BILL ANALYSIS Ó
AB 2153
Page 1
Date of Hearing: April 12, 2016
ASSEMBLY COMMITTEE ON ENVIRONMENTAL SAFETY AND TOXIC MATERIALS
Luis Alejo, Chair
AB 2153
(Cristina Garcia) - As Amended April 5, 2016
SUBJECT: Lead-Acid Battery Recovery and Recycling Act
SUMMARY: Establishes mandatory requirements for the collection
and recycling of lead-acid batteries. Specifically, this bill:
1) Establishes the Lead-Acid Battery Recovery and Recycling
Act.
2) Defines "lead-acid battery" as any battery that consists
of lead and sulfuric acid and is used as a power source.
3) Defines "lead-acid battery organization" (LABO) as a
501(c)(3) or 501 (c)(6) non-profit organization that is
established by a qualified industry association, composed
of manufacturers, recyclers, retailers, and environmental
justice organizations.
4) Defines "qualified industry association" as the Battery
Council International (BCI), or a successor of that
organization, or a group of lead-acid battery manufacturers
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that collectively represent at least 35 percent of the
volume of lead-acid batteries manufactured in the United
States.
5) Requires, on or before July 1, 2017, a qualified
industry association to establish a LABO to develop,
implement and administer the lead-acid battery recycling
program.
6) Requires the California Department of Resources
Recycling and Recovery (CalRecycle), within 60 days of
receipt of a request for certification, to notify the LABO
of CalRecycle's decision to certify or not.
7) Requires the director of CalRecycle to appoint an
advisory committee to advise the LABO. Requires the
advisory committee to be comprised of specified
representatives. Requires the LABO to consult with the
advisory committee at least once during the development of
the plan, and annually prior to submitting an annual report
and budget.
8) Requires, on or before January 1, 2018, each
manufacturer, retailer, and recycler to register with the
LABO.
9) Prohibits, on or after January 1, 2019, a retailer from
selling, distributing, or offering for sale a lead-acid
battery unless the manufacturer or recycler is in
compliance with the provisions of this bill.
10) Requires, on or before July 1, 2018, the LABO to develop
and submit to CalRecycle a plan with specified elements for
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recycling lead-acid batteries.
11) Authorizes the LABO to include market development
opportunities that would provide incentives to universities
and research companies to find alternatives to lead in
batteries.
12) Requires CalRecycle to review the plan for compliance
and specifies time frames for taking action on approval.
13) Requires, on or before January 1, 2021, CalRecycle, in
consultation with the LABO, to establish and make public
the state baseline amount of, and goals for, recycling of
lead-acid batteries with California recycling stickers.
14) Requires, on or before July 1, 2018, and annually
thereafter, the LABO to prepare and submit to CalRecycle a
proposed budget with specified information. Specifies
timeframes for CalRecycle to review and approve the budget.
15) Requires the LABO to reimburse CalRecycle for incurred
administrative costs. Establishes the Used Lead-Acid
Battery Recycling Fund and requires all administrative
revenues to be deposited into that fund.
16) Requires the LABO to set the amount of a recycling
charge to be added to the purchase price of a lead-acid
battery at the point of sale. Requires the charge to be
based on the value of lead, prohibits the charge from
exceeding $20 and from being less than $15; and, requires
it to be a flat rate. Specifies terms and conditions for
adjusting the amount of the charge. Requires a charge to be
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assessed on all lead-acid batteries once CalRecycle
approves the plan. Requires the charge to be clearly
delineated on a customer's receipt of purchase.
17) Requires, on a quarterly basis, a manufacturer,
recycler, retailer, or distributor to submit all moneys
collected from the charge, minus the amount refunded to
consumers for the return of lead-acid batteries with
California recycling stickers, to the LABO.
18) Requires the LABO to remit to the state $1 from the sale
of each lead-acid battery with a California recycling
sticker. Requires remittance of $2 under specified
conditions.
19) Establishes the Lead-Acid Battery Cleanup Fund for the
deposit of the $1 from each sale of a lead-acid battery.
Prohibits the balance of the fund from exceeding $100
million.
20) Requires continuous appropriation of the Lead-Acid
Battery Cleanup Fund to the Department of Toxic Substances
Control (DTSC) for the cleanup of areas of the state that
have been contaminated by the production, recycling, or
improper disposal of lead-acid batteries and activities.
21) Authorizes the lead-acid recycling organization to hire
independent third-party auditors to audit entities
responsible for remitting the specified revenues. Specifies
audit requirements. Specifies administrative record keeping
requirements for lead-acid recycling organizations.
