Amended in Assembly May 5, 2015

Amended in Assembly April 21, 2015

California Legislature—2015–16 Regular Session

Assembly Bill No. 1239

Introduced by Assembly Members Gordon and Atkins

February 27, 2015

An act to amend Section 42885 of, and to repeal and add Section 42872.1 of, the Public Resources Code, relating to tire recycling.

LEGISLATIVE COUNSEL’S DIGEST

AB 1239, as amended, Gordon. Tire recycling: California tire regulatory fee and waste tire program.

(1) The California Tire Recycling Act requires, until January 1, 2024, a person who purchases a new tire to pay a California tire fee of $1.75 per tire, for deposit in the California Tire Recycling Management Fund, for expenditure by the Department of Resources Recycling and Recovery upon appropriation by the Legislature, to fund the waste tire program and for other purposes, including to pay for the costs associated with a waste tire and used tire hauler program and manifest system, as provided. After January 1, 2024, existing law reduces the tire fee to $0.75 per tire.

Existing law requires any person generating waste tires or used tires that are transported or submitted for transportation, for offsite handling, altering, storage, disposal, or for any combination thereof, to complete a California Uniform Waste and Used Tire Manifest, as required by the department. Existing law requires a generator to provide the manifest to the waste and used tire hauler at the time of transfer of the tires, and to submit to the department, on a quarterly schedule, a legible copy of each manifest.

This bill would require a waste tire generator, as defined, begin insert that is a retail seller of new tires to end user purchasers end insert to pay a California begin insert tire end insert regulatory begin delete tire fee according to a schedule of amounts to be determined by the department. For a waste tire generator that is a retail seller of new tires to end user purchasers, the end delete begin insert fee. The end insert bill would authorize the department to establish the California tire regulatory fee in an amount that is sufficient to generate revenues equivalent to the reasonable regulatory costs incurred by the department incident to audits, inspections, administrative costs, adjudications, manifesting, registration, and other regulatory activities regarding these begin insert retail sellers as generators of end insert waste begin delete tire generators end delete begin insert tires end insert , but not to exceed $1.25 per new tire sold, as provided. begin delete For waste tire generators that are not retail sellers, the bill would authorize the department to establish the amount of the California tire regulatory fee in a amount that is sufficient to generate revenues equivalent to the reasonable regulatory costs incurred by the department incident to audits, inspections, administrative costs, adjudications, manifesting, registration, and other regulatory activities regarding those waste tire generators, end delete begin insert The bill would authorize the department to differentiate in setting the fees between the waste tire generators who are retail sellers end insert depending upon the nature of the activity generating waste tires, the number of waste tires generated, and other appropriate bases. begin delete The bill would prohibit the aggregate amount of California tire regulatory fees imposed to exceed the aggregate reasonable regulatory costs incurred by the department incident to audits, inspections, administrative costs, adjudications, manifesting, registration, and other regulatory costs for regulating waste tire generators. end delete

(2) Existing law establishes, as a part of the waste tire program, the tire recycling program, which promotes and develops alternatives to the landfill disposal of used whole tires. The program provides for grants to certain entities involved in activities that result in reduced landfill disposal of whole used tires, and development and implementation of a waste tire incentive payment program to promote increased demand begin delete of end delete begin insert for end insert waste tires recycled in this state. Under the act, until June 30, 2019, the Rubberized Pavement Market Development Act provides for the award of grants to certain public agency projects that use rubberized asphalt concrete.

This bill would repeal the Rubberized Pavement Market Development Act and instead enact the Tire Recycling Incentive Program Act. The bill would require the department, in accordance with the tire recycling program, to establish this incentive program to award payments to eligible recipients, as specified. The bill would require the department to award these payments in the amount of $2 for every 12 pounds of crumb rubber used by the eligible recipient, but would authorize the department to adjust this rate if it finds that the adjusted amount would further the purposes of the tire recycling act. The bill would require the department, while the existing tire fee remains greater than or equal to $1.75 per tire, to annually allocate, of the amount appropriated to the department for purposes of the waste tire program, $30,000,000 for the tire recycling incentive program.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

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

SECTION 1.  

Section 42872.1 of the Public Resources Code
is repealed.

SEC. 2.  

Section 42872.1 is added to the Public Resources Code,
to read:

42872.1.  

