BILL ANALYSIS Ó AB 1647 Page 1 Date of Hearing: May 16, 2012 ASSEMBLY COMMITTEE ON APPROPRIATIONS Felipe Fuentes, Chair AB 1647 (Gordon) - As Amended: May 2, 2012 Policy Committee: Natural ResourcesVote:5-1 Urgency: No State Mandated Local Program: No Reimbursable: No SUMMARY This bill changes the hearing process for alleged waste tire facility and hauling violations from an Office of Administrative Hearing process to an informal hearing process administered by the Department of Recycling and Resources Recovery (Calrecycle). Specifically, this bill: 1)Authorizes Calrecycle to revoke, suspend or deny a waste facility permit or waste tire hauler registration, for up to three years, if, after an informal hearing, the director finds fraud or certain violations. 2)Authorizes Calrecycle to conduct informal hearings for civil liability cases for alleged violation of waste tires laws that have been made by the department through administrative accusations. 3)Establishes mandatory notification procedures and response timelines Calrecycle must follow regarding potential permit revocations, suspensions or denials, administrative accusations and civil liability decisions. FISCAL EFFECT Net costs of a minor, likely absorbable amount to Calrecycle hear cases within given timeframes and provide notices (special fund). (While Calrecycle will face new workload as a result of this bill, it will also see a reduction in current workload resulting from preparation of cases for formal hearing before the Office of Administrative Hearings (OAH), per existing law. The net effect will likely be a near wash.) AB 1647 Page 2 COMMENTS 1)Rationale . The author describes a recent phenomenon of unpermitted, fly-by-night operations that illegally accept waste tires, bale them and export the bales, oftentimes in violation of the laws of the receiving country, where the tires are burned for fuel and derivative products. The author relays reports of permitted waste tire facilities that have seen a nearly 50% drop in the volume of waste tires they receive, presumably because the waste tires are going to illegal operations. The author notes that the current process to address such violations, which requires a formal hearing before the Office of Administrative Hearings, takes at least six months, during which time the illegal waste tire operators continue their illicit activity. The author intends this bill to provide Calrecycle the ability to quickly hear and resolve such matters internally, as it does with violations of solid waste laws. 2)Background . The Office of Administrative Hearings is a quasi-judicial tribunal that hears administrative disputes by providing independent Administrative Law Judges (ALJs) to conduct hearings for state and local government agencies. When there is disagreement with an action intended to be taken by certain government agencies against an individual or business, such as a Calrecylce action against a waste tire facility or hauler, a hearing before OAH may be requested. Calrecycle reports that hearings before OAH occur no sooner than six months after being requested. According to Calrecycle, Californians generate about 44 million waste tires yearly. In the past, most of California's waste tires were deposited in landfills or dumped in illegal tire piles. To reduce such wasteful or illegal disposal, the Legislature enacted in 1990 the Waste Tire Recycling Management Program. Administered by Calrecycle, the program encourages the diversion of waste tires through a number of activities, including: a) Conducting/funding research into new technologies that increase the useful lifespan of tires. AB 1647 Page 3 b) Conducting/funding research into waste tire product development and applications. c) Assessing market demand for waste tire products. d) Assessing market demand for waste tire products. e) Undertaking, on its own and in conjunction with state and local public agencies, waste tire demonstration projects. f) Providing marketing, grants, and technical assistance to business and to state and local public end users of waste-tire products. g) Developing waste tire engineering curriculum for use at universities and in continuing education for professionals. Today, about 75% of waste tires are diverted to other useful purposes, such as incineration in cement kilns and application as paving material. The program is funded by a fee on the sale of each new tire. Currently, the fee is $1.75 per tire, $0.75 of which goes to the Air Pollution Control Fund for use by the Air Resources Board for air pollution activities. The remainder of fee revenues is used by Calrecycle to administer the waste tire recycling program. 3)Support. This bill is supported by Californians Against Waste and the Northern California Industry Association, whose members are subject to Calrecycle regulation. 4)There is no opposition formally registered to this bill. Analysis Prepared by : Jay Dickenson / APPR. / (916) 319-2081 AB 1647 Page 4