BILL ANALYSIS                                                                                                                                                                                                    



                                                                    AB 1159


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          Date of Hearing:  April 13, 2015


                       ASSEMBLY COMMITTEE ON NATURAL RESOURCES


                                 Das Williams, Chair


          AB 1159  
          (Gordon) - As Amended April 6, 2015


          SUBJECT:  Product stewardship:  pilot program:  household  
          batteries and home-generated sharps waste


          SUMMARY:  Establishes a pilot product stewardship program for  
          the management of medical sharps and household primary  
          batteries.  


          EXISTING LAW:  


          1)Under the California Integrated Waste Management Act of 1989,  
            requires each city or county to divert 50 percent of solid  
            waste from landfill disposal or transformation on and after  
            January 1, 2000.  Establishes a statewide policy goal that not  
            less than 75 percent of solid waste be source reduced,  
            recycled, or composted on and after January 1, 2020.  

          2)Establishes the California Oil Recycling Enhancement Act,  
            which requires manufacturers of used oil to pay a fee of 4  
            cents per quart (16 cents per gallon) to the Department of  
            Resources Recycling and Recovery (CalRecycle), which then pays  
            a recycling incentive of 4 cents per quart to industrial  
            generators, curbside collection program operators, and  
            certified used oil collection centers for used oil collected  








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            from the public and transported for recycling.  

          3)Establishes the Electronic Waste Recycling Act of 2003, which  
            requires a retailer selling a covered electronic device (CED)  
            in California to collect a recycling fee (between $3 and $5)  
            from the consumer.  Fees are deposited into the Electronic  
            Waste Recovery and Recycling Account, which is continuously  
            appropriated to CalRecycle and the Department of Toxic  
            Substances Control (DTSC) to make electronic waste recovery  
            payments to cover the net cost of an authorized collector in  
            operating a "free and convenient" system for collecting,  
            consolidating, and transporting CEDs, and to make electronic  
            waste recycling payments to cover an electronic waste  
            recycler's average net cost of receiving, processing, and  
            recycling CEDs.  Defines CED as a product that contains a  
            video display device 4 inches and larger. 

          4)Establishes the Cell Phone Recycling Act, which requires every  
            retailer of cell phones to have in place a system for the  
            acceptance and collection of used cell phones for reuse,  
            recycling, or proper disposal.  

          5)Establishes the Rechargeable Battery Recycling Act, which  
            requires every retailer of rechargeable batteries to have in  
            place a system for the acceptance and collection of used  
            rechargeable batteries for reuse, recycling, or proper  
            disposal.  

          6)Establishes the Dry Cell Battery Management Act, which  
            establishes requirements for the production and labeling of  
            consumer products with dry cell batteries and sets limits on  
            the amount of mercury in those batteries.  

          7)Establishes the Mercury Thermostat Collection Act, which  
            requires manufacturers to establish and maintain a program for  
            mercury-added thermostats.  Requires the program to include  
            collection, handling, and arranging for appropriate management  
            of mercury-added thermostats.   









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          8)Requires pharmaceutical manufacturers that sell or distribute  
            a medication in California that is usually self-injected at  
            home with a hypodermic needle to submit to CalRecycle a plan  
            that describes any actions taken by the manufacturer for the  
            safe collection and proper disposal of the waste devices.  

          9)Establishes the Product Stewardship for Carpets Program, which  
            requires manufacturers of carpet sold in California to submit  
            a carpet product stewardship plan to CalRecycle that  
            demonstrates how waste carpet will be collected and properly  
            managed. 

          10)Establishes the Architectural Paint Recovery Program, which  
            requires architectural paint manufacturers to develop and  
            implement a program to manage waste latex paint.  

          11)Establishes the Used Mattress Recovery and Recycling Act,  
            which requires mattress manufacturers and retailers to develop  
            a mattress stewardship program to increase the recovery and  
            recycling of used mattresses.  

          12)Prohibits the disposal of home-generated sharps waste in  
            solid waste or recycling streams and requires pharmaceutical  
            manufacturers that sell or distribute a medication in  
            California that is self-injected at home through the use of a  
            hypodermic needle, pen needle, intravenous needle, or any  
            other similar device to annually submit a plan to CalRecycle  
            that describes what actions, if any, the manufacturer supports  
            for the safe management of sharps waste.

          13)Under the Cartwright Act, establishes broad anti-trust  
            requirements for businesses in California.  

          14)Under the Unfair Business Practices Act and the Unfair  
            Competition Law, imposes civil liability and criminal  
            penalties for any unlawful, unfair, or fraudulent business  
            act.

          THIS BILL: 








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          1)Requires product stewardship organizations (i.e., an  
            organization created by one or more producers of covered  
            products) to develop and implement a product stewardship plan.  
             


          2)Defines "covered product" as a consumer product that is used  
            or discarded in the state that is either a home generated  
            sharp waste or household battery.  


          3)On or before January 1, 2017, requires CalRecycle to adopt  
            regulations to implement the bill, which shall include: 


             a)   Performance standards for a covered product, including a  
               minimum collection rate and appropriate geographic coverage  
               for a covered product; 


             b)   Procedures for plan submittal; 


             c)   The appointment of a stakeholder advisory committee.  


