Amended in Senate April 4, 2013

Senate Bill No. 791

Introduced by Senator Wyland

February 22, 2013

begin delete An act to amend Section 14501 of the Public Resources Code, relating to beverage containers. end delete begin insert An act to amend Section 7360 of the Revenue and Taxation Code, relating to taxation, to take effect immediately, tax levy. end insert

LEGISLATIVE COUNSEL’S DIGEST

SB 791, as amended, Wyland. begin delete Beverage containers: recycling. end delete begin insert Motor vehicle fuel tax: rate adjustment. end insert

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Existing law, as of July 1, 2010, exempts the sale of, and the storage, use, or other consumption of, motor vehicle fuel from specified sales and use taxes and increases the excise tax on motor vehicle fuel, as provided. Existing law requires the State Board of Equalization to annually adjust the excise tax rate for the state’s next fiscal year so that the revenues from the sales and use tax exemption and motor vehicle fuel excise tax increase are revenue neutral.

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This bill would eliminate the requirement that the State Board of Equalization adjust the rate of the excise tax on motor vehicle fuel, and instead would require the Department of Finance to annually calculate that rate and report that calculated rate to the Joint Legislative Budget Committee. The rate for the state’s next fiscal year would remain the same as the rate of the current fiscal year or would decrease, as provided. This bill would further state that the rate may increase upon a further act by the Legislature.

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This bill would take effect immediately as a tax levy.

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Under existing law, the Division of Recycling within the Department of Resources Recycling and Recovery administers the California Beverage Container Recycling and Litter Reduction Act.

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This bill would make a conforming change to the act’s statement of legislative intent with regard to that authority.

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Vote: majority. Appropriation: no. Fiscal committee:  begin delete no end delete begin insert yes end insert . State-mandated local program: no.

The people of the State of California do enact as follows:

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begin insert SECTION 1. end insert   

end insert

begin insert Section 7360 of the end insert begin insert Revenue and Taxation Code end insert
begin insert is amended to read: end insert

7360.  

(a) (1) A tax of eighteen cents ($0.18) is hereby imposed
upon each gallon of fuel subject to the tax in Sections 7362, 7363,
and 7364.

(2) If the federal fuel tax is reduced below the rate of nine cents
($0.09) per gallon and federal financial allocations to this state for
highway and exclusive public mass transit guideway purposes are
reduced or eliminated correspondingly, the tax rate imposed by
paragraph (1), on and after the date of the reduction, shall be
recalculated by an amount so that the combined state rate under
paragraph (1) and the federal tax rate per gallon equal twenty-seven
cents ($0.27).

(3) If any person or entity is exempt or partially exempt from
the federal fuel tax at the time of a reduction, the person or entity
shall continue to be so exempt under this section.

(b) (1) On and after July 1, 2010, in addition to the tax imposed
by subdivision (a), a tax is hereby imposed upon each gallon of
motor vehicle fuel, other than aviation gasoline, subject to the tax
in Sections 7362, 7363, and 7364 in an amount equal to seventeen
and three-tenths cents ($0.173) per gallon.

(2)  begin insert (A) end insert begin insert   end insert For the 2011-12 fiscal year and each fiscal year
thereafter, the begin delete board end delete begin insert Department of Finance end insert shall, on or before
March 1 of the fiscal year immediately preceding the applicable
fiscal year, begin delete adjust end delete begin insert calculate end insert the rate begin delete in paragraph (1) in end delete that begin delete manner
as end delete begin insert would be required end insert to generate an amount of revenue that will
equal the amount of revenue loss attributable to the exemption
provided by Section 6357.7, based on estimates made by the begin delete board,
and that rate shall be effective during the state’s next fiscal year. end delete
begin insert Department of Finance. end insert

begin insert

(B) The Department of Finance shall report, on or before March
1, 2014, and each March 1 thereafter, the rate calculated pursuant
to subparagraph (A) to the Joint Legislative Budget Committee.

