BILL ANALYSIS Ó AB 655 Page 1 Date of Hearing: April 22, 2015 ASSEMBLY COMMITTEE ON APPROPRIATIONS Jimmy Gomez, Chair AB 655 (Quirk) - As Amended April 6, 2015 ----------------------------------------------------------------- |Policy |Agriculture |Vote:|10 - 0 | |Committee: | | | | | | | | | | | | | | ----------------------------------------------------------------- Urgency: No State Mandated Local Program: NoReimbursable: No SUMMARY: This bill codifies certain legislative findings with respect to the importance of rendering and increases the maximum additional per-vehicle registration fee for transporters of inedible kitchen grease (IKG) from $300 to $350 per year while maintaining the overall cap on total registration fees per IKG transporter at $3,000 per year. FISCAL EFFECT: AB 655 Page 2 Annual GF revenue gains of approximately $30,000 to Department of Food and Agriculture (DFA) from fee increase, offset by anticipated increased cost for enforcement activities. COMMENTS: 1)Purpose. According to the author, the IKG program needs additional funds for enforcement activities. Transporting IKG does not require significant capital investment, attracting fly-by-night operators. High prices can encourage theft of IKG from reputable operators, while low prices can encourage illegal dumping, damaging water systems. The increase in registration fees is intended to assist DFA to increase enforcement actions to stop theft and illegal dumping. 2)Greasy Wheels. Current law imposes a base annual fee of $300 on IKG transporters and an additional annual enforcement and administration fee of up to $300 per vehicle used to transport IKG, subject to an overall cap of $3,000 per year per IKG transporter. This bill increases the annual per vehicle fee to $350 but maintains the $3,000 annual cap. Collection centers and renderers are also subject to annual fees of $1,500 and $3,000, respectively, which count toward the annual fee cap. As a result, this bill only affects IKG transporters without rendering licenses and fewer than 10 vehicles, and collection centers with fewer than 5 vehicles. Current law also imposes certain record keeping requirements on IKG transporters, subject to audit and inspection by both DFA and local law enforcement. Rendering essentially recycles IKG and other animal tissue AB 655 Page 3 into several stable materials used in a variety of industries, including biofuels, soaps, paints and varnishes, cosmetics, explosives, toothpaste, pharmaceuticals, leather, textiles, and lubricants. According to Render Magazine, an industry trade publication, market prices for IKG have been volatile over recent years, but can exceed $1,000 per metric ton. Analysis Prepared by:Joel Tashjian / APPR. / (916) 319-2081