22) Requires, on or before July 1, 2020, and annually
thereafter, a lead-acid recycling organization to submit a
report with specified information relevant to the
implementation of the plan, including quantification of
lead-acid batteries bought, collected and recycled;
compliance and demonstrations of good faith efforts; among
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other required information. Specifies timeframes for
CalRecycle to review and approve the report.
23) Requires, on or before July 1, 2020, and annually
thereafter, a person that is engaged in business as a
recycler to submit a report to CalRecycle that includes the
number of lead-acid batteries with California recycling
stickers and other information germane to proving
compliance.
24) Requires, on or before July 1, 2020, and annually
thereafter, the operator of a solid waste landfill facility
to report to CalRecycle, if requested, on the number of
used lead-acid batteries with California recycling stickers
received by that facility that were recycled or disposed of
in the preceding calendar year.
25) Requires, when the charge on lead-acid batteries becomes
operative, the manufacturer, recycler, retailer or
distributor to affix a California recycling sticker to each
lead-acid battery at the point of sale.
26) Requires a consumer who returns a lead-acid battery with
a California recycling sticker to a manufacturer, retailer,
or other entity that sells lead-acid batteries to be given
a refund of the recycling charge minus $3. States that $1
of the $3 shall be remitted to the Lead-Acid Battery
Cleanup Fund and the remaining $2 shall be used by the LABO
for administration and implementation of the program. A
consumer returning a lead-acid battery without a sticker is
not eligible for the refund. Requires a retailer that sells
a used lead-acid battery to a manufacturer to remit 75% of
the sale price of the used lead-acid battery to the LABO
for deposit into the Lead-Acid Battery Cleanup Fund.
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27) Requires, on or before March 1, 2018, and annually
thereafter, CalRecycle to post on its Internet Website a
list of manufacturers and recyclers that are in compliance
with this chapter.
28) Authorizes CalRecycle to impose an administrative civil
penalty on any manufacturer, LABO, recycler, or retailer
that is in violation. The penalty shall not exceed $1,000
per day, but if the violation is intentional, knowing, or
reckless, the penalty may go up to $10,000 per day.
Specifies additional administrative actions CalRecycle may
take on noncompliant entities.
29) Establishes the Lead-Acid Battery Recovery and Recycling
Penalty Account and requires all administrative civil
penalties collected to be deposited into that account.
30) Authorizes CalRecycle to adopt emergency regulations to
implement the provisions of this bill.
31) States that any action by a lead-acid battery
organization or its members as it relates to the
requirements of this bill 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.)
32) Authorizes the Lead-Acid Battery Cleanup Fund to repay
any loan made by the General Fund to the Toxic Substances
Control Account during the 2016-17 fiscal year for the
cleanup of lead contamination in the state.
33) Establishes this as an urgency act in order to increase
the cleanup of toxic materials and prevent additional toxic
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pollution at the earliest possible time.
EXISTING LAW:
1) Prohibits the disposal of a lead-acid battery at a solid
waste facility, or on or in any land, surface waters,
watercourses, or marine waters. (Health and Safety Code
(H&S) § 25215.2)
2) Requires retailers to accept the trade-in of a spent
lead-acid battery by a consumer upon purchase of a new one.
(H&S § 25215.3)
3) Governs the management of used lead-acid batteries.
(California Code of Regulations, Title 22, § 66266.80 and
66266.81)
4) Requires all lead-acid batteries purchased by any state
agency for, and, at the next required installation of a
battery in, an automobile or light truck owned or operated
by the state agency, to be a recycled lead-acid battery, to
the extent that all existing stock of nonrecycled batteries
have been utilized. (Public Resources Code (PRC) § 42442)
5) Requires the California Integrated Waste Management
Board (CIWMB, now CalRecycle) to coordinate with DTSC to
develop and implement a public information program to
provide uniform and consistent information on the proper
disposal of hazardous substances found in and around homes,
and to assist the efforts of counties required to provide
household hazardous collection, recycling, and disposal
programs. (PRC § 47050 - 47051)
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6) The CIWMB's duties and responsibilities were transferred
to CalRecycle in 2010. (SB 63, Chapter 21, Statutes of
2009)
7) Establishes the California Used Mattress Recovery and
Recycling Act to reduce illegal dumping, increase
recycling, and substantially reduce public agency costs for
the end-of-use management of used mattresses. Establishes
an industry-run, statewide program to increase the recovery
and recycling of mattresses at their end-of-use. (PRC §
42985)
FISCAL EFFECT: Unknown.