(a) This section shall be known, and may be cited,
as the Tire Recycling Incentive Program Act.

(b) In accordance with the tire recycling program authorized by
Section 42872, the department shall establish a tire recycling
incentive program that awards payments to eligible recipients, as
determined by the department, in the following manner:

(1) To cities, counties, other local governmental agencies, and
school districts for the funding of construction projects that use
recycled tires.

(2) To state and local governmental agencies, including regional
park districts, for the funding of disability access projects at parks
and Class I bikeways, as defined in subdivision (a) of Section
890.4 of the Streets and Highways Code, relative to projects that
use recycled tires.

(3) To a private manufacturer who produces a consumer product
using recycled tires in California.

(c) For purposes of subdivision (b), eligible recipients shall meet
specified criteria, as established by the department, that are
consistent with the provisions of this article.

(d) (1) Except as provided in paragraph (2), the department
shall award the payments pursuant to subdivision (b) in the amount
of two dollars ($2) for every 12 pounds of crumb rubber used by
the eligible recipient.

(2) The department may adjust the amount of payments awarded
pursuant to paragraph (1) to an amount that is greater than, or less
than, two dollars ($2) for every 12 pounds of crumb rubber if the
department finds this adjustment would further the purposes of
this article.

(e) (1) Of the amount appropriated to the department in the
annual Budget Act pursuant to subdivision (b) of Section 42889,
the department shall annually allocate thirty million dollars
($30,000,000) for the tire recycling incentive program established
pursuant to subdivision (b).

(2) This subdivision shall become inoperative if the tire fee
specified in subdivision (b) of Section 42885 becomes less than
one dollar and seventy-five cents ($1.75) per tire.

SEC. 3.  

Section 42885 of the Public Resources Code, as
amended by Section 31 of Chapter 401 of the Statutes of 2013, is
amended to read:

42885.  

(a) (1) For purposes of this section, “California tire
fee” means the fee imposed pursuant to subdivision (b) of this
section.

(2) For purposes of this section, a “California tire regulatory
fee” means a fee imposed pursuant to subdivision (c) of this
section.

(b) (1) A person who purchases a new tire, as defined in
subdivision (h), shall pay a California tire fee of one dollar and
seventy-five cents ($1.75) per tire.

(2) The retail seller shall charge the retail purchaser the amount
of the California tire fee as a charge that is separate from, and not
included in, any other fee, charge, or other amount paid by the
retail purchaser.

(3) The retail seller shall collect the California tire fee from the
retail purchaser at the time of sale and may retain 11⁄2 percent of
the fee as reimbursement for any costs associated with the
collection of the fee. The retail seller shall remit the remainder to
the state on a quarterly schedule for deposit in the California Tire
Recycling Management Fund, which is hereby created in the State
Treasury.

(c) (1) A waste tire generator, as defined by Section 18450 of
Title 14 of the California Code of Regulations, begin delete shall pay a
California tire regulatory fee according to a schedule of amounts
to be determined by the department pursuant to the following: end delete

begin delete (A) end delete begin delete   end delete begin delete For a waste tire generator end delete that is a retail seller of new tires
to end user begin delete purchasers, the end delete begin insert purchasers shall pay a California tire
regulatory fee. The end insert amount of the California tire regulatory fee
shall be established by the department in an amount that is
sufficient to generate revenues equivalent to the reasonable
regulatory costs incurred by the department incident to audits,
inspections, administrative costs, adjudications, manifesting,
registration, and other regulatory activities regarding these begin insert retail
sellers as generators of end insert waste begin delete tire generators end delete begin insert tires end insert , but not to exceed
one dollar and twenty-five cents ($1.25) per new tire sold. The
department may differentiate in setting fees between begin insert waste tire
generators who are end insert retail sellers of new tires begin delete who are waste tire
generators end delete depending upon the nature of the retail seller’s activity
generating waste tires, the number of waste tires generated, and
other appropriate bases.

begin delete

(B) For a waste tire generator that is not a retail seller, the
amount of the California tire regulatory fee shall be established
by the department in an amount that is sufficient to generate
revenues equivalent to the reasonable regulatory costs incurred by
the department incident to audits, inspections, administrative costs,
adjudications, manifesting, registration, and other regulatory
activities regarding these waste tire generators. The department
may differentiate between categories of waste tire generators that
are not retail sellers in setting fees depending upon the nature of
the activity generating waste tires, the number of waste tires
generated, and other appropriate bases.

