BILL NUMBER: SB 1178 CHAPTERED
BILL TEXT
CHAPTER 624
FILED WITH SECRETARY OF STATE OCTOBER 5, 1995
APPROVED BY GOVERNOR OCTOBER 4, 1995
PASSED THE SENATE SEPTEMBER 15, 1995
PASSED THE ASSEMBLY SEPTEMBER 14, 1995
AMENDED IN ASSEMBLY SEPTEMBER 12, 1995
AMENDED IN ASSEMBLY SEPTEMBER 5, 1995
AMENDED IN ASSEMBLY AUGUST 28, 1995
AMENDED IN SENATE JULY 10, 1995
AMENDED IN SENATE JUNE 8, 1995
AMENDED IN SENATE MAY 22, 1995
AMENDED IN SENATE MAY 16, 1995
AMENDED IN SENATE APRIL 3, 1995
INTRODUCED BY Senator O'Connell
(Coauthors: Assembly Members Olberg and Sher)
FEBRUARY 24, 1995
An act to amend Sections 14510, 14513.2, 14513.4, 14518.5,
14526.6, 14529.5, 14537, 14538, 14539, 14549, 14549.6, 14550, 14553,
14560, 14571.8, 14572, 14573, 14573.5, 14575, 14580, 14581, 14585,
and 14591.4 of, to add Sections 14515.5, 14518.4, 14528.1, 14536.1,
14580.5, and 14596 to, to repeal Sections 14509.2, 14541.5, 14563,
and 14581.5 of, and to repeal and add Section 14575.1 of, the Public
Resources Code, relating to beverage containers, making an
appropriation therefor.
LEGISLATIVE COUNSEL'S DIGEST
SB 1178, O'Connell. Beverage containers.
(1) Existing law, the California Beverage Container Recycling and
Litter Reduction Act, requires a distributor of certain beverage
containers to pay a redemption payment to the Department of
Conservation, for each beverage container, as defined, sold or
transferred, for deposit in the California Beverage Container
Recycling Fund. The act provided for the review of the amount of the
redemption payments by the department, until January 1, 1993, and
for an increase or decrease in those payments, if the department made
a specified determination. The money in the fund is continuously
appropriated to the department to pay refund values and for other
purposes. The act requires that, after all expenditures have been
made from the fund, the balance in the fund may be expended by the
department for specified purposes, including up to $18,500,000
annually, until January 1, 1996, for the payment of handling fees to
a supermarket site of not more than $2,300 per month. The act
requires the department to make one-time payments for each of the
1993-94 and 1994-95 fiscal years from the fund to local agencies with
curbside programs for each container collected and properly reported
to the department by processors, limited to a total of $1,000,000
per fiscal year. A violation of the act is a crime and the penalties
for a violation of the act are required to be deposited in the fund.
The act requires a processor to report specified information to
the department. Under the act, the department is required to
calculate a processing fee for each beverage container with a
specified scrap value, which is required to be paid by beverage
manufacturers for each beverage container sold or transferred to a
dealer. Under existing law, the processing fee is imposed if the
scrap value for the beverage container material is less than the sum
of the actual cost of recycling for certified recycling centers and a
reasonable financial return for recycling centers. A processing fee
is not imposed on a plastic beverage container if a willing
purchaser offers to purchase empty plastic beverage containers for
equal to or less than the recycling cost. The act requires the
department to deposit all amounts paid as processing fees for glass
beverage containers in the Glass Processing Fee Account, which may be
expended by the department to pay processing fees to processors for
redeemed glass beverage containers and to establish a market
development program, which includes making market development
payments to container manufacturers and processors who use cullet.
Existing law requires that there be at least one certified
recycling center within every convenience zone in the state. The
department is authorized to grant an exemption from this requirement,
pursuant to specified criteria, which cannot exceed 25% of the total
number of convenience zones. The department is required to conduct
a public hearing before granting such an exemption.
This bill would define the terms "voluntary artificial scrap
value," "PET container," and "processing payment" for purposes of the
act. The bill would, for purposes of the act, redefine the terms
"dealers," "glass container manufacturer," "handling fee," and
"supermarket site" as specified, and would revise the definition of
the term "processing fee" to instead include only the amount paid by
beverage manufacturers to the department. The bill would repeal an
obsolete definition.
The bill would repeal the authority of the department to certify
nonprofit dropoff programs.
The bill would authorize the department to review and decrease or
increase redemption payments based on a specified determination,
thereby imposing a tax for purposes of Article XIIIA of the
California Constitution.
The bill would increase the number of exemptions which the
department may grant from convenience zone requirements to 35% of the
total number of convenience zones. The bill would revise the
criteria for granting those exemptions and would delete the
requirement for a public hearing before granting an exemption.
The bill would require the department to pay annually a total of
$5,000,000 to operators of curbside programs, thereby making an
appropriation.
The bill would require a processor to report additional
information to the department and would require the department to
treat all information reported by processors as commercial or
financial information which is subject to specified procedures.
The bill would, until January 1, 1999, require a processing fee to
be imposed annually only if the scrap value for the material is less
than the cost of recycling. The bill would require the department
to calculate the processing fee so that the processing payment for
glass and bimetal containers to beverage manufacturers is equal to a
specified amount. The bill would require the department to establish
a processing fee for PET containers only if the scrap value for
these containers is less than a specified amount, based on a survey
conducted by the department, but with a recycling cost not less than
$770 or more than $900, as specified. The bill would allow the
department to reduce the amount of the processing fee, under
specified circumstances, and to adjust the amount of the payment, if
the department makes a specified determination. The bill would allow
the department, if it determines that it is necessary to adopt or
amend regulations to implement those changes in calculating
processing fees and processing payments, to adopt or amend those
regulations as emergency regulations.