COMMENTS:
Need for the bill: According to the author, "AB 2153 will
reallocate an already imposed fee on almost all car batteries
and create state mandated Lead-Acid (Car) Battery Recycling
program that will include a Stewardship Plan and a Contamination
Abatement program. $1 from the sale of every lead-acid battery
will go to re-pay the $176.6 million loan fund and on-going
programs to ultimately fund clean-up of areas contaminated by
lead-acid batteries."
The problem with lead: Lead has been listed under California's
Proposition 65 since 1987 as a substance that can cause
reproductive damage and birth defects and has been on the list
of chemicals known to cause cancer since 1992. According to the
Office of Environmental Health Hazard Assessment, lead has
multiple toxic effects on the human body. In particular,
decreased intelligence in children and increased blood pressure
in adults are among the more serious non-carcinogenic effects.
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Lead is a probable carcinogen in humans.
Even at low levels, lead may cause a range of health effects
including behavioral problems and learning disabilities.
Children six years old and under are most at risk because this
is when the brain is developing.
There is no level of lead that has been proven safe, either for
children or for adults. Both the U.S. Centers for Disease
Control and Prevention (CDC) and the California Department of
Health Services consider any blood lead level more than 10 g/dl
(micrograms of lead per deciliter of blood) to be unsafe for
children and for pregnant or nursing women.
Lead-acid batteries: According to the U.S. Geological Survey,
the lead-acid battery industry accounted for about 90% of
reported U.S. lead consumption during 2015. Lead-acid batteries
fall into two primary categories: starting, lighting and
ignition (SLI) batteries and industrial batteries. SLI
batteries, which account for 83% of the battery sector, are used
in most on-road vehicles, such as passenger vehicles, light
trucks, buses, commercial vehicles and motorcycles. SLI
batteries are also used in tractors, marine craft, aircraft and
military vehicles.
According to the California Board of Equalization's estimates,
based on 2012 Census data, lead-acid car battery sales in
California are approximately $1.6 billion. That is based on an
estimate of roughly 16 million batteries sold at an average cost
of $100.
According to the Department of Motor Vehicles, as of 2012, there
were more than 33.5 million total vehicles registered in
California.
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Exide Technologies: The Exide Technologies (Exide) battery
recycling facility in Vernon, California recycled lead from used
automotive batteries and other sources. The facility could
process about 25,000 automotive and industrial batteries a day,
providing a source of lead for new batteries. Over the course
of decades of operation, the facility polluted the soil beneath
it with high levels of lead, arsenic, cadmium and other toxic
metals. It also has contaminated groundwater, released battery
acid onto roads and contaminated homes and yards in surrounding
communities with lead emissions. In March, 2015, Exide was
forced to close the facility for good and, under a state
agreement with DTSC, set aside $7.7 million to test homes and
other structures around the facility for pollution resulting
from the facility.
DTSC estimates homes between 1.3 and 1.7 miles away from the
facility may potentially be affected by Exide's lead
contamination - that equates to somewhere between 5,000 - 10,000
residential properties. Cleaning each home costs about $45,000,
according to DTSC. If the cleanup grows to thousands of
properties, it could cost hundreds of millions of dollars.
Removing lead-contaminated soil from thousands of homes
surrounding Exide could result in the most extensive cleanup of
its kind in California and will be among the largest cleanup
ever conducted in the nation. At the end of the day, the cost of
cleanup in and around the Exide facility is expected to top $500
million dollars.
In February, 2016, Governor Jerry Brown announced a budget
proposal for funding cleanup in the polluted communities
surrounding the shuttered Exide facility. The proposal includes
making $176.6 million available to DTSC to expedite and expand
testing and cleanup of residential properties, schools, daycare
centers and parks in the 1.7 mile radius around the facility and
remove contaminated soil at the properties that have the highest
lead levels and greatest potential to expose residents.
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After the $176.6 million is expended, DTSC will need additional
funds to do complete and thorough cleanup. This bill is intended
to fill that gap while providing an ongoing source of funds to
address future lead contamination from lead-acid batteries.
Use of proposed battery charge revenues: AB 2153 would require a
LABO to establish and add a charge to the purchase price of a
lead-acid battery at the point of sale, and would authorize use
of the battery charge revenues to provide a continuous
appropriation to DTSC for the cleanup of areas of the state that
have been contaminated by the production, recycling, or improper
disposal of lead-acid batteries and activities.
