BILL ANALYSIS Ó AB 1159 Page 1 Date of Hearing: April 28, 2015 ASSEMBLY COMMITTEE ON ENVIRONMENTAL SAFETY AND TOXIC MATERIALS Luis Alejo, Chair AB 1159 (Gordon) - As Amended April 21, 2015 SUBJECT: Product stewardship: pilot program: household batteries and home-generated sharps waste SUMMARY: Establishes a limited-term product stewardship program for home-generated medical sharps and household batteries. Specifically, this bill: 1) Defines "covered product" as a home-generated medical sharp or household battery. 2) Defines "product stewardship organization" as one or more producers of a covered product to act as an agent on behalf of a producer to design, submit, and administer a product stewardship plan, or a producer of a covered product. 3) Requires each product stewardship organization to develop and implement a product stewardship plan. 4) Requires the California Department of Resources Recycling and Recovery (CalRecycle), by January 1, 21017, AB 1159 Page 2 to adopt regulations that, at a minimum, include: a. Performance standards for a covered product, which shall include a minimum collection rate and appropriate geographic coverage for a covered product; b. Procedures for product stewardship plan submittal; and, c. The appointment of a stakeholder advisory committee. 5) States that any action by a product stewardship organization or its members that relates to any of the following is not a violation of the Cartwright Act (Business & Professions Code (B&P) § 16700, et seq.), the Unfair Practices Act (B&P 1700, et seq.), or the Unfair Competition Law (B&P § 17200, et seq.) 6) States that any action by a product stewardship organization or its members that relates to any of the following is not exempt from the aforementioned laws: a. Fixing a price of or for a covered product, except related to the product stewardship plan; b. Fixing the output of production of a covered product; and, c. Restricting the geographic area in which, or customer to whom, a covered product will be sold. AB 1159 Page 3 7) Requires, on or before July 1, 2017, a product stewardship plan organization to submit a product stewardship plan to CalRecycle. 8) Requires a product stewardship plan to contain the following: a. Strategies to achieve the performance standards set 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; and d. A process by which the financial activities of the product stewardship organization will be subject to an independent audit. 9) Requires CalRecycle, within 30 days of receipt of a submitted product stewardship plan, to review and determine whether the product stewardship plan is complete or incomplete, and requires CalRecycle to notify a product stewardship organization of an incomplete plan's deficiencies and require resubmittal. 10) Requires CalRecycle, within 60 days, to determine whether a product stewardship plan deemed complete complies with its regulations, and requires CalRecycle to notify the AB 1159 Page 4 product stewardship organization of its plans to approve or deny the product stewardship plan. 11) Requires CalRecycle to delineate reasons for not approving a product stewardship plan, and allows the submitter to revise and resubmit a product stewardship plan within 60 days of receiving notice of disapproval. 12) States that any product stewardship plan not approved by January 1, 2018 is not in compliance. 13) Requires a product stewardship organization submitting a product stewardship plan to pay CalRecycle an annual administrative fee, which shall be set at an appropriate amount to cover CalRecycle's administrative costs. 14) Creates the Product Stewardship Account and Product Stewardship Penalty Subaccount. 15) Allows CalRecycle or a court to assess a civil penalty on any person in violation of the provisions of this bill. 16) Requires CalRecycle, by March 1, 2017, to appoint a stakeholder advisory committee for each covered product to provide technical feedback, and requires the stakeholder advisory committee to report to CalRecycle on product stewardship organizations progress on implementation. 17) Requires each product stewardship organization to annually report to CalRecycle on the activities carried out pursuant to the product stewardship plan. AB 1159 Page 5 18) Requires CalRecycle, by July 1, 2023, to report to the Legislature with evaluations of the product stewardship organizations, financial information and overall cost savings. 