After January 1, 1999, the bill would provide for the processing
fee to be calculated in the same manner as existing law.
The bill would prohibit the department from imposing a processing
fee on PET containers if a willing purchaser offers to purchase these
containers at a voluntary artificial scrap value, as specified.
The bill would repeal the requirement that the department
establish a market development program, including the payment of
market development payments.
The bill would create the PET Processing Fee Account and the
Bimetal Processing Fee Account in the fund and would require the
department to transfer, over the course of each calendar year, an
amount equal to 25% of the redemption payments paid for that
beverage container type in the prior calendar year, except as
specified, and all amounts paid as processing fees paid for that
beverage container type, into the Glass Processing Fee Account, PET
Processing Fee Account, or the Bimetal Processing Fee Account, as
applicable. The bill would continuously appropriate the money in
those accounts to the department for purposes of making processing
payments for, and reducing processing fees paid for, that type of
beverage container, except as specified.
The bill would extend the payment of the handling fees until
January 1, 1999, thereby making an appropriation, would decrease the
amount that may be paid to a supermarket site to $2,000 and would
revise the method of determining the amount of eligible containers
for which the handling fee may be paid. The bill would require the
department to convene an informal hearing concerning the paying of
handling fees.
The bill would allow the department to expend an amount which is
5% less than the amount appropriated for administrating the act in
the annual Budget Act for the 1995-1996 fiscal year, and would make a
statement of legislative intent with regard to reducing the amount
to be appropriated by 6 2/3% for administration for future fiscal
years.
(2) Existing law requires each glass container manufacturer to use
a specified minimum percentage of California postfilled glass in the
manufacturing of glass food, drink, or beverage containers, and
provides for increasing percentages on and after specified dates,
including 35% on and after January 1, 1996, 45% on and after January
1, 1999, 55% on and after January 1, 2000, and 65% on and after
January 1, 2002. Existing law provides for reductions in the maximum
65% that is required after January 1, 2005, and for granting of
waivers or reductions by the department, if the department determines
the percentage requirements are technologically infeasible.
This bill would instead require a glass container manufacturer in
the state to use a 35% minimum amount of postfilled glass, measured
in the aggregate on an annual basis, and would allow the department
to additionally grant a glass container manufacturer a reduction or
waiver if the department determines there is a lack of available
glass cullet.
(3) The bill would impose a state-mandated local program by
creating new crimes.
(4) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
Appropriation: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 14509.2 of the Public Resources Code is
repealed.
SEC. 2. Section 14510 of the Public Resources Code is amended to
read:
14510. "Dealer" means a retail establishment which offers the
sale of beverages in beverage containers to consumers. However, any
lodging, eating, or drinking establishment, or soft drink vending
machine operator who engages in the sale of beverages in beverage
containers to consumers shall not be deemed a dealer for the purposes
of this division, except that these sales are subject to Section
14560. To determine which retail establishments are dealers, the
department shall use annual or more frequent updates provided by
American Business Information, Inc., as long as the information
provided by American Business Information, Inc., is updated at least
annually.
SEC. 3. Section 14513.2 of the Public Resources Code is amended to
read:
14513.2. (a) Except as provided under Section 14549, "glass
container manufacturer" means a person who manufactures commercial
containers, whose principal component part or parts consist of virgin
glass, postfilled glass, or any combination of both, for sale in
California or for export to other states or countries.
(b) "Glass container manufacturer" includes, but is not limited
to, all commercial manufacturing operations which produce beverage
containers, food or drink packaging material made primarily of glass,
or any combination of both of those items. For beer and other malt
beverages manufactured outside the state, the container manufacturer
shall be deemed to be the person or entity named on the certificate
of compliance issued pursuant to Section 23671 of the Business and
Professions Code.
SEC. 4. Section 14513.4 of the Public Resources Code is amended to
read:
14513.4. "Handling fee" means an amount paid to an operator of a
supermarket site located in a convenience zone for every beverage
container redeemed either by the operator at the supermarket or
within the zone in which the supermarket site is located.
SEC. 4.5. Section 14515.5 is added to the Public Resources Code,
to read:
14515.5. "PET container" means a plastic beverage container
subject to this division.
SEC. 5. Section 14518.4 is added to the Public Resources Code, to
read:
14518.4. "Processing fee" means the amount paid by beverage
manufacturers to the department pursuant to Section 14575.
SEC. 6. Section 14518.5 of the Public Resources Code is amended to
read:
14518.5. "Processing payment" means an amount paid to processors,
dropoff or collection programs, curbside programs, and recycling
centers by the department pursuant to subdivision (a) of Section
14573 and subdivision (a) of Section 14573.5 when the department
determines that the scrap value being offered by container
manufacturers, beverage manufacturers, or willing purchasers for a
particular container material is insufficient to insure the economic
recovery of the container type at the minimum number of recycling
centers or locations required pursuant to Section 14571. The
processing payment shall be determined by the department pursuant to
Section 14575.
SEC. 7. Section 14526.6 of the Public Resources Code is amended to
read:
14526.6. "Supermarket site" means any certified recycling center
which redeems all types of empty beverage containers in accordance
with Section 14572, and which is located within, or outside and
immediately adjacent to the entrance of, or at, or within a parking
lot or loading area surrounding, a supermarket which is the focal
point of a convenience zone, or a dealer that is located within that
zone, and which is accessible to motor traffic.
SEC. 8. Section 14528.1 is added to the Public Resources Code to
read:
14528.1. "Voluntary artificial scrap value" means a price paid by
a willing purchaser of empty PET containers, pursuant to Section
14575.1, that, when combined with payments made from the PET
Processing Fee Account pursuant to subdivision (f) of Section 14575,
is equal to, or more than, the recycling cost for empty PET
containers, as determined in subdivision (d) of Section 14575.