(C) The aggregate amount of California waste tire fees imposed
pursuant to subparagraphs (B) and (C) shall not exceed the
aggregate reasonable regulatory costs incurred by the department
incident to audits, inspections, administrative costs, adjudications,
manifesting, registration, and other regulatory costs for regulating
waste tire generators.

end delete

(2) A waste tire generator begin insert that is a retail seller of new tires end insert shall
remit the begin delete fees end delete begin insert fee end insert assessed pursuant to this subdivision to the state
on a quarterly schedule for deposit in a separate account in the
California Tire Recycling Management Fund.

(d) The department, or its agent authorized pursuant to Section
42882, shall be reimbursed for its costs of collection, auditing, and
making refunds associated with the California Tire Recycling
Management Fund, but not to exceed 3 percent of the total annual
revenue deposited in the fund.

(e) The California tire fee imposed pursuant to subdivision (b)
shall be separately stated by the retail seller on the invoice given
to the customer at the time of sale. Any other disposal or
transaction fee charged by the retail seller related to the tire
purchase shall be identified separately from the California tire fee.

(f) A person or business who knowingly, or with reckless
disregard, makes a false statement or representation in a document
used to comply with this section is liable for a civil penalty for
each violation or, for continuing violations, for each day that the
violation continues. Liability under this section may be imposed
in a civil action and shall not exceed twenty-five thousand dollars
($25,000) for each violation.

(g) In addition to the civil penalty that may be imposed pursuant
to subdivision (f), the department may impose an administrative
penalty in an amount not to exceed five thousand dollars ($5,000)
for each violation of a separate provision or, for continuing
violations, for each day that the violation continues, on a person
who intentionally or negligently violates a permit, rule, regulation,
standard, or requirement issued or adopted pursuant to this chapter.
The department shall adopt regulations that specify the amount of
the administrative penalty and the procedure for imposing an
administrative penalty pursuant to this subdivision.

(h) For purposes of this section, “new tire” means a pneumatic
or solid tire intended for use with onroad or off-road motor
vehicles, motorized equipment, construction equipment, or farm
equipment that is sold separately from the motorized equipment,
or a new tire sold with a new or used motor vehicle, as defined in
Section 42803.5, including the spare tire, construction equipment,
or farm equipment. “New tire” does not include retreaded, reused,
or recycled tires.

(i) The California tire fee shall not be imposed on a tire sold
with, or sold separately for use on, any of the following:

(1) A self-propelled wheelchair.

(2) A motorized tricycle or motorized quadricycle, as defined
in Section 407 of the Vehicle Code.

(3) A vehicle that is similar to a motorized tricycle or motorized
quadricycle and is designed to be operated by a person who, by
reason of the person’s physical disability, is otherwise unable to
move about as a pedestrian.

(j) This section shall remain in effect only until January 1, 2024,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2024, deletes or extends that date.

SEC. 4.  

Section 42885 of the Public Resources Code, as
amended by Section 32 of Chapter 401 of the Statutes of 2013, is
amended to read:

42885.  

(a) (1) For purposes of this section, “California tire
fee” means the fee imposed pursuant to subdivision (b) of this
section.

(2) For purposes of this section, a “California tire regulatory
fee” means a fee imposed pursuant to subdivision (c) of this
section.

(b) (1) Every person who purchases a new tire, as defined in
subdivision (h), shall pay a California tire fee of seventy-five cents
($0.75) per tire.

(2) The retail seller shall charge the retail purchaser the amount
of the California tire fee as a charge that is separate from, and not
included in, any other fee, charge, or other amount paid by the
retail purchaser.

(3) The retail seller shall collect the California tire fee from the
retail purchaser at the time of sale and may retain 3 percent of the
fee as reimbursement for any costs associated with the collection
of the fee. The retail seller shall remit the remainder to the state
on a quarterly schedule for deposit in the California Tire Recycling
Management Fund, which is hereby created in the State Treasury.