In addition, should the Legislature approve the $176.6 General
Fund appropriation toward the Exide cleanup, AB 2153 would
authorize funds in the Lead-Acid Battery Cleanup Fund to be used
towards repaying the General Fund loan.
Under current law, DTSC is authorized to incur direct cleanup
costs and oversight costs in remediating contaminated
properties, and then bill responsible parties for those costs.
As it relates to the lead-contaminated communities surrounding
the Exide facility, the state will pay for and conduct much of
the cleanup, and then bill Exide and any other identified
responsible party (RP) for the cleanup costs for reimbursable
costs. Those bills, once paid by the RP(s), will, in effect, be
a repayment on the General Fund loan. However, it is likely that
a portion of the cleanup may not be attributable to any
identifiable responsible party; in other words, a portion of the
cleanup may be considered "orphan" share cleanup that the state
(taxpayers) is responsible for remediating and funding. In that
case, it may be most appropriate to clarify that funds from the
charge accrued under this bill and deposited into the Lead-Acid
Battery Cleanup Fund may only be used to fund any cleanup costs
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where there is no responsible party.
Core battery charges: According to a 2007 contracted report to
the California Integrated Waste Management Board (CIWMB, which
is now CalRecycle), Framework for Evaluating End-of-Life Product
Management Systems in California, the need to have disposal
options for lead-acid batteries lead to an industry response by
BCI to promote model legislation for states to enact. That
resulted in a model that included a landfill ban, a mandatory
retailer-take back system, and mandatory collection of deposit
on the purchase of a new battery if an old battery is not
returned. California adopted a modified version of the model
legislation in 1989 with only two of those components:
1. Prohibit the disposal of a lead-acid battery at a solid
waste facility, or on or in any land, surface waters,
watercourses, or marine waters (H&S § 25215.2); and,
2. Require that retailers accept the trade-in of a spent
lead-acid battery by a consumer upon purchase of a new one.
(H&S § 25215.3)
California's laws, therefore, do not identify that a deposit
should be added to the sale of batteries. Despite the lack of a
deposit requirement, most retailers voluntarily charge a deposit
as an incentive to get the batteries returned, and the deposit
charge varies (usually between $15-$18). If a used battery is
returned to the retailer at the time of purchase of a new
battery, the deposit is usually waived. The deposit is
considered a "core" charge, or deposit.
Since it is illegal to dispose of lead-acid batteries in
California landfills, and all retailers that sell lead-acid
batteries must accept their return for disposal, the core charge
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gives retailers a tool to comply with those laws by
incentivizing consumers to return their batteries. However, a
statutorily mandated deposit could substantially increase
lead-acid battery collection rates, which in turn will require
management of that waste.
Are consumers getting the short end of the stick under the
voluntary core charge? When it comes to consumer outreach, it is
industry practice to disclose the core charge so customers know
what they are paying; this is usually done by listing the
deposit as a line-item on a receipt. It's also business
practice, per the BCI model, to include signage alerting
consumers about the take-back of the used batteries, but
California chose not to adopt that latter standard when it
enacted H&S § 25215. Therefore, consumers are paying the deposit
in California at many retail locations, but many may not be
aware they can return their used car batteries back to those
retailers.
In addition, lead-acid batteries have an average life-span of
five years. According to the author's office, the issue with the
current practice is that retailers typically do not accept spent
lead-acid batteries for disposal without a receipt. Most
consumers do not keep receipts for five years, which means those
retailers are then keeping the entirety of the deposit and
charging the deposit again when the consumer has to purchase a
new battery. Since there is no law establishing the deposit,
retailers profit off each additional lead-acid battery when the
manufacturer drops off new batteries and picks up their primary
source of lead, the old lead-acid batteries collected by the
retailers.
AB 2153 would allow a consumer returning a spent lead-acid
battery to receive the deposit as long as it's a covered
lead-acid battery with an appropriate California recycling
sticker, which would make it more conducive to refunding the
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deposit.
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.
Precedent on batteries: Up until February 8, 2006, California
residents were allowed to throw away used household batteries in
the trash. However, since then, all batteries have been
considered hazardous waste and have been prohibited from every
solid waste stream in the state. All batteries must be recycled,
or taken to a household hazardous waste disposal facility, a
universal waste handler, or an authorized recycling facility.
According to a University of California 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, "batteries represent a reasonable opportunity for
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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."
This philosophy is applicable to lead-acid batteries.