SEC. 9. Section 14529.5 of the Public Resources Code is amended to
read:
14529.5. Any action to increase recycling taken by the
department, or by any person or entity, affecting scrap values, the
quantities of materials being recycled, or the method of invoicing
the sale of beverages pursuant to this division is not a violation of
the Cartwright Act (Chapter 2 (commencing with Section 16700) of
Part 2 of Division 7 of the Business and Professions Code) and the
Unfair Practices Act (Chapter 4 (commencing with Section 17000) of
Part 2 of Division 7 of the Business and Professions Code). This
section does not apply to any action taken by a recycling center to
increase the recycling of beverage containers.
SEC. 10. Section 14536.1 is added to the Public Resources Code, to
read:
14536.1. Notwithstanding Section 14536, if the department
determines that it is necessary to adopt or amend regulations to
implement Section 14575, the department may adopt or amend those
regulations as emergency regulations. The Office of Administrative
Law shall consider those regulations to be necessary for the
immediate preservation of the public peace, health and safety, and
general welfare for purposes of Section 11349.6 of the Government
Code. Notwithstanding subdivision (e) of Section 11346.1 of the
Government Code, the emergency regulations adopted or amended
pursuant to this section shall be repealed 180 days after the
effective date of the regulations, unless the department complies
with Chapter 3.5 (commencing with Section 11340) of Part 1 of
Division 3 of Title 2 of the Government Code.
SEC. 11. Section 14537 of the Public Resources Code is amended to
read:
14537. The department shall keep accurate books, records, and
accounts of all of its dealings, and these books, records, and
accounts are subject to an annual audit by an auditing firm selected
by the department. The auditing firm or the department shall also
conduct a selective audit of entities making payments to, or
receiving payments from, the department to determine whether
redemption payments and applicable processing fees are being paid to
the department on all beverage containers sold in California, and
that refund values and processing payments are being paid out
properly by the department. The audit shall be made a part of an
annual report, copies of which shall be submitted to the Governor and
the Legislature.
SEC. 12. Section 14538 of the Public Resources Code is amended to
read:
14538. (a) The department shall certify the operators of
recycling centers pursuant to this section. The director shall
adopt, by regulation, a procedure for the certification of recycling
centers, including standards and requirements for certification.
These regulations shall require that all information be submitted to
the department under penalty of perjury. A recycling center shall
meet all of the standards and requirements contained in the
regulations for certification. The regulations shall require, but
shall not be limited to requiring, that both of the following
conditions be met for certification:
(1) The operator of the recycling center demonstrates, to the
satisfaction of the department, that the operator will operate in
accordance with this division.
(2) The operator of the recycling center shall notify the
department promptly of any material change in the nature of his or
her operations which conflicts with information submitted in the
operator's application for certification.
(b) A certified recycling center shall comply with all of the
following requirements for operation:
(1) The operator of the recycling center shall not pay a refund
value for, or receive a refund value from any processor for, any food
or drink packaging material or any beverage container or other
product which does not have a refund value established pursuant to
Section 14560.
(2) The operator of a recycling center shall take those actions
which satisfy the department to prevent the payment of a refund value
for any food or drink packaging material or any beverage container
or other product which does not have a refund value established
pursuant to Section 14560.
(3) Unless exempted pursuant to subdivision (b) of Section 14572,
a certified recycling center shall accept, and pay at least the
refund value for, all empty beverage containers, regardless of type.
(4) A certified recycling center shall not pay any refund values,
processing payments, or administrative fees to a noncertified
recycler.
(5) A certified recycling center shall not pay any refund values,
processing payments, or administrative fees on empty beverage
containers or other containers which the certified recycling center
knew, or should have known, were coming into the state from out of
the state.
(6) A certified recycling center shall not claim refund values,
processing payments, or administrative fees on empty beverage
containers which the certified recycling center knew, or should have
known, were received from noncertified recyclers or on beverage
containers which the certified recycling center knew, or should have
known, come from out of the state.
(7) A certified recycling center shall prepare and maintain the
following documents involving empty beverage containers, as specified
by the department by regulation:
(A) Shipping reports which are required to be prepared by the
recycling center, or which are required to be obtained from other
recycling centers.
(B) Consumer transaction receipts.
(C) Consumer transaction logs.
(D) Rejected container receipts on materials subject to this
division.
(E) Receipts for transactions with beverage manufacturers on
materials subject to this division.
(F) Receipts for transactions with beverage distributors on
materials subject to this division.
(G) Documents authorizing the recycling center to cancel empty
beverage containers.
(H) Weight tickets.
(8) In addition to the requirements of paragraph (7), a certified
recycling center shall cooperate with the department and make
available its records of scrap transactions when the review of these
records is necessary for an audit or investigation by the department.
(c) The department may recover, in restitution pursuant to
paragraph (5) of subdivision (c) of Section 14591.2, payments made
from the fund to the certified recycling center pursuant to Section
14573.5 which are based on the documents specified in paragraph (7)
and which are not prepared or maintained in compliance with the
department's regulations and which do not allow the department to
verify claims for program payments.
(d) The department may certify a recycling center which will
operate less than 30 hours a week, as specified in subdivision (b) of
Section 14571.
SEC. 13. Section 14539 of the Public Resources Code is amended to
read:
14539. (a) The department shall certify processors pursuant to
this section. The director shall adopt, by regulation, requirements
and standards for certification. The regulations shall require, but
shall not be limited to requiring, that both of the following
conditions be met for certification:
(1) The processor demonstrates to the satisfaction of the
department that the processor will operate in accordance with this
division.
(2) The processor notifies the department promptly of any material
change in the nature of the processor's operations which conflicts
with the information submitted in the operator's application for
certification.
(b) A certified processor shall comply with all of the following
requirements for operation:
(1) The processor shall not pay a refund value for, or receive a
refund value from the department for, any food or drink packaging
material or any beverage container or other product which does not
have a refund value established pursuant to Section 14560.