19) Sunsets the provisions of this bill on January 1, 2024. EXISTING LAW: 1) Pursuant to the Integrated Water Management Act of 1989, requires each city and county in California to implement plans to divert 25-percent of its waste stream by 1995 and 50-perent starting in 2000. (Public Resources Code (PRC) § 41780, et seq.) 2) Requires each city to prepare, adopt, and submit to the county in which the city is located a HHW element which identifies a program for the safe collection, recycling, treatment, and disposal of hazardous wastes, which are generated by households in the city and which should be separated from the solid waste stream. (PRC § 41500) 3) Authorizes a city HHW element to include a program for the safe collection, treatment, and disposal of sharps waste generated by households. (PRC § 41502) 4) Requires each County to prepare a HHW element which identifies a program for the safe collection, recycling, treatment, and disposal of hazardous wastes, which are generated by households in the city and which should be separated from the solid waste stream. (PRC § 41510) AB 1159 Page 6 5) Authorizes a county HHW element to include a program for the safe collection, treatment, and disposal of sharps waste generated by households. (PRC § 41502) 6) Requires manufacturers of self-injectable medications to annually submit a plan describing how it provides for the safe collection and proper disposal of medical sharps. (PRC § 47115) 7) Prohibits the disposal of home-generated sharps waste in the trash or recycling containers, and requires that all sharps waste be transported to a collection center in a sharps container approved by the local enforcement agency. (Health and Safety Code (H&S) § 118286) FISCAL EFFECT: Unknown. COMMENTS: Need for the 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 AB 1159 Page 7 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 goals set by the state." Extended producer responsibility: CalRecycle defines extended producer responsibility (EPR) as a strategy to place a shared responsibility for end-of-life product management on the producers, and all entities involved in the product chain, instead of the general public; while encouraging product design changes that minimize a negative impact on human health and the environment at every stage of the product's lifecycle. This allows the costs of treatment and disposal to be incorporated into the total cost of a product. It places primary responsibility on the producer, or brand owner, who makes design and marketing decisions. It also creates a setting for markets to emerge that truly reflect the environmental impacts of a product, and to which producers and consumers respond. By shifting costs and responsibilities of product disposal to producers and others who directly benefit, EPR provides an incentive to eliminate waste and pollution through product design changes. There are a number of existing, statewide EPR programs for AB 1159 Page 8 various products, including, but not limited to: Paint stewardship : The California Paint Stewardship Law (Chapter 420, Statutes of 2010) follows producer responsibility principles to ensure that leftover paint is properly managed in a manner that is sustainably funded. Under the program, manufacturers are required to establish and finance a safe and reliable system for the recovery and proper management of leftover paint from residents and businesses. Historically, paint has represented almost one-third of the material collected through local HHW programs and costs local government millions of dollars to manage. Used Oil : The California Used Oil Recycling Enhancement Act (Chapter 817, Statutes of 1991) requires oil manufacturers to pay to CalRecycle an established fee per gallon of lubricating oil sold in California. CalRecycle can use those fees to provide grants to industrial generators, curbside collection programs, and certified collection centers as incentive payments to discourage the illegal disposal of used oil and increase used oil recycling. Mattresses : The California Used Mattress Recovery and Recycling Act (Chapter 388, Statutes of 2013) aims to reduce illegal dumping, increase recycling, and substantially reduce public agency costs for the end-of-use management of used mattresses by requiring mattress retailers to offer consumer the option to have a used mattress picked up at the time of delivery of a new mattress. Medical sharps: An estimated one million Californians inject medications outside traditional health care facilities, which generate approximately 389 million sharps each year. Improper sharps disposal can affect janitors, maids, pest control workers, groundskeepers, waste management workers, and children or household pets among others. Roughly 25% to 45% of AB 1159 Page 9 all facilities processing household trash (besides recycling) in California have workers hand-sorting recyclable material out of that trash. A single worker's on-the-job needle stick can mean weeks of taking drugs to prevent the spread of infection, with side effects including nausea, depression, and extreme fatigue as well as months waiting for expensive periodic tests to reveal whether they contracted life-threatening HIV/AIDs or hepatitis B or C. Under current law, a pharmaceutical manufacturer that sells or distributes a medication in California that is intended to be self-injected at home through the use of a hypodermic needle, pen needle, intravenous needle, or any other similar device, is required to submit a plan to CalRecycle that describes the actions taken by the manufacturer to support or provide for the safe collection and proper disposal of the waste devices, and educate consumers about safe sharps management and collection opportunities. To date, CalRecycle has received sharps collection and disposal plans from 24 pharmaceutical manufacturers or distributors. Batteries: Up until February 8, 2006, California residents were allowed to throw away used battery in the trash. However, since then, all batteries are considered hazardous waste and have been prohibited from every solid waste stream in the state due to those toxic materials. All batteries must be recycled, or taken to a household hazardous waste disposal facility, a universal waste handler or an authorized recycling facility. 