BILL ANALYSIS Ó AB 1826 Page 1 Date of Hearing: April 28, 2014 ASSEMBLY COMMITTEE ON NATURAL RESOURCES Wesley Chesbro, Chair AB 1826 (Chesbro) - As Amended: April 22, 2014 SUBJECT : Solid waste: organic waste SUMMARY : Requires generators of specified amounts of organic waste to arrange recycling services for that material. EXISTING LAW: 1)Establishes the California Integrated Waste Management Act of 1989, which: a) Specifies a state policy goal that 75 percent of solid waste generated be diverted from landfill disposal by 2020. b) Requires each local jurisdiction to divert 50 percent of solid waste from landfill disposal. c) Requires a commercial waste generator, including multi-family dwellings, to arrange for recycling services and requires local governments to implement commercial solid waste recycling programs designed to divert solid waste from businesses. 2)Establishes the California Global Warming Solutions Act of 2006 (AB 32), which requires the California Air Resources Board (ARB) to: a) Adopt regulations requiring the reporting and verification of statewide greenhouse gas (GHG) emissions. b) Adopt a statewide GHG emissions limit equivalent to 1990 emissions levels by 2020. THIS BILL : 1)Requires businesses that generate organic waste to arrange for recycling services for that material on the following schedule: AB 1826 Page 2 a) Beginning January 1, 2016, a business that generates eight cubic yards or more of organic waste per week; b) Beginning January 2, 1017, a business that generates four cubic yards of organic waste per week; and, c) On and after January 1, 2019, a business that generates one cubic yard or more of organic waste per week. 2)Defines terms used in the bill, including: a) "Business" as a commercial or public entity including, but not limited to, a firm, partnership, proprietorship, joint stock company, corporation, or association that is organized as a non-profit or for-profit entity, or a multifamily dwelling. b) "Organic waste" as food waste, green waste, landscape and pruning waste, non-hazardous wood waste, and food-soiled paper. c) "Organic waste generator" as a business that is subject to the requirements of the bill. 3)Requires organic waste generators to do one of the following: a) Source separate organic waste and subscribe to recycling service that includes collection or self-hauling; or, b) Subscribe to an organic waste recycling service that may include mixed waste processing that specifically recycles organic waste. 4)Requires businesses that contract for landscaping or gardening services to require that the organic waste generated be recycled in compliance with the bill. 5)Specifies that multifamily dwellings of fewer than five units are exempt from the requirements of this bill. 6)Specifies that food waste generated by multifamily dwellings of five or more units is not subject to the requirements of this bill. 7)On and after January 1, 2016, requires each local jurisdiction AB 1826 Page 3 to implement an organic waste recycling program that is appropriate for the jurisdiction and designed to divert organic waste generated by businesses. Specifies that local jurisdictions that have an organic waste recycling program in place prior to January 1, 2016 do not have to implement a new or expanded program. 8) Authorizes local jurisdictions to exempt businesses from the requirements of the bill on a case-by-case basis for specified reasons. 9)Requires local jurisdictions to include specified information relating to the organic waste recycling program in each jurisdiction's annual report to the Department of Resources Recycling and Recovery (CalRecycle). 10)Specifies that if a local jurisdiction adds or expands an organic waste recycling program pursuant to the bill, it is not required to update its source reduction and recycling element or obtain CalRecycle's approval. 11)Specifies that the bill does not limit the authority of a local jurisdiction to adopt requirements that are more stringent than the bill and clarifies that the bill does not modify, limit, or abrogate: a) A solid waste franchise granted by a local government; b) A contract, license, or permit to collect solid waste granted by a local government; or, c) The existing right of a business to sell or donate its recyclable organic waste materials. 12)Requires CalRecycle to identify and recommend actions to address state and federal permitting and siting challenges and to encourage the continued viability of the state's organic waste processing and recycling infrastructure. Requires CalRecycle to cooperate with local government agencies and the solid waste industry to provide assistance and incentives for increasing the feasibility of organic waste recycling. FISCAL EFFECT : Unknown COMMENTS : AB 1826 Page 4 1)This bill . According to the author, "AB 1826 will help California achieve the state's air quality, GHG, and waste reduction goals by diverting organic materials from landfills." 