(2) The processor shall take those actions which satisfy the
department to prevent the payment of a refund value for any food or
drink packaging material or any beverage container or other product
which does not have a refund value established pursuant to Section
14560.
(3) Unless exempted pursuant to subdivision (b) of Section 14572,
the processor shall accept, and pay at least the refund value for,
all empty beverage containers, regardless of type, for which the
processor is certified.
(4) A processor shall not pay any refund values, processing
payments, or administrative fees to a noncertified recycler. A
processor may pay refund values, processing payments, or
administrative fees to any entity which is identified by the
department on its list of certified recycling centers.
(5) A processor shall not pay any refund values, processing
payments, or administrative fees on empty beverage containers or
other containers which the processor knew, or should have known, were
coming into the state from out of the state.
(6) A processor shall not claim refund values, processing
payments, or administrative fees on empty beverage containers which
the processor knew, or should have known, were received from
noncertified recyclers or on beverage containers which the processor
knew, or should have known, come from out of the state. A processor
may claim refund values, processing payments, or administrative fees
on any empty beverage container which does not come from out of the
state and which is received from any entity which is identified by
the department on its list of certified recycling centers.
(7) A processor shall take the actions necessary and approved by
the department to cancel containers to render them unfit for
redemption.
(8) A processor shall prepare or maintain the following documents
involving empty beverage containers, as specified by the department
by regulation:
(A) Shipping reports which are required to be prepared by the
processor or which are required to be obtained from recycling
centers.
(B) Processor invoice reports.
(C) Cancellation verification documents.
(D) Documents authorizing recycling centers to cancel empty
beverage containers.
(E) Processor-to-processor transaction receipts.
(F) Rejected container receipts on materials subject to this
division.
(G) Receipts for transactions with beverage manufacturers on
materials subject to this division.
(H) Receipts for transactions with distributors on materials
subject to this division.
(I) Weight tickets.
(9) In addition to the requirements of paragraph (7), a processor
shall cooperate with the department and make available its records of
scrap transactions when the review of these records is necessary for
an audit or investigation by the department.
(10) The department may recover, in restitution pursuant to
paragraph (5) of subdivision (c) of Section 14591.2, any payments
made by the department to the processor pursuant to Section 14573
which are based on the documents specified in paragraph (8) and which
are not prepared or maintained in compliance with the department's
regulations and which do not allow the department to verify claims
for program payments.
SEC. 14. Section 14541.5 of the Public Resources Code is repealed.
SEC. 15. Section 14549 of the Public Resources Code is amended to
read:
14549. (a) Every glass container manufacturer shall report to the
department each month, by a method as determined by the department,
the amount of total tons of new glass food, drink, and beverage
containers made in California by that glass container manufacturer
and the tons of California postfilled glass used in the manufacturing
of those new containers.
(b) Each glass container manufacturer in the state shall use a
minimum percentage of 35 percent of postfilled glass in the
manufacturing of their glass food, drink, or beverage containers
measured in the aggregate, on an annual basis.
(c) A glass container manufacturer may seek a reduction or waiver
of the minimum postfilled glass percentage required to be used in the
manufacture of glass food, drink, or beverage containers pursuant to
subdivision (b). The department may grant a reduction or waiver of
the percentage requirement if it finds and determines that it is
technologically infeasible for the glass container manufacturer to
achieve the percentage requirement or if the department determines
that a glass container manufacturer cannot achieve the minimum
percentage because of a lack of available glass cullet.
SEC. 16. Section 14549.6 of the Public Resources Code is amended
to read:
14549.6. (a) The department shall, consistent with Section 14581
and subject to the availability of funds, annually pay a total of
five million dollars ($5,000,000) per fiscal year to operators of
curbside programs, pursuant to Section 14509.5. The payments shall
be for each container collected by the curbside programs and properly
reported to the department by processors, based upon all of the
following:
(1) The payment amount shall be calculated based upon the volume
of beverage containers collected by curbside programs and reported to
the department by processors during the reporting period of October
1, to December 31, inclusive, of the fiscal year for which those
payments are made.
(2) The per-container rate shall be calculated by dividing the
total volume of beverage containers collected, as determined pursuant
to paragraph (1), into the sum of five million dollars ($5,000,000).
(3) The amount to be paid to each operator of a curbside program
shall be based upon the per-container rate, calculated pursuant to
paragraph (2), multiplied by the curbside program's total reported
beverage container volume during the period specified in paragraph
(1).
(b) The amounts paid pursuant to this section shall be expended by
operators of curbside programs only for activities related to
beverage container recycling.
(c) The department shall disburse payments pursuant to this
section not sooner than the 11th month of the fiscal year for which
the payments are being made, subject to the availability of funds.
SEC. 17. Section 14550 of the Public Resources Code is amended to
read:
14550. (a) (1) Every processor shall report to the department for
each month the amount of empty beverage containers, by material type
and weight of container or material, excluding refillable beverage
containers, received from recycling centers and curbside programs for
recycling, and the scrap value paid for glass, PET, and bimetal
containers and any beverage container that is assessed a processing
fee. Every processor shall also report to the department for each
month the amount of other postfilled aluminum, glass, and plastic
food and drink packaging materials sold filled to consumers in this
state and returned for recycling. These reports shall be submitted
within 10 days after each month, in the form and manner which the
department may prescribe.
(2) The department shall treat all information reported pursuant
to this section by a processor as commercial or financial information
subject to the procedures established pursuant to Section 14554.
