BILL ANALYSIS Ó AB 1447 Page 1 Date of Hearing: April 27, 2015 ASSEMBLY COMMITTEE ON NATURAL RESOURCES Das Williams, Chair AB 1447 (Alejo) - As Amended April 9, 2015 SUBJECT: Solid waste: food and beverage packaging SUMMARY: Establishes minimum recycled content standards for polyethylene terephthalate (PET) food and beverage packing and expands the recycled content requirement for glass food and beverage containers to containers manufactured out of state. EXISTING LAW: 1)Pursuant to the California Beverage Container Recycling and Litter Reduction Act (Bottle Bill): a) Requires beverage containers sold in this state to have a California refund value (CRV) of 5 cents for containers that hold fewer than 24 ounces and 10 cents for containers that hold 24 ounces or more and requires a distributor to pay a redemption payment to CalRecycle. Continuously appropriates these funds to CalRecycle for the payment of refund values and processing fees. b) Requires that each new glass container manufactured in the state contain a minimum of 35% postfilled (recycled food container cullet) glass. Requires every glass food, drink, or beverage container manufacturer in the state to AB 1447 Page 2 report the amount of tons of new glass and the tons of postfilled glass used in the manufacturing of those containers to CalRecycle every month. 2)Pursuant to the Integrated Waste Management Act (IWMA): a) Requires that local governments divert at least 50% of solid waste from landfill disposal and establishes a statewide goal that 75% of solid waste be diverted from landfill disposal by 2020. b) Requires that 50% of newsprint paper sold in the state contain a minimum of 40% postconsumer recycled content. c) Requires that rigid plastic packaging containers sold in the state contain a minimum of 25% postconsumer recycled material and have a recycling rate of at least 45%. d) Requires that manufacturers of plastic trash bags that are at or above 0.70 mils thick to annually certify that they comply with one of the following: i) That the bags sold in California contain a minimum of 10% recycled content; or, ii) That all plastic products sold by the manufacturer in California contain a minimum of 30% recycled content. e) Requires that fiberglass sold in the state contain a minimum of 30% postconsumer recycled content. f) Requires that expanded polystyrene loosefill packaging (i.e., packing peanuts) sold in the state contain a minimum of 60% recycled content. g) Prohibits a manufacturer or supplier from selling a AB 1447 Page 3 plastic food or beverage container that is advertised with a specific recycling content amount unless the manufacturer or supplier is able to provide certification of that claim in a format that is easy to understand and scientifically accurate. Requires a manufacturer or supplier to provide information and documentation verifying the recycling content of a plastic food or beverage container within 90 days of a request for such information made by a member of the public or a state agency. THIS BILL: 1)Defines "PET plastic packaging" to mean food, drink, or beverage packaging material that consists primarily of polyethylene terephthalate and used to contain food or beverages. 2)Requires that, on and after January, 1, 2017, every manufacturer of PET plastic packaging for sale in the state to report to CalRecycle the amount of tons of new PET plastic packaging made for sale by that manufacturer and the total amount of postfilled PET plastic used in the manufacturing of that packaging. 3)On and after July 1, 2016, requires each manufacturer of PET plastic packaging for sale in the state to include a minimum of 10 percent of postfilled PET plastic in the plastic packaging that it manufactures. 4)Expands the 35% recycled content requirement for glass food, drink, and beverage containers manufactured in the state to all glass containers sold in the state. FISCAL EFFECT: Unknown AB 1447 Page 4 COMMENTS: 1)This bill. This bill is intended to increase the use of recycled content in California. According to the author: Californians are proud of their recycling efforts, but it's unlikely that most Californians are aware that while our collection for recycling rates are high, much of the materials collected for recycling are in fact exported overseas for recycling. Less than half of the PET beverage containers collected for recycling in California are now being directed to California-based reclaimers and sold to California-based manufacturers. The balance of collected PET - over half - is exported out of state, generally overseas. It can be argued that California consumers can reasonably expect that the beverage and food containers they buy are made out of recycled content, given our high recycling collection rates? To increase the amount of plastic recycling in-state, meet consumers' basic expectations for buying recycled, and create parity with other container minimum recycling laws, AB 1447 proposes to create a minimum recycled content standard for all PET containers sold in the state at 10%. In addition, the current glass recycled content standard only applies to containers made in-state. To be uniform and consistent? AB 1447 will require all glass containers manufactured or filled in California to meet the existing 35% recycled content minimum. AB 1447 Page 5 2)Food and beverage