2)Meeting the state's recycling goals . CalRecycle is tasked with diverting at least 75 percent of solid waste statewide by 2020. Currently, organic materials make up one-third of the waste stream and food continues to be the highest single item disposed at over 15 percent of disposal. CalRecycle is also charged with implementing its Strategic Directive 6.1, which calls for reducing organic waste disposal by 50 percent by 2020. According to CalRecycle, significant gains in organic waste diversion are necessary to meet the 75 percent goal and implementing Strategic Directive 6.1. Recycling technologies for organic waste include composting, anaerobic digestion, and other types of processing that generate renewable fuels, energy, soil amendments, and mulch. Other states have taken similar actions, and 23 have banned the disposal of green waste (i.e., yard trimmings and landscape waste) in landfills. Compost and other soil amendments that can be produced from organic materials have been shown to improve soil health by incorporating organic matter, beneficial micro-organisms, and nutrients and reduce the need for chemical pesticides and fertilizers. These products also conserve water by allowing water to penetrate the soil more quickly and decreasing runoff. Recycling organic materials also creates local jobs. According to CalRecycle, composting creates an average of four jobs for every 1,000 tons of material, approximately four times more than landfilling. 3)Waste reduction and GHGs . According to ARB, a total reduction of 80 million metric tons (MMT), or 16 percent compared to business as usual, is necessary to reduce statewide GHG emissions to 1990 levels by 2020. ARB intends to achieve approximately 78 percent of the reductions through direct regulations. ARB proposes to achieve the balance of reductions necessary to meet the 2020 limit (approximately 18 MMT) through a cap-and-trade program. AB 1826 Page 5 The 2012-13 Budget Act authorized the Department of Finance to allocate at least $500 million from cap-and-trade revenue, and make commensurate reductions to General Fund expenditure authority, to support the regulatory purposes of AB 32. The Governor's proposed 2013-14 Budget includes a brief discussion of Administration priorities for investment, emphasizing investments in the transportation and energy sectors from which large reductions in GHG emissions are possible. In addition, areas to be examined during the planning process include sustainable agriculture practices (including the development of bioenergy), forest management and urban forestry, and the diversion of organic waste to bioenergy and composting. ARB's draft three-year investment plan for cap-and-trade revenues includes waste diversion as a funding priority. Recycling organic waste provides significant GHG reductions over landfilling. Composting and other organics processing technologies, including anaerobic digestion, reduce GHGs by avoiding the emissions that would be generated by the material's decomposition in a landfill. Landfill gas is generated by the decomposition of organic materials such as food, paper, wood, and yard waste. Fifty percent of landfill gas is methane, a GHG that is 21 times more efficient at trapping heat than carbon dioxide. While most modern landfills have systems in place to capture methane, significant amounts continue to escape into the atmosphere. According to ARB's GHG inventory, approximately 7 million tons of CO2 equivalent are released annually by landfills. That number is expected to increase to 8.5 million tons of CO2 equivalent by 2020. The Governor's 2014-15 Budget proposal for cap-and -trade revenues, the Cap-and-Trade Auction Revenue Expenditure Plan, requests $30 million for each of the next two years for CalRecycle to support projects designed to increase recycling and composting. The proposal includes $20 million for grants to expand existing or develop new facilities that process organic or recyclable materials. REGISTERED SUPPORT / OPPOSITION : Support American Biogas Council AB 1826 Page 6 Association of Compost Producers Biodegradable Products Institute Bioenergy Association of California Breathe California California Biomass Energy Alliance California Climate and Agriculture Network California Coastal Protection Network California League of Conservation Voters California Resource Recovery Association Californians Against Waste (sponsor) Castaway Solutions Center for Biological Diversity City and County of San Francisco Clean Power Campaign CleanWorld Coalition for Clean Air Community Alliance with Family Farmers Costa Mesa Sanitary District CR&R Environmental Services Ecology Center Environment California Frank M Booth Design Build Co. Global Alliance for Incinerator Alternatives Global Green USA Grassroots Recycling Network Greenaction for Health and Environmental Justice GreenWaste Recovery Harvest Power Inland Empire Disposal Association Los Angeles Alliance for a New Economy Napa Recycling & Waste Services Natural Resources Defense Council NatureWorks, LLC Northern California Recycling Association Peabody Engineering Planning and Conservation League Recology Sierra Club California Solid Waste Association of Orange County Sonoma Compost StopWaste.Org Synergex International US Composting Council Vasko Electric, Inc. AB 1826 Page 7 Opposition California Grocers Association Analysis Prepared by : Elizabeth MacMillan / NAT. RES. / (916) 319-2092