(b) Every distributor who sells or offers for sale in this state
beverages in aluminum beverage containers, nonaluminum metal beverage
containers, glass beverage containers, plastic beverage containers,
or other beverage containers, including refillable beverage
containers of these types, shall report to the department for each
month the number of beverages sold in these beverage containers in
this state which are labeled pursuant to Section 14561, by material
type and size and weight of container or any other method as the
department may prescribe. These reports shall be submitted by the
day when payment is due, consistent with the applicable payment
schedule specified in subdivision (a) of Section 14574, in the form
and manner which the department may prescribe.
(c) Every distributor who sells or offers for sale in this state
beverages in refillable beverage containers and who pays a refund
value to distributors, dealers, or consumers who return these
containers for refilling, shall report to the department for each
month the number of these beverage containers returned empty to be
refilled, by material type and size of container or any other method
which the department may prescribe. These reports shall be submitted
by the day when payment is due, consistent with the schedule
specified in subdivision (a) of Section 14574, in the form and manner
which the department may prescribe.
(d) Notwithstanding subdivision (b), a distributor who elects to
make an annual payment pursuant to subdivision (b) of Section 14574
may, upon the approval of the department, submit the reports required
by this section annually to the department. The reports shall
accompany the annual payment submitted pursuant to Section 14574.
SEC. 18. Section 14553 of the Public Resources Code is amended to
read:
14553. (a) All reports, claims, and other information required
pursuant to this chapter or Sections 14573, 14573.5, 14574, and 14575
and submitted to the department shall be complete, legible, and
accurate, as determined by the department by regulation, and shall be
signed, by an officer, director, managing employee, or owner of the
certified recycling center, processor, distributor, beverage
manufacturer, container manufacturer, or other entity.
(b) The department may inspect the operations, processes, and
records of any entity required to submit a report to the department
pursuant to this division to determine the accuracy of the report and
compliance with the requirements of this division.
(c) A violation of this subdivision is subject to the penalties
specified in Section 14591.
SEC. 19. Section 14560 of the Public Resources Code is amended to
read:
14560. (a) (1) Except as provided in subdivisions (d), (e), (f),
(g), and (h), every beverage distributor shall pay the department,
for deposit into the fund, a redemption payment of two cents ($0.02)
for every beverage container sold or offered for sale in this state
by the distributor.
(2) A beverage container with a capacity of 24 fluid ounces or
more shall be considered as two beverage containers for purposes of
redemption payments and refund values.
(b) Except as provided in subdivision (c), every beverage
container sold or offered for sale in this state has a minimum refund
value of five cents ($0.05) for every two beverage containers
redeemed and two cents ($0.02) for every single or unpaired beverage
container redeemed in a single transaction.
(c) Every beverage container sold or offered for sale in this
state has a minimum refund value of five cents ($0.05) for every
beverage container redeemed, except as provided in subdivision (g),
if the beverage container does not reach the redemption rate for that
type of beverage container, as determined by the procedure set forth
in subdivision (d).
(d) Except as provided in subdivisions (f) and (h), every
distributor shall pay the department for deposit into the fund, a
minimum redemption payment of three cents ($0.03) for every beverage
container sold or offered for sale in this state if both of the
following conditions are met for that specific type of beverage
container:
(1) For the reporting period beginning January 1, 1992, and ending
June 30, 1992, the redemption rate determined pursuant to Section
14551 for that type of beverage container is less than 65 percent.
(2) The average redemption rate for the highest two of any four
reporting periods, the fourth period of which is the period ending
June 30, 1992, is less than 65 percent.
(e) (1) The department shall periodically review the fund to
ensure that there are adequate funds in the fund to pay the refund
values and other disbursements required by this division.
(A) If the department determines, pursuant to a review made
pursuant to paragraph (1), that there may be inadequate funds to pay
the refund values and necessary disbursements required by this
division, the department shall immediately notify the Chairpersons of
the Natural Resources and Wildlife Committee of the Senate, the
Natural Resources Committee of the Assembly, the Budget Committee of
the Assembly, and the Budget and Fiscal Review Committee of the
Senate of the need for urgent legislative action.
(B) On or before 180 days after the notice is sent pursuant to
subparagraph (A), the department may eliminate expenditures from the
fund as necessary, according to the order of priorities specified in
Section 14581, to ensure there are adequate funds in the fund to pay
the refund values and other disbursements required by this division.
(C) If the department determines that there will not be adequate
funds in the fund for the payment of the refund values and other
disbursements required in this division, the department shall
increase the redemption payment by an additional one-half cent
($0.005) for a total redemption payment of two and one-half cents
($0.025) per beverage container. The department shall provide at
least 60 days' notice to distributors of a redemption payment
increase made pursuant to this subparagraph. Prior to increasing
redemption payments, the director shall make available to the public
written findings with supporting data which show the reasons which
necessitate the increase. The findings and supporting data shall be
reviewed by the Department of Finance.
(2) If, at any time after the department has increased the
redemption payment pursuant to subparagraph (C) of paragraph (1), the
department determines that the increase in the redemption payment is
no longer needed to ensure that there are adequate funds to pay the
refund values and other disbursements required by this division for
the ensuing 180 days, plus a 10-percent reserve, the department shall
reduce the redemption payment by not more than one-half cent
($0.005). The department shall provide to distributors at least 60
days' notice of a redemption payment decrease made pursuant to this
paragraph.
(f) Notwithstanding subdivisions (c) and (d), every distributor of
a beverage container shall pay the department for deposit into the
fund, a minimum redemption payment of three cents ($0.03) for every
beverage container sold or offered for sale in this state, and every
beverage container sold or offered for sale in this state has a
minimum refund value of five cents ($0.05) for every beverage
container redeemed, if all of the following conditions are met for
that specific type of
beverage container:
(1) The beverage container type had less than a 2-percent
redemption rate on September 29, 1986.
(2) The department determines that the beverage container type
achieved an increase in redemption rates during each six-month
reporting period.