end insert begin insert

(i) If the Department of Finance finds that the calculated rate
is equal to or less than the rate of the current fiscal year, the
calculated rate shall be the rate that is effective during the state’s
next fiscal year.

end insert begin insert

(ii) If the Department of Finance finds that the calculated rate
is greater than the rate of the current fiscal year, the rate effective
for the state’s next fiscal year shall continue to be the rate of the
current fiscal year, unless the rate is increased by an act passed
by not less than two-thirds of the membership of each house of the
Legislature.

end insert begin insert

(iii) The Department of Finance shall notify the State Board of
Equalization and the Controller of the rate that is effective during
the state’s next fiscal year.

end insert

(3)  begin delete In order to maintain revenue neutrality for each year,
beginning end delete begin insert Beginning end insert with the rate adjustment on or before March
1, 2012, the adjustment under paragraph (2) shall also take into
account the extent to which the actual amount of revenues derived
pursuant to this subdivision and, as applicable, Section 7361.1,
begin insert and end insert the revenue loss attributable to the exemption provided by
Section 6357.7 resulted in a net revenue gain or loss for the fiscal
year ending prior to the rate adjustment date on or before March
1.

begin delete end delete begin delete

(4) The intent of paragraphs (2) and (3) is to ensure that the act
adding this subdivision and Section 6357.7 does not produce a net
revenue gain in state taxes.

end delete begin delete end delete

begin insert

begin insert SEC. 2. end insert   

end insert begin insert

This act provides for a tax levy within the meaning of
Article IV of the Constitution and shall go into immediate effect.

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SECTION 1.  

Section 14501 of the Public Resources Code is
amended to read:

14501.  

The Legislature finds and declares as follows:

(a) Experience in this state and others demonstrates that financial
incentives and convenient return systems ensure the efficient and
large-scale recycling of beverage containers. Accordingly, it is the
intent of the Legislature to encourage increased, and more
convenient, beverage container redemption opportunities for all
consumers. These redemption opportunities shall consist of dealer
and other shopping center locations, independent and industry
operated recycling centers, curbside programs, and other recycling
systems that assure all consumers, in every region of the state, the
opportunity to return beverage containers conveniently, efficiently,
and economically.

(b) California grocery, beer, soft drink, container manufacturing,
labor, agricultural, consumer, environmental, government, citizen,
recreational, taxpayer, and recycling groups have joined together
in calling for an innovative program to generate large-scale
redemption and recycling of beverage containers.

(c) This division establishes a beverage container recycling goal
of 80 percent.

(d) It is the intent of the Legislature to ensure that every
container type proves its own recyclability.

(e) It is the intent of the Legislature to make redemption and
recycling convenient to consumers, and the Legislature hereby
urges cities and counties, when exercising their zoning authority,
to act favorably on the siting of multimaterial recycling centers,
reverse vending machines, mobile recycling units, or other types
of recycling opportunities, as necessary for consumer convenience,
and the overall success of litter abatement and beverage container
recycling in the state.

(f) The purpose of this division is to create and maintain a
marketplace where it is profitable to establish sufficient recycling
centers and locations to provide consumers with convenient
recycling opportunities through the establishment of minimum
refund values and processing fees and, through the proper
application of these elements, to enhance the profitability of
recycling centers, recycling locations, and other beverage container
recycling programs.

(g) The responsibility to provide convenient, efficient, and
economical redemption opportunities rests jointly with
manufacturers, distributors, dealers, recyclers, processors, and the
Division of Recycling within the Department of Resources
Recycling and Recovery.

(h) It is the intent of the Legislature, in enacting this division,
that all empty beverage containers redeemed shall be recycled,
and that the responsibilities and regulations of the department shall
be determined and implemented in a manner that favors the
recycling of redeemed containers, as opposed to their disposal.

(i) Nothing in this division shall be interpreted as affecting the
current business practices of scrap dealers or recycling centers,
except that, to the extent they function as a recycling center or
processor, they shall do so in accordance with this division.

(j) The program established by this division will contribute
significantly to the reduction of the beverage container component
of litter in this state.

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