(c) (1) A waste tire generator, as defined by Section 18450 of
Title 14 of the California Code of Regulations, begin delete shall pay a
California tire regulatory fee according to a schedule of amounts
to be determined by the department pursuant to the following: end delete

begin delete (A) end delete begin delete   end delete begin delete For a waste tire generator end delete that is a retail seller of new tires
to end user begin delete purchasers, the end delete begin insert purchasers shall pay a California tire
regulatory fee. The end insert amount of the California tire regulatory fee
shall be established by the department in an amount that is
sufficient to generate revenues equivalent to the reasonable
regulatory costs incurred by the department incident to audits,
inspections, administrative costs, adjudications, manifesting,
registration, and other regulatory activities regarding these begin insert retail
sellers as generators of end insert waste begin delete tire generators end delete begin insert tires end insert , but not to exceed
one dollar and twenty-five cents ($1.25) per new tire sold. The
department may differentiate in setting fees between begin insert waste tire
generators who are end insert retail sellers of new tires begin delete who are waste tire
generators end delete depending upon the nature of the retail seller’s activity
generating waste tires, the number of waste tires generated, and
other appropriate bases.

begin delete

(B) For a waste tire generator that is not a retail seller, the
amount of the California tire regulatory fee shall be established
by the department in an amount that is sufficient to generate
revenues equivalent to the reasonable regulatory costs incurred by
the department incident to audits, inspections, administrative costs,
adjudications, manifesting, registration, and other regulatory
activities regarding these waste tire generators. The department
may differentiate between categories of waste tire generators that
are not retail sellers in setting fees depending upon the nature of
the activity generating waste tires, the number of waste tires
generated, and other appropriate bases.

(C) The aggregate amount of California waste tire fees imposed
pursuant to subparagraphs (B) and (C) shall not exceed the
aggregate reasonable regulatory costs incurred by the department
incident to audits, inspections, administrative costs, adjudications,
manifesting, registration, and other regulatory costs for regulating
waste tire generators.

end delete

(2) A waste tire generator begin insert that is a retail seller end insert shall remit the
begin delete fees end delete begin insert fee end insert assessed pursuant to this subdivision to the state on a
quarterly schedule for deposit in a separate account in the
California Tire Recycling Management Fund.

(d) The department, or its agent authorized pursuant to Section
42882, shall be reimbursed for its costs of collection, auditing, and
making refunds associated with the California Tire Recycling
Management Fund, but not to exceed 3 percent of the total annual
revenue deposited in the fund.

(e) The California tire fee imposed pursuant to subdivision (b)
shall be separately stated by the retail seller on the invoice given
to the customer at the time of sale. Any other disposal or
transaction fee charged by the retail seller related to the tire
purchase shall be identified separately from the California tire fee.

(f) Any person or business who knowingly, or with reckless
disregard, makes any false statement or representation in any
document used to comply with this section is liable for a civil
penalty for each violation or, for continuing violations, for each
day that the violation continues. Liability under this section may
be imposed in a civil action and shall not exceed twenty-five
thousand dollars ($25,000) for each violation.

(g) In addition to the civil penalty that may be imposed pursuant
to subdivision (f), the department may impose an administrative
penalty in an amount not to exceed five thousand dollars ($5,000)
for each violation of a separate provision or, for continuing
violations, for each day that the violation continues, on any person
who intentionally or negligently violates any permit, rule,
regulation, standard, or requirement issued or adopted pursuant to
this chapter. The department shall adopt regulations that specify
the amount of the administrative penalty and the procedure for
imposing an administrative penalty pursuant to this subdivision.

(h) For purposes of this section, “new tire” means a pneumatic
or solid tire intended for use with onroad or off-road motor
vehicles, motorized equipment, construction equipment, or farm
equipment that is sold separately from the motorized equipment,
or a new tire sold with a new or used motor vehicle, as defined in
Section 42803.5, including the spare tire, construction equipment,
or farm equipment. “New tire” does not include retreaded, reused,
or recycled tires.

(i) The California tire fee may not be imposed on any tire sold
with, or sold separately for use on, any of the following:

(1) Any self-propelled wheelchair.

(2) Any motorized tricycle or motorized quadricycle, as defined
in Section 407 of the Vehicle Code.

(3) Any vehicle that is similar to a motorized tricycle or
motorized quadricycle and is designed to be operated by a person
who, by reason of the person’s physical disability, is otherwise
unable to move about as a pedestrian.

(j) This section shall become operative on January 1, 2024.