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. AB 1159 Page 10 According to a University of California case study, "Single-Use Alkaline Battery Case Study," which assessed the extent to which product life-cycle greenhouse gas emissions might be reduced through possible product design, manufacturing, and end-of-life management strategies introduced under a producer's EPR initiatives, found that "batteries represent a reasonable opportunity for EPR programs due to the ready availability of environmental improvements through design, manufacture, and end-of-life strategies, which may offer California additional greenhouse gas emissions reductions beyond those expected under its current batteries recycling scheme." In 2004, the Legislature enacted the Rechargeable Battery Recycling Act, which went into effect July 1, 2006, requiring all retailers that sell or have sold rechargeable batteries to take back spent batteries for recycling at no charge to the consumer. Rechargeable batteries only constitute about 5% of all disposed batteries, leaving room for much-needed policies for end-of-life battery management. Arguments in support: The League of California Cities argues that, "Managing the waste stream is a very expensive and often burdensome task for local governments. Cities and Counties spend upwards of $500 million annually to manage products prohibited from landfills as well as those lawfully disposed of at the landfill - a cost that local governments ultimately pass along to the consumer in the form of fees on solid waste services. AB 1159 takes an important first step in better managing home-generated sharps and household batteries by requiring product producers and product stewardship organizations to help address end-of-life issues for their products, thereby keeping them out of the local landfill and ultimately lowering the amount of waste that must be disposed in California." Arguments in opposition: Sanofi, a healthcare and life science AB 1159 Page 11 company, argues that, "? any discussion of recycling or collection of waste should start by taking into consideration and allowing for programs and facilities that already exist to dispose of used batteries and sharps waste as well as infrastructure that can be potentially utilized efficiently." Related legislation: AB 45 (Mullin). Requires local governments to increase diversion of various household hazardous wastes, including household batteries and home-generated medical sharps, and meet designated diversion goals for those wastes. This bill is set to be heard in the E.S&T.M. Committee on April 28, 2015. Double referral: This bill was double referred to the Assembly Natural Resources Committee where is passed on April 13, 2015, on a 9-0 vote. REGISTERED SUPPORT / OPPOSITION: Support 7th Generation Advisors Alameda County Alameda County Medication Education Disposal Safety CA Refuse Recycling Council (CRRC) AB 1159 Page 12 California Product Stewardship Council California Refuse Recycling Council California State Association of Counties (CSAC) Californians Against Waste (CAW) Castro Valley Sanitation District Central Contra Costa Solis Waste Authority (Recycle Smart) City of Santa Monica City of Sunnyvale City of Thousand Oaks City of Torrance Clean Water Action Contra Costa Clean Water Program (CCCWP) Delta Diablo AB 1159 Page 13 League of California Cities Los Angeles County Solid Waste Management Committee/Integrated Waste Management Task Force Marin County Hazardous & Solid Waste Management Authority Marin County Solid Waste Management JPA Marin Sanitary Service Metropolitan Recycling (Bakersfield) Napa County Napa Recycling and Waste Services Riverside County Waste Management Department Natural Resources Defense Council Republic Services Riverside County Waste Management Dept. Rural County Representatives of California (RCRC) Sacramento County AB 1159 Page 14 Santa Clara County Solid Waste Association of North America (SWANA) Tehama County Sanitary Landfill Agency UltiMed West Marin Environmental Action Committee Western Placer Waste Management Authority Opposition AdvaMed Association of Home Appliance Manufacturers Biocom Biotechnology Industry Organization California Healthcare Institute AB 1159 Page 15 California Manufacturers and Technology Association California Cable & Telecommunications Association (CCTA) CalTax PhRMA Sanofi Technet Analysis Prepared by:Paige Brokaw / E.S. & T.M. / (916) 319-3965