BILL ANALYSIS Ó
AB 1108
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Date of Hearing: May 13, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
AB
1108 (Low) - As Amended May 5, 2015
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Urgency: No State Mandated Local Program: YesReimbursable:
No
SUMMARY:
This bill prohibits certified recycling centers from accepting
or paying the California Refund Value (CRV) to a consumer for
more than 50 pounds of aluminum or plastic beverage containers
AB 1108
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or 500 pounds of glass beverage containers during a 24-hour
period.
FISCAL EFFECT:
Unknown, annual costs savings, potentially in the hundreds of
thousands to of dollars, resulting from fraud deterrence
(Beverage Recycling Fund).
In the summer of 2011, CalRecycle, in coordination with the
California Department of Food and Agriculture (CDFA), initiated
a pilot program to survey and document vehicles importing
out-of-state beverage container material into California through
all 16 CDFA Border Protection Stations.
During the first 60 days of the pilot program, the information
gathered revealed over 2,500 vehicles, including 378 rental
trucks filled to capacity, imported out-of-state beverage
container material through these stations. According to
CalRecycle, a conservative estimate of fraud exposure is $7
million annually. This bill makes it more difficult to redeem
large amounts of out-of-state beverage containers.
COMMENTS:
1)Purpose. According to CalRecycle, lowering the limits is a
significant way to reduce fraud in the program. As a result,
importers of out-of-state containers, which are not eligible
for CRV, and scavenger fleets illegally removing the contents
of residential curbside recycling bins will find it
considerably more time-consuming and risky to reap any
fraudulent gains.
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This bill prohibits a certified recycling center from
accepting or paying the CRV to a consumer for more than 50
pounds of aluminum beverage containers or plastic beverage
containers, or any combination thereof, or 500 pounds of glass
beverage containers, submitted by that consumer to the
certified recycling center in a single 24-hour period.
2)Background. The California Beverage Container Recycling and
Litter Reduction Act (Bottle Bill) requires beverage
containers sold in this state to have a CRV of 5 cents for
containers that hold fewer than 24 ounces and 10 cents for
containers that hold 24 ounces or more.
The Bottle Bill is designed to provide consumers with a
financial incentive for recycling and to make recycling
convenient to consumers. The centerpiece of the Bottle Bill
is the CRV. Consumers pay a deposit, the CRV, on each
beverage container they purchase. Retailers collect the CRV
from consumers when they buy beverages. The dealer retains a
small percentage of the deposit for administration and remits
the remainder to the distributor, who also retains a small
portion for administration before remitting the balance to
CalRecycle.
When consumers return their empty beverage containers to a
recycler (or donate them to a curbside or other program), the
deposit is paid back as a refund.
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According to CalRecycle, the Bottle Bill is currently
operating under a structural deficit, mainly caused by
historically high recycling rates and mandated program
payments. The structural deficit means that program
expenditures exceed program revenues under the current
mandated expenditure and revenue structure. When the Bottle
Bill does not have adequate funding, CalRecycle is required to
"proportionally reduce" many of the program's expenditures
evenly among program participants, with the exception of CRV
redemption for consumers.
3)Previous Redemption Limits.
In January, 2014, CalRecycle reduced the number of containers
an individual can bring to recycling centers for CRV in a
single day from 500 pounds of aluminum or plastic to 100
pounds, and from 2,500 pounds of glass to 1,000 pounds and
required that anyone transporting 25 pounds or more of
aluminum beverage containers or 250 pounds of glass beverage
containers into the state must pass through a CDFA quarantine
inspection station and obtain and carry a proof of inspection.
Analysis Prepared by:Jennifer Galehouse / APPR. / (916)
319-2081
AB 1108
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