BILL ANALYSIS Ó
Senate Appropriations Committee Fiscal Summary
Senator Kevin de León, Chair
SB 529 (Leno) - Recycling: fast food facilities.
Amended: April 8, 2013 Policy Vote: EQ 5-3
Urgency: No Mandate: No
Hearing Date: May 23, 2013 Consultant: Marie Liu
SUSPENSE FILE. AS PROPOSED TO BE AMENDED.
Bill Summary: SB 529 would require fast food facilities to only
distribute food in recyclable or compostable packaging beginning
on July 1, 2014.
Fiscal Impact:
Ongoing costs of at least $600,000 from the Integrated
Waste Management Fund (special fund) beginning in FY 2013-14
for the collection and reporting of recycling and composting
rates and availability of residential collection programs.
Likely minor ongoing costs to enforce the packaging and bag
prohibition.
Proposed Law: Beginning July 1, 2014, this bill would prohibit
fast food facilities from distributing disposable food service
packaging or a single-use carryout bag to a consumer except if
the packaging or bag is compostable or recyclable.
Beginning July 1, 2016, the exemption would only apply to
packaging or bags that have demonstrated to the Department of
Resources Recycling and Recovery (CalRecycle) to have a rate of
recovery for composting or recycling of 25% or more. This
requirement increases to 50% on July 1, 2018 and to 75% on July
1, 2020.
This bill also defines compostable and recyclable packaging
based on whether that packaging is accepted for composting or
recycling in a residential collection program available to at
least 60 percent of the households in the jurisdiction in which
the packaging is distributed, as determined by CalRecycle.
Violators of this bill would be subject to civil penalties of up
to $100 for each day the person is in violation up to an annual
maximum of $10,000. Penalty or fines would be deposited into the
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Marine Pollution Reduction Account within the Integrated Waste
Management Fund and may be expended, upon appropriation by the
Legislature, to provide public education, assist local
government's efforts to reduce plastic waste and marine debris,
and for CalRecycle's costs in implementing this bill.
Staff Comments: This bill would require CalRecycle to collect a
large amount of data both to determine the availability of
residential collection programs for each "jurisdiction" in the
state the purpose of defining compostable and recyclable
packaging and to determine actual composting or recovery rates
for compliance with the bill's recovery goalposts. The bill is
unclear whether the recovery rates are statewide or by
jurisdiction and what is the definition of jurisdiction. As the
data will need to be collected in a manner that allows for local
analysis, the definition for jurisdiction will impact costs.
This would be new data collection as CalRecycle has no existing
datasets from which this information can be derived. Data
collection and reporting will likely cost at least $600,000.
This bill specifies that the recovery rates are based packaging
or bag type. However, it is unclear whether the intent is for
the rates to be based on the recovery of all materials of that
type or just fast food packaging of that type. For example, take
thermoformed PET which is used to make items including clam
shells, bakery trays, and cups. For example, if all thermoformed
PET containers, regardless of where it was distributed, was
recovered at a rate of 30%, but thermoformed PET containers
distributed at fast food facilities were only recovered at a
rate of 5%, would there be compliance with the bill?
CalRecycle's enforcement responsibilities, and therefore
enforcement costs, under this bill are unclear. The bill does
not explicitly require CalRecycle to conduct any enforcement
activities nor does it explicitly give CalRecycle the authority
to take enforcement actions such as conducting inspections,
ordering audits, requiring self-certification. Assuming the
author's intent is for CalRecycle to only respond to complaints,
similar to the existing statutory requirement that large
retailers operate plastic bag recycling programs, than
enforcement costs are likely to be minor.
The penalties assessed for violations of this bill would be
placed in the Marine Pollution Reduction Account in the
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Integrated Waste Management Fund where it would be available to
fund CalRecycle's implementation costs as well as public
education and local government assistance to reduce plastic
waste and marine debris. Staff notes that allowing program
implementation to be paid for by fines and penalties can be a
perverse incentive for CalRecycle to be overly aggressive in
enforcing these provisions. However, requiring the Legislature
to appropriate these monies does create some separation between
penalty revenues and program funding.
Proposed Author Amendments: Expand allowable types of packaging,
delay implementation until 2015, require a fast food franchise
to demonstrate compliance with packaging requirements.