(3) The type of beverage container maintained an average
redemption rate of at least 60 percent for both the reporting period
of July 1, 1991, to December 31, 1991, and the reporting period of
January 1, 1992, to June 30, 1992.
(4) The type of beverage container is accepted by over 75 percent
of curbside programs in the state.
(5) For the reporting period beginning January 1, 1993, and ending
June 30, 1993, the redemption rate pursuant to Section 14551 for
that type of beverage container is less than 65 percent.
(g) Except as provided in subdivision (h), once any redemption
payment is established for any type of beverage container, the
redemption payment shall not be decreased based upon the redemption
rate.
(h) The redemption payment for a specific type of beverage
container established pursuant to subdivision (d) shall be decreased
to not less than two and one-half cents ($0.025) per beverage
container if the redemption rate for that type of beverage container
is 80 percent or more during all of four consecutive reporting
periods and the refund value for that type of beverage container
shall be five cents ($0.05) for every two beverage containers
redeemed and two cents ($0.02) for every single or unpaired beverage
container redeemed in a single transaction. The decrease shall occur
six months following the end of the fourth reporting period. If the
redemption rate for that type of beverage container thereafter falls
below 65 percent for any two of any four consecutive reporting
periods, the redemption payment for that type of beverage container
shall be increased to three cents ($0.03) per container until a
redemption rate of 80 percent or more, during all of four consecutive
reporting periods, is established for that type of beverage
container and the refund value for that type of beverage container
shall be five cents ($0.05) for each beverage container redeemed.
(i) This section does not apply to any refillable beverage
container.
(j) The repeal and reenactment of this section by Chapter 730 of
the Statutes of 1992 shall not affect any obligations or penalties
imposed by this section, as it read on January 1, 1992.
SEC. 20. Section 14563 of the Public Resources Code is repealed.
SEC. 21. Section 14571.8 of the Public Resources Code is amended
to read:
14571.8. (a) No lease entered into by a dealer after January 1,
1987, may contain a leasehold restriction that prohibits or results
in the prohibition of the establishment of a recycling location.
(b) The director may grant an exemption from the requirements of
Section 14571 for an individual convenience zone only after the
department solicits public testimony on whether or not to provide an
exemption from Section 14571. The solicitation process shall be
designed by the department to ensure that operators of recycling
centers, dealers, and members of the public in the jurisdiction
affected by the proposed exemption are aware of the proposed
exemption. After evaluation of the testimony and any field review
conducted, the department shall base a decision to exempt a
convenience zone on one, or any combination, of the following
factors:
(1) The exemption will not significantly decrease the ability of
consumers to conveniently return beverage containers for the refund
value to a certified recycling center redeeming all material types.
(2) The nearest certified recycling center is within a reasonable
distance of the convenience zone being considered from exemption.
(3) The convenience zone is in the area of a curbside recycling
program that meets the criteria specified in Section 14509.5.
(4) The requirements of Section 14571 cannot be met in a
particular convenience zone due to local zoning or the dealer's
leasehold restrictions for leases in effect on January 1, 1987, and
the local zoning or leasehold restrictions are not within the
authority of the department and the dealer. However, any lease
executed after January 1, 1987, shall meet the requirements specified
in subdivision (a).
(c) The department shall review each convenience zone in which a
certified recycling center was not located on January 1, 1996, to
determine the eligibility of the convenience zone under the exemption
criteria specified in subdivision (b).
(d) The total number of exemptions granted by the director under
this section shall not exceed 35 percent of the total number of
convenience zones identified pursuant to this section.
(e) The department shall include in its annual report prepared
pursuant to Section 14542 a report on curbside recycling programs and
on the potential need for exemption authority additional to that
provided by subdivision (d).
(f) The department may, on its own motion, or upon petition by any
interested person, revoke a convenience zone exemption if either of
the following occurs:
(1) The condition or conditions which caused the convenience zone
to be exempt no longer exists, and the department determines that the
criteria for an exemption specified in this section, or Section 2715
of Title 14 of the California Code of Regulations, are not presently
applicable to the convenience zone.
(2) The department determines that the convenience zone exemption
was granted due to an administrative error.
(g) If an exemption is revoked and a recycling center is not
certified and operational in the convenience zone, the department
shall, within 10 days of the date of the decision to revoke, serve
all dealers in the convenience zone with the notice specified in
subdivision (a) of Section 14571.7.
(h) An exemption shall not be revoked when a recycling center
becomes certified and operational within an exempt convenience zone
unless either of the events specified in paragraphs (1) and (2) of
subdivision (f) occur.
SEC. 22. Section 14572 of the Public Resources Code is amended to
read:
14572. (a) Except as provided in subdivision (b), a certified
recycling center shall accept from any consumer or dropoff or
collection program any empty beverage container, and shall pay to the
consumer or dropoff or collection program the refund value of the
beverage container. The center may pay the refund value based on the
weight of returned containers.
(b) Any recycling center or processor which was in existence on
January 1, 1986, and which refused, as of January 1, 1986, to accept
at a particular location a certain type of empty beverage container
may continue to refuse to accept at the location the type or types of
empty beverage containers that the recycling center or processor
refused to accept as of January 1, 1986. Any certified recycling
center which refuses, pursuant to this subdivision, to accept a
certain type or types of empty beverage containers is not eligible to
receive handling fees unless the center agrees to accept all types
of empty beverage containers and is a supermarket site. This
subdivision does not preclude the certified recycling center from
receiving a handling fee for beverage containers redeemed at
supermarket sites which do accept all types of containers.
(c) The department shall develop procedures by which recycling
centers and processors which meet the criteria of subdivision (b) may
recertify to change the material types accepted.
(d) (1) Only a certified recycling center may pay the refund value
to consumers or dropoff or collection programs. No person shall pay
a noncertified recycler for empty beverage containers an amount
which exceeds the current scrap value for each container type, which
shall be determined in the following manner:
(A) For a plastic or glass beverage container, the current scrap
value shall be determined by the department.
