. The bill also makes a number of
technical and procedural changes to the laws governing solid
waste facility regulation.
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Fiscal Impact (in thousands)
Major Provisions 2011-12 2012-13 2013-14 Fund
Cost to implement Absorbable within existing
resourcesSpecial *
commercial recycling
Cost to further increase Unknown costs, potentially in
the millions Special *
the diversion rate to 75% per year
Reduced fee revenues Up to $20,000 per year by 2020 Special
*
* Integrated Waste Management Account.
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STAFF COMMENTS: SUSPENSE FILE.
Under current law, local governments are required divert 50
percent of solid waste through source reduction, recycling, and
composting. The Department of Resources Recycling and Recovery
is required to determine whether local governments are in
compliance with this requirement. Local governments that are not
in compliance or are not making a good faith effort to come into
AB 341 (Chesbro)
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compliance are subject to fines.
Current law authorizes the Department to designate local
enforcement agencies to permit solid waste facilities and
enforce permit or other requirements. Current law requires local
governments to adopt and submit non-disposal facility elements
to the Department. These non-disposal facility elements must
include a description of new facilities and expansions of
existing facilities and all solid waste facility expansions that
recover for reuse more than five percent of total disposed
volume.
AB 341 requires local governments to update existing
non-disposal facility elements as conditions change and provide
that information to the Department.
The bill requires the Department to "ensure" that 75 percent of
generated solid waste is diverted through source reduction,
recycling, or composting. The bill prohibits the Department from
imposing any enforceable requirements on cities or counties.
The bill requires businesses that contract for solid waste
disposal and generate more than four cubic yards of solid waste
and recyclable materials per week or is a multifamily
residential dwelling of five or more units to arrange for
recycling services. Such businesses are required to either
separate recyclable materials from solid waste and arrange for
their collection, or to contract with a recycling service that
provides mixed waste processing services. The bill requires
local governments to implement a commercial recycling program,
unless a jurisdiction already has established such a program.
The Department is required to review such local commercial
recycling programs.
Staff notes that under authority granted pursuant to AB 32
(Nunez, Chapter 488, Statutes of 2006), the Air Resources Board
is administratively considering commercial recycling
requirements. The Air Resources Board is expected to vote on the
proposed regulation in October of this year. The Department
would then implement the regulation.
The bill also makes a variety of technical changes to the code
sections governing solid waste.
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According to the Department, the cost to oversee commercial
recycling requirements can be accommodated within existing
resources.
Because the bill requires the Department to "ensure" that the
statewide diversion rate increases to 75 percent, while
prohibiting the Department from imposing requirements on local
governments, the bill will likely create substantial cost
pressure on the Department. The current statewide diversion rate
is 65 percent. (However, this diversion rate partially reflects
reduced disposal in landfills due to reduced economic activity
caused by the economic downturn. As the economy recovers, waste
generation and disposal rates will likely increase and hence the
diversion rate is expected to drop closer to 60 percent.)
Requiring commercial recycling should increase the diversion
rate, probably to between 65 and 70 percent. Further increasing
the diversion rate to 75 percent will likely require the
Department to create incentives for local governments,
businesses, or individuals to encourage additional source
reduction, recycling, or composting. Alternatively, the
Department may adopt regulations directly on such entities to
require additional source reduction or recycling. The bill does
not include specific actions required by the Department to
achieve the increased diversion rate. The costs for the
Department to achieve the increased diversion rate are unknown,
but could be substantial, particularly if the Department elects
to use grant programs to incentivize additional diversion.
The Department collects a "tipping fee" of $1.40 per ton of
solid waste disposed of in the state. This fee is capped in
statute. Staff estimates that increasing diversion rates from
the about 60 percent (see above) to 75 percent, as required in
the bill, will reduce tipping fee revenues by about $20 million
per year by 2020. Staff also notes that the Integrated Waste
Management Account has a structural deficit of about $8 million
in the budget year and a projected year end fund balance of only
$6.2 million.
While the bill imposes state mandates on local governments,
those mandates are not reimbursable because local governments
are authorized to levy fees to pay for the costs required under
the bill.
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SB 1020 (Padilla, 2007) would have required the Integrated Waste
Management Board to develop a plan to achieve a 75 percent
diversion rate by 2020. That bill was held in the Assembly
Appropriations Committee.
SB 25 (Padilla, 2010) would have increased the required
diversion rate to 60 percent by 2015 and also generally required
businesses to contract for recycling services. That bill was
held in the Assembly Natural Resources Committee.
AB 479 (Chesbro, 2009) was substantially similar to this bill.
AB 479 was held on this committee's suspense file.
AB 737 (Chesbro, 2009) would have implemented a commercial
recycling program and required the Department to report to the
Legislature on potential strategies to achieve a 75 percent
diversion rate. That bill was vetoed by Governor Schwarzenegger.
AB 818 (Blumenfield) requires owners of multifamily residential
buildings to provide recycling services. That bill is in the
Assembly and pending concurrence in Senate amendments.