          4)Specifies that the creation, implementation, management, and  
            cost of a plan by an organization are not a violation of the  
            Cartwright Act, the Unfair Practices Act, or the Unfair  
            Competition Law.  


          5)On or before July 1, 2017, requires an organization to submit  
            a plan to CalRecycle that will divert the covered product from  
            landfills and manage the covered product in a manner that is  
            consistent with the state's hierarchy for waste management. 









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          6)Requires that the plan include the following: 


             a)   Strategies to achieve the performance standards  
               established by CalRecycle; 


             b)   Strategies for managing and reducing the life-cycle  
               impacts of the covered product; 


             c)   A funding mechanism that provides sufficient funding to  
               carry out the plan, as specified; and,


             d)   A process by which the financial activities of the  
               organization will be subject to independent audit, which  
               may be reviewed by CalRecycle. 


          7)Within 30 days of receipt of a plan, requires CalRecycle to  
            review the plan and determine whether or not the plan is  
            complete.  If it deems the plan incomplete, requires  
            CalRecycle to notify the organization and requires the  
            organization to revise and resubmit the plan within 30 days.  


          8)Within 60 days of determining that a plan is complete,  
            requires CalRecycle to approve or not approve a plan based on  
            whether or not the plan complies with the bill and establishes  
            procedures for a plan that is not approved.  


          9)Requires an organization that submits a plan to pay an annual  
            administrative fee to CalRecycle.  Requires CalRecycle to set  
            the fee at an amount that is adequate to cover the costs of  
            administering the program.  









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          10)Directs fees and any penalties collected to the Product  
            Stewardship Account, which the bill establishes in the  
            Integrated Waste Management Fund.  Specifies that fees  
            collected may be used by CalRecycle to implement the  
            requirements of the bill.  


          11)Establishes civil penalties of up to $1,000 per day for  
            violations, and up to $10,000 per day for intentional,  
            knowing, or negligent violations.  Requires CalRecycle or a  
            court to consider specified factors when assessing a penalty.   



          12)On or before March 1, 2017, requires CalRecycle to appoint a  
            stakeholder advisory committee for each covered product to  
            provide technical feedback to an organization.  Requires that  
            members of the advisory committee include the environmental  
            community, solid waste industry, local governments, retailers,  
            and other key stakeholders.  Specifies that the advisory  
            committee be independent of the organization.  


          13)Beginning on or before January 1 one year after the approval  
            of the first plan, and annually thereafter, requires each  
            organization to submit a report to CalRecycle describing the  
            activities carried out pursuant to the plan, as specified.  


          14)On or before January 1, 2023, requires CalRecycle to report  
            specified information to the Legislature.  


          15)Sunsets the above provisions and related CalRecycle  
            regulations on January 1, 2024.  


          FISCAL EFFECT:  Unknown








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          COMMENTS:  


          1)This bill.  According to the author: 

               AB 1159 would establish the Product Stewardship Pilot  
               Program, which would require producers and product  
               stewardship organizations of covered products - either  
               home-generated sharps waste or household batteries, to  
               develop and implement a product stewardship plan.  

               Both of these products are widely used, lack convenient  
               disposal and recycling opportunities for consumers, and  
               have significant and indisputable end-of-life impacts.  

               The regulations would be performance-based instead of  
               "command and control," meaning that the product  
               manufacturers would be given certain performance goals for  
               the program but would be left to develop the compliance  
               mechanisms in the most cost-effective and efficient manner  
               possible and meet the goals set by the state.  

          2)Product stewardship/expanded producer responsibility (EPR).   
            Product stewardship refers to a policy model that includes  
            manufacturers in the end-of-life management for products that  
            they produce.  The California Product Stewardship Council  
            states that EPR is a strategy to place a shared responsibility  
            for end-of-life product management on all entities involved in  
            the product chain, instead of the local governments and  
            taxpayers, while encouraging product design changes that  
            minimize a negative impact on human health and the environment  
            at every stage of a product's lifecycle.  Ideally, EPR allows  
            the costs of management and disposal to be incorporated into  
            the total cost of a product.  Good EPR programs result in  
            products that are better designed for reuse and recycling,  
            make recycling more convenient for consumers, reduce illegal  
            disposal of hazardous materials, and encourage the use of  








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            recycled materials in new products.  

          In 2007, CalRecycle adopted strategic directives to guide solid  
            waste management in California.  Strategic Directive 5:   
            Producer Responsibility states that "it is a core value of  
            [CalRecycle] that producers assume the responsibility for the  
            safe stewardship of their materials in order to promote  
            environmental sustainability."  

          3)Household batteries.  In California, household batteries are  
            classified as universal waste, which includes materials that  
            DTSC has determined are hazardous waste that are ubiquitous  
            and contain mercury, lead, cadmium, copper, or other  
            substances hazardous to human and environmental health. Since  
            2006, universal waste has been prohibited from disposal in  
            solid waste landfills. 

