BILL ANALYSIS Ó
AB 1239
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ASSEMBLY THIRD READING
AB
1239 (Gordon and Atkins)
As Amended May 5, 2015
Majority vote
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|Committee |Votes |Ayes |Noes |
| | | | |
| | | | |
|----------------+------+--------------------+--------------------|
|Natural |6-3 |Williams, Cristina |Dahle, Hadley, |
|Resources | |Garcia, McCarty, |Harper |
| | |Rendon, Mark Stone, | |
| | |Wood | |
| | | | |
|----------------+------+--------------------+--------------------|
|Appropriations |12-5 |Gomez, Bonta, |Bigelow, Chang, |
| | |Calderon, Daly, |Gallagher, Jones, |
| | |Eggman, |Wagner |
| | | | |
| | | | |
| | |Eduardo Garcia, | |
| | |Gordon, Holden, | |
| | |Quirk, Rendon, | |
| | |Weber, Wood | |
| | | | |
| | | | |
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SUMMARY: Establishes the Tire Recycling Incentive Program (TRIP)
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Act to provide incentives for tire recycling activities in
California. Establishes a new tire regulatory fee, set by the
Department of Resources Recycling and Recovery (CalRecycle), to
cover its regulatory costs associated with waste and used tire
management. Specifically, this bill:
1)Requires CalRecycle to establish a tire recycling incentive
program to award payments to eligible recipients, as determined
by CalRecycle, in the following manner:
a) To cities, counties, other local government agencies, and
school districts to fund construction projects that use
recycled tires.
b) To state and local government agencies, including regional
park districts, to fund disability access projects at parks
and bikeways.
c) To a private manufacturer who produces a consumer product
using recycled tires in California.
2)Requires CalRecycle to award $2 for every 12 pounds of crumb
rubber used by the eligible recipient and authorizes CalRecycle
to adjust this amount if it determines the adjustment would
further the purposes of CalRecycle's tire program.
3)Requires CalRecycle to annually allocate $30 million for the
TRIP until the California tire fee becomes less than $1.75.
4)Requires retail sellers to pay a California tire regulatory fee
at an amount to be determined by CalRecycle at an amount
sufficient to generate revenues equivalent to the reasonable
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regulatory costs incurred by CalRecycle for audits, inspections,
administrative costs, adjudications, manifesting, registration,
and other regulatory activities regarding the generators, but
not to exceed $1.25 per tire.
5)Requires the waste tire generator to remit the regulatory fee
quarterly.
6)Makes corresponding changes to the provision of law that
replaces current law on January 1, 2024.
FISCAL EFFECT: According to the Assembly Appropriations
Committee, this bill has the following fiscal impacts:
1)Increased annual revenue of approximately $38.5 million
resulting from the fee (special fund), based on a fee of $1.25
on 30.8 million new tires sold annually.
2)Annual transfers of $30 million from the Waste Tire Program to
TRIP (special fund) while the existing fee remains no less than
$1.75.
3)Increased CalEPA administrative costs of approximately $1
million annually (special fund).
COMMENTS: According to CalRecycle, approximately 40 million waste
tires are generated in California every year. CalRecycle's
diversion goal is 90%; according to the California Waste Tire
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Market Report: 2013, California has achieved an overall diversion
rate of 87.3%. Of the of the 40.8 million tires generated: 12.3
million were exported (for fuel or reuse); 7.9 million were
recycled as ground rubber; 0.5 million were used in civil
engineering projects; 6.6 million were reused (either sold as used
tires or retreaded); 8.2 million were used as tire derived fuel in
cement kilns or at co-generation facilities; 1.2 million were used
as cover at landfills; and, 5.3 million were disposed in
landfills.
CalRecycle's "affiliated goals" to achieve its 90% diversion rate
for tires are: 1) develop long-term, sustainable, and diversified
market demand for California tire-derived products; 2) ensure the
protection of public health, safety, and the environment while
developing a safe and high-quality supply infrastructure to meet
that demand; and, 3) foster information flow and technology and
product development so that environmental protection and diversion
goals are achieved with supply and demand in balance.
CalRecycle is in the process of adjusting its waste tire market
development programs, in accordance with its Five Year Plan, to
more effectively focus CalRecycle resources on diversifying and
expanding markets. CalRecycle has also indicated a long-term
vision of increasing tire recycling, rather than just diversion.
Specifically, CalRecycle has begun crafting a new incentive
program that would differentiate incentive payments, with higher
payments going to "preferred end-users" that recycle waste tires
into new products such as rubberized asphalt concrete, moderate
payments for end uses such as tire-derived aggregate, and lower
payments for less-preferred non-disposal management such as energy
generation.
CalRecycle's analysis of past grants indicates that about 25% of
the total sales of California-produced tire-derived products were
supported by grants, while about 12.5% of California crumb rubber
sold to paving applications was supported by CalRecycle paving
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grants. In order to achieve CalRecycle's long-term goals for tire
recycling, it is in the process of redirecting approximately half
of its budget for the Tire Derived Product Grant Program to a new
Tire Incentive Program that will focus on promoting new
tire-derived product development and shift established product
manufacturers to use of ground rubber from other feedstock.
CalRecycle is also replacing the Tire-Derived Product Business
Assistance Program, which offered a wide variety of assistance to
manufacturers, with a new Tire Outreach and Market Analysis (TOMA)
program. TOMA will focus exclusively on outreach and education to
promote tire-derived products.
This bill is consistent with the direction and recommendations of
CalRecycle's 2015 Five Year Plan.
Analysis Prepared by:
Elizabeth MacMillan / NAT. RES. / (916) 319-2092
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