(B) For an aluminum beverage container, the current scrap value
shall be not greater than the amount paid to the processor for that
aluminum beverage container, on the date the container was purchased,
by the location of end use, as defined in the regulations of the
department.
(2) No person may receive or retain, for empty beverage containers
which come from out of state, any refund values, processing
payments, or administrative fees for which a claim is made to the
department against the fund.
(3) Paragraph (1) does not affect curbside programs under contract
with cities or counties.
SEC. 23. Section 14573 of the Public Resources Code is amended to
read:
14573. (a) The department shall pay to a processor, for every
empty beverage container received by the processor from a certified
recycling center, curbside program, or dropoff or collection program,
upon presentation of a completed processor invoice accompanied by a
shipping report from the supplier of the material, in the form
adopted by the department, the sum of all of the following amounts:
(1) The refund value.
(2) One and three-quarter percent of the refund value for
administrative costs.
(3) The processing payment established pursuant to Section 14575.
(b) The department shall make the payment required in subdivision
(a) within two working days of the date that the department is
notified of the delivery or within the time determined by the
department to be necessary and adequate. If the payment is not made
by the Controller to the certified processor within 20 working days
of receipt of the claims schedule, the Controller shall pay the
processor interest at the current prime lending rate for any period
in excess of these 20 working days.
SEC. 24. Section 14573.5 of the Public Resources Code is amended
to read:
14573.5. (a) Except as provided in Section 14573.6, a processor
shall pay to a certified recycling center, dropoff or collection
program, or curbside program, for all types of empty beverage
containers, by type of beverage container, received by the processor
from a recycling center, curbside program, or dropoff or collection
program, upon receipt by the certified processor of a shipping report
from the supplier of the material, in the form adopted by the
regulations adopted by the department, the sum of all of the
following amounts:
(1) The refund value.
(2) One-half of 1 percent of the refund value for administrative
costs.
(3) The processing payment established pursuant to Section 14575.
(b) The processor shall make the payment required in subdivision
(a) within two working days of the date that the processor receives
these empty beverage containers, or within the time which the
department determines to be necessary and adequate. Under the
procedures authorized by the department, the department may authorize
a certified recycling center to cancel containers, and a certified
processor may authorize a certified recycling center to cancel
containers on behalf of the certified processor.
(c) If the department has set up an accounts receivable procedure
or other procedure for seeking the payment of money improperly
obtained by a certified recycling center from the fund, the
department may reimburse the processor for its payments to that
certified recycling center.
SEC. 25. Section 14575 of the Public Resources Code, as amended by
Section 3 of Chapter 1260 of the Statutes of 1993, is amended to
read:
14575. (a) If any type of empty beverage container with a refund
value established pursuant to Section 14560 has a scrap value less
than the cost of recycling, the department shall establish a
processing fee and a processing payment for the container, by the
type of the material of the container.
(b) Notwithstanding subdivision (a), costs to recycle determined
pursuant to paragraph (2) of subdivision (c) and paragraph (2) of
subdivision (d) established by the department on and after January 1,
1996, shall be adjusted annually to reflect changes in the cost of
living, as measured by the Department of Labor or a successor agency
of the United States government.
(c) Except for the adjustments made pursuant to subdivision (b),
the department shall calculate the processing fee in an amount so
that the processing payment will equal sixty-five dollars and
seventy-two cents ($65.72) for each ton of glass containers and three
hundred forty dollars and twenty-six cents ($340.26) for each ton of
bimetal containers, based upon all of the following assumptions:
(1) The estimated average scrap value is thirty dollars ($30) per
ton for glass containers and ten dollars and sixty-seven cents
($10.67) per ton for bimetal containers.
(2) The unmodified cost data for certified recycling centers for
the January 1, 1992, calculation of the processing fee was
ninety-five dollars and seventy-two cents ($95.72) for each ton of
glass containers and three hundred ninety-three dollars and
ninety-three cents ($393.93) for each ton of bimetal containers.
(d) (1) If the scrap value surveyed by the department pursuant to
paragraph (2) of subdivision (k) for PET containers is less than the
recycling cost determined in paragraph (2), the department shall
establish a processing fee and processing payment for each PET
container sold in accordance with the following:
(A) On or before January 1, 1996, the department shall conduct a
survey of a statistically significant sample of certified recyclers,
excluding those recyclers receiving a handling fee, to determine the
statewide weighted average cost to recycle PET containers for the
calendar year 1994. From the recycling centers surveyed, the
department shall exclude those recycling centers that have the
highest costs per ton on a per-site basis and which, when taken
together, comprise no more than 25 percent of the sites included in
the survey. From the data collected for the remaining sites, the
department shall calculate a statewide weighted average cost to
recycle PET containers.
(B) A reasonable financial return.
(2) On and after January 1, 1996, notwithstanding subparagraphs
(A) and (B) of paragraph (1), for the purposes of this section and
Section 14575.1, the department shall use a recycling cost which is
closest to the recycling cost determined pursuant to subparagraphs
(A) and (B) of paragraph (1), but which is not less than seven
hundred and seventy dollars ($770) per ton and not more than nine
hundred dollars ($900) per ton.
(e) Once the annual processing payment has been determined
utilizing the calculations made pursuant to subdivisions (a), (b),
(c), and (d), the actual processing fee paid by beverage
manufacturers, subject to modification pursuant to subdivision (f),
shall be the per-container fee multiplied by the sum of the
following:
(1) An estimate of the number of containers redeemed by recyclers
during the previous calendar year, divided by an estimate of the
number of nonrefillable beverage containers sold or transferred to a
distributor or dealer during the previous calendar year, based on the
latest available data.