          Currently, local household hazardous waste collection programs  
            are the primary outlet for proper management of universal  
            waste and other hazardous wastes generated by households,  
            including batteries.  Cost estimates to manage waste batteries  
            average around $800 per ton (with some costing up to $2,700  
            per ton), amounting to tens of millions of dollars each year.   
            With decreasing revenues and increasing responsibilities on  
            local governments, another solution is necessary to manage  
            these products.  Many local governments have greatly decreased  
            their household hazardous waste programs, leaving few  
            management options for the public.  To date, 133 local  
            resolutions have been adopted in California supporting the EPR  
            model.  

          The non-profit organization Call2Recycle is working in North  
            America to collect and recycle rechargeable batteries.   
            Call2Recycle operates under the Rechargeable Battery Recycling  
            Corporation to promote "environmental sustainability by  
            providing free battery and cell phone recycling in North  
            America."  The Call2Recycle program for rechargeable battery  
            and cell phone recycling is available to residents, retailers,  
            businesses, communities, municipalities, and public agencies  








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            in the US and Canada.  The program was created in 1994 and is  
            funded by battery and product manufacturers to raise awareness  
            about the importance of battery recycling and to promote  
            product stewardship initiatives. 

          In 2006, the European Commission adopted the Batteries Directive  
            2006/66/EC, which requires member states of the European Union  
            to reach a 25 percent collection rate by 2012 and 45 percent  
            by 2016.  The directive also establishes toxicity limits for  
            batteries.  

          4)Medical sharps.  An estimated one million Californians inject  
            medications outside traditional health care facilities, which  
            generate approximately 389 million sharps each year.  The  
            numbers of patients using injectable medications will continue  
            to grow because it is an effective delivery method.  The most  
            common home use of sharps is to manage diabetes.  Other  
            reasons to home-inject include multiple sclerosis,  
            infertility, migraines, allergies, hemophilia, and medications  
            for pets.

          California was one of the first states to address the problems  
            of sharps with the passage of SB 1305 (Figueroa), Chapter 64,  
            Statutes of 2006 to prohibit the disposal of medical sharps in  
            California's landfills.  Although illegal, most used needles  
            still end up in household trash and pose a significant risk of  
            injury and/or infection to custodial workers and solid waste  
            employees.

          5)Previous legislation. 

             a)   AB 2284 (Williams, 2014) would have required producers  
               of non-rechargeable household batteries to develop and  
               implement a plan to collect and manage batteries sold in  
               the state.  This bill was held in Assembly Appropriations  
               Committee.  

             b)   AB 488 (Williams, 2013) would have required producers of  
               non-rechargeable household batteries to develop and  








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               implement a plan to collect and manage batteries sold in  
               the state.  This bill was held in the Assembly  
               Appropriations Committee.  

             c)   AB 403 (Stone, 2013) would have required businesses that  
               sell medical sharps to establish a product stewardship plan  
               for the end of life management of home-generated medical  
               sharps.  This bill was held in the Senate Environmental  
               Quality Committee. 

             d)   SB 515 (Corbett, 2011) would have required a producer of  
               batteries sold in California to develop and implement a  
               household battery stewardship plan describing how it would  
               achieve collection of household batteries and the maximum  
               feasible recovery of materials from the collected  
               batteries.  This bill was held in the Senate Appropriations  
               Committee.

             e)   SB 1100 (Corbett, 2010) was substantially similar to SB  
               515.  This bill was held in the Assembly Rules Committee. 

          6)Suggested amendments.   

             a)   The intent of this bill is to ensure that producers of  
               covered products comply with the requirements of the bill,  
               either as individual companies or as members of an  
               organization; however, due to a drafting oversight, the  
               bill does not explicitly require them to participate.  The  
               committee may wish to amend the bill to clarify that  
               individual producers are subject to the bill's  
               requirements.  

             b)   This bill requires CalRecycle to adopt regulations  
               relating to the product stewardship plan; however, it does  
               not authorize CalRecycle to determine whether or not a plan  
               complies with the regulations.  The committee may wish to  
               amend the bill to grant CalRecycle this authority. 

             c)    This bill includes a Legislative Counsel drafting error  








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               on page 10, lines 1-2.  The committee may wish to amend the  
               bill to delete those lines.  

             d)   This bill establishes unspecified dates by which  
               administrative fees must be paid to CalRecycle.  Given  
               CalRecycle's authority to establish regulations under the  
               bill, the committee may wish to strike this provision.  

          REGISTERED SUPPORT / OPPOSITION:




          Support



          7th Generation Advisors 
          California Product Stewardship Council
          California State Association of Counties 
          Californians Against Waste
          Central Contra Costa Solid Waste Authority 
          City of Torrance
          Environmental Action Committee of West Marin
          Force
          Los Angeles County Solid Waste Management Committee/Integrated  
          Waste Management Task
          Natural Resources Defense Council 
          Recycle Smart 
          Rural County Representatives of California

















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          Opposition



          AdvaMed
          Biocom
          Biotechnology Industry Organization 
          California Cable and Telecommunications Association 
          California Healthcare Institute
          California Manufacturers and Technology Association 
          PhRMA


          Analysis Prepared by:Elizabeth MacMillan / NAT. RES. / (916)  
          319-2092