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 rechargeable 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.
This is a precedent for establishing a similar framework for
lead-acid batteries.
The aforementioned 2007 contracted CIWMB report stated that
automobile lead-acid batteries contain, on average, 17 pounds of
lead, 1.5 gallons of sulfuric acid and 1.6 pounds of
polypropylene (plastic). According to representatives in the
battery industry, lead-acid batteries are at least 99% percent
recyclable including the lead, sulfuric acid, and plastic. As
there are no longer lead ores in the country, recycled lead acid
batteries are the primary source of materials for new lead acid
batteries.
Getting everyone to play the game: Collections and recycling
historically of spent products have been supported by voluntary
product stewards; however, companies that don't voluntarily fund
recycling programs unfairly benefit from them. These products
end up being recycled along with those from manufacturers who
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voluntarily provide for the management of end-of-life of the
products they put into the marketplace.
Non-participants threaten the financial viability of product
stewardship programs by increasing unsupported costs. They also
create an unequal playing field whereby responsible businesses
bear the burden that should be supported by all businesses in
the technology/battery sectors.
Call2Recycle, a battery stewardship organization, estimates that
about 30 percent of the waste batteries collected in their
program come from these non-participants, or "free riders," and,
as the number of collections increase, the problem grows.
Establishing a state-mandated fee-for-recycling will compel all
lead-acid battery manufacturers to comply with the requirements
sort forth in this bill and prevent an ongoing patchwork of
retailer participation, as is the case under the current core
charges.
Arguments in support: According to Californians Against Waste,
AB 2153 "creates a lead-acid battery recycling program dedicated
to ? strategies for managing and reducing life-cycle impacts of
lead-acid batteries, and conducting research to improve
collection and recycling for used lead-acid batteries."
Arguments in opposition: According to the Auto Care Association,
California Automotive Wholesalers' Association, and Coalition
for Auto Repair Equality, this bill seeks to "fix" a process
that isn't broken; 99.6% of all lead-acid core batteries are
recycled in California without government intervention,
suggesting legislation is not necessary, and in fact, intrusive.
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Technical amendments:
1. A secondary goal of AB 2153 is to replace the existing
industry core charge with a statutory charge. The committee
may wish to consider adding language to clarify the charge
required under this bill shall supplant any voluntary core
charge currently being charged to prevent a consumer from
being charged two times by a retailer.
2. Clarify that funds from the charge accrued under this
bill and deposited into the Lead-Acid Battery Cleanup Fund
may only be used to fund any share of cleanup costs
attributed to the Exide Technologies cleanup site and
surrounding communities where there is no identifiable
responsible party.
3. Section 42420(b) expresses the intent of the Legislature
that existing lead-acid battery recycling operations that
are in compliance with state and federal law shall not be
adversely affected by this chapter. To prevent any
unintended interpretation of that section, the committee
may wish to consider a technical amendment to clarify that
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CalRecycle may not use claims regarding compliance with
requirements not directly mandated by AB 2153 to find an
entity has not complied with the provisions of AB 2153.
Related legislation:
1. SB 93 (De Léon) would appropriate $176.6 million for
Exide pollution cleanup. It is pending before the Senate
Budget Committee.
2. AB 118 (Santiago) also proposes to enact the $176.6
million appropriation for Exide pollution cleanup. It is
pending before the Senate Budget Committee.
REGISTERED SUPPORT / OPPOSITION:
Support
Action Now
AMVETS
Apostolic Faith Center
Californians Against Waste
California Communities Against Toxics
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California League of Conservation Voters
California Kids IAQ
California Product Stewardship Council
California Safe Schools
Central California Environmental Justice Coalition for Clean Air
Coalition for a Safe Environment
Community Dreams
Comité Pro Uno
Network
Del Amo Action Committee
Desert Citizens Against Pollution
Exide Access Outreach Project
Greenaction for Health and Environmental Justice
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Health Homes Collaborative
Jordan Downs EJ Coalition
Organización Deportiva BSLCA
Our Right to Know
Philippine Action Group for the Environment
Sierra Club California
Society for Positive Action
Valley Improvement Projects
Watts Labor Community Action Committee
West Berkeley Alliance for Clean Air and Wilmington Improvement
Network
Safe Jobs
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Opposition
Auto Care Association
California Automotive Wholesalers' Association
California New Car Dealers Association
Coalition for Auto Repair Equality (CARE)
Analysis Prepared by:Paige Brokaw / E.S. & T.M. / (916) 319-3965