(2) Five percentage points (0.05), except that whenever a surplus
of unexpended money exists in the fund sufficient to equal the
estimate of the previous three months, expenditures of processing
payments for each material type as determined by the department, then
zero percentage points (0.00) shall be used.
(f) (1) The department shall reduce the processing fee paid by
beverage manufacturers pursuant to subdivisions (d) and (e), and the
voluntary artificial scrap value paid by a willing purchaser pursuant
to Section 14575.1, by expending the funds in the Glass Processing
Fee Account, the PET Processing Fee Account, and the Bimetal
Processing Fee Account.
(2) The total amount of funds expended in each calendar year to
reduce the amount of processing fees or the voluntary artificial
scrap value paid by a willing purchaser pursuant to Section 14575.1
paid for each container type shall be equal to the funds available in
the Glass Processing Fee Account, the PET Processing Fee Account, or
the Bimetal Processing Fee Account, for each container type and
shall not exceed an amount equal to 25 percent of the redemption
payments projected to be paid by distributors of beverages sold in
that container type for the previous calendar year.
(g) (1) Except as provided in paragraphs (2) and (3), every
beverage manufacturer shall pay to the department the applicable
processing fee for each container sold or transferred to a
distributor or dealer within 40 days of the sale in the form and in
the manner which the department may prescribe.
(2) (A) Notwithstanding Section 14506, with respect to the payment
of processing fees for beer and other malt beverages manufactured
outside the state, the beverage manufacturer shall be deemed to be
the person or entity named on the certificate of compliance issued
pursuant to Section 23671 of the Business and Professions Code. If
the department is unable to collect the processing fee from the
person or entity named on the certificate of compliance, the
department shall give written notice by certified mail to that person
or entity. The notice shall state that the processing fee shall be
remitted in full within 30 days of issuance of the notice or the
person or entity shall not be permitted to offer that beverage brand
for sale within the state. If the person or entity fails to remit
the processing fee within 30 days of issuance of the notice, the
department shall notify the Department of Alcoholic Beverage Control
that the certificate holder has failed to comply, and the Department
of Alcoholic Beverage Control shall prohibit the offering or sale of
that beverage brand within the state.
(B) The department shall enter into a contract with the Department
of Alcoholic Beverage Control, pursuant to Section 14536.5,
concerning the implementation of this paragraph, which shall include
a provision reimbursing the Department of Alcoholic Beverage Control
for its costs incurred in implementing this paragraph.
(3) (A) Notwithstanding paragraph (1), a beverage manufacturer
may, upon the approval of the department, elect to make a single
annual payment of processing fees, if the beverage manufacturer's
projected processing fees for a calendar year total less than one
thousand dollars ($1,000).
(B) An annual processing fee payment made pursuant to this
paragraph is due and payable on or before February 1 for every
beverage container sold or transferred by the beverage manufacturer
to a distributor or dealer in the previous calendar year.
(C) A beverage manufacturer shall notify the department of its
intent to make an annual processing fee payment pursuant to this
paragraph on or before January 31 of the calendar year preceding the
year in which the payment will be due.
(4) The department shall pay the processing payments on redeemed
containers to processors, in the same manner as it pays refund values
pursuant to Sections 14573 and 14573.5. The processor shall pay the
recycling center the entire processing payment representing the
actual cost and financial return incurred by the recycling center, as
specified in subdivision (a).
(h) When assessing processing fees pursuant to subdivision (a),
the department shall assess the processing fee on each container
sold, as provided in subdivision (e), by the type of material of the
container.
(i) The container manufacturer, or a designated agent, shall pay
to, or credit, the account of the beverage manufacturer in an amount
equal to the processing fee.
(j) Prior to the January 1, 1999, recalculation of the processing
fee, the department shall do both of the following:
(1) Consult with container manufacturers, beverage manufacturers,
operators of recycling centers and processing facilities, and other
interested parties concerning the size of the statewide sample,
appropriate sampling methodologies, and other topics of concern
related to the imposition of the processing fee.
(2) At least 60 days prior to the effective date of any new
processing fee, hold a public hearing, after giving notice, to make
available to the public and affected parties the department's
proposed recalculation of the processing fee.
(k) (1) On or before January 1, 1996, and annually thereafter, the
department shall determine the statewide average scrap values paid
by beneficiating and nonbeneficiating processors for glass containers
during the 12-month period ending September 30. If the department
determines that the statewide average scrap values paid for glass
containers is 10 percent or more above or below the scrap value
specified in paragraph (1) of subdivision (c), the department shall
adjust the processing payment to equal the difference between the
cost of recycling, as specified in subdivision (b) and paragraph (2)
of subdivision (c), and the new statewide average scrap value.
(2) On and after January 1, 1996, and every month thereafter, the
department shall make either an upward or downward adjustment of a
processing fee established pursuant to this section for PET plastic
beverage containers if the department determines that the average
statewide scrap values paid by processors, for any monthly period,
are more or less than the average scrap values used as the basis for
the processing fee currently in effect. For the purpose of
calculating the processing fee on January 1, 1996, the department
shall assume an average scrap value of five hundred and sixty dollars
($560) per ton of PET containers for that month only.
(l) This section shall remain in effect only until January 1,
1999, and as of that date is repealed, unless a later enacted
statute, which is enacted before January 1, 1999, deletes or extends
that date.
SEC. 26. Section 14575 of the Public Resources Code, as amended by
Section 4 of Chapter 1260 of the Statutes of 1993, is amended to
read:
14575. (a) If any type of empty beverage container with a refund
value established pursuant to Section 14560 has a scrap value less
than the sum of paragraphs (1) and (2), the department shall
establish a processing fee and a processing payment for the
container, by the type of the material of the container, at least
equal to the difference between the scrap value offered by a
statistically significant sample of container manufacturers, beverage
manufacturers, processors, or willing purchasers