packaging. Historically, glass, steel, aluminum, and paper have been recycled for use in food packaging. The risk of post-consumer contamination has not been a major concern with glass and metals, because they are generally impervious to contaminants and are adequately cleaned at the temperatures used in their recycling. In addition, pulp from reclaimed fiber in paper and paperboard may be used for food-contact articles provided it meets federal standards (Title 21 of the Code of Federal Regulations, Section 176.260). Manufacturers of plastic food packaging that contains recycled plastic are responsible for ensuring that the recycled material is of suitable purity for its intended use and will meet all existing specifications for the virgin material. The federal Food and Drug Association (FDA) states that the main safety concerns with the use of recycled plastic materials in food packaging are: 1) that contaminants from the postconsumer material may appear in the final food-contact product made from the recycled material; 2) that recycled postconsumer material not regulated for food-contact use may be incorporated into food-contact packaging; and, 3) that adjuvants in the recycled plastic may not comply with the regulations for food-contact use. To address these concerns, FDA considers each proposed use of recycled plastic on a case-by-case basis and issues informal advice as to whether the recycling process is expected to produce plastic suitable for food packaging. FDA then issues a "non-objection" letter to the manufacturer for the packaging. Generally, manufacturers use postfilled plastic, which refers to recycled materials that contained food or beverages prior to recycling, to meet FDA standards. 3)PET. PET is the most common plastic used in food and beverage packaging, including bottled water and soda. According to CalRecycle data, 43% of Bottle Bill containers are PET, making it the most common beverage packaging material in California. AB 1447 Page 6 Several plastic food and drink manufacturers located in California have received non-objection letters from the FDA and comply with the state's existing recycled content requirements for rigid plastic packaging containers. Several beverage manufacturers also include postfilled content in their packaging. For example, Arrowhead and Nestle bottled water both report a 50% recycled content rate; Pepsi reports 10% recycled content; and, Naked Juice reports that their bottles are made from 100% recycled content. California has seven reclaimers accepting plastic for washing and producing recycled flake or pellets and 30 manufacturers that use recycled plastic to manufacture new products. While there has been significant growth in the use of recycled plastic in California, the vast majority of recycled plastic is sent overseas. 4)Glass. According to data reported to CalRecycle by glass food and beverage containers, the statewide recycling rate for glass containers was just over 48% in 2014. For beverage containers that are included in the Bottle Bill, the rate was 49.7% in 2013. Glass food and beverage containers manufactured in California are required to contain a minimum of 35% postconsumer recycled content. Five glass container manufacturing facilities are located in California and employ approximately 2,600 people. 5)Related legislation. SB 732 (Pan) would have required every manufacturer of a beverage sold in any plastic container to demonstrate to CalRecycle that each type of a plastic beverage container sold in this state contains, on average, not less than 10% postfilled material on and after January 1, 2017 and AB 1447 Page 7 prohibited CalRecycle from reducing the Bottle Bill processing fee requirements for any beverage manufacturer for any beverage sold in the state unless the manufacturer demonstrates to CalRecycle that the container is manufactured at a facility that meets or exceeds the state's recycled content requirements, regardless of whether the container is manufactured in this state. This bill failed passage in the Senate Environmental Quality Committee on a vote of 1-0 (six members did not vote) on April 15th. 6)Proposed amendments. The author has proposed amendments to the bill, which the committee may wish to adopt if the bill passes. These amendments would: a) Delete the section of the bill related to recycled content requirements for glass containers. b) Move the requirements related to PET packaging out of the Bottle Bill and into a new chapter in the IWMA. c) Clarify that the provisions apply to PET packaging that is manufactured in the state or imported to be filled with food or beverages in the state. d) Establish certification reporting, and enforcement provisions to enable CalRecycle to enforce the bill's requirements. AB 1447 Page 8 REGISTERED SUPPORT / OPPOSITION: Support CA Plastics Recyclers Coalition Californians Against Waste California Refuse Recycling Council Don't Waste LA Project EcoPet Plastics Los Angeles Alliance for a New Economy Napa Recycling and Waste Services Peninsula Packaging, LLC Peninsula Plastics Packaging RePET AB 1447 Page 9 rePlanet StopWaste Strategic Materials, Inc. Tri-Ced Community Recycling Verdeco Recycling, Inc. Waste Management Zanker Recycling Opposition American Chemistry Council Glass Packaging Institute Analysis Prepared by:Elizabeth MacMillan / NAT. RES. / (916) 319-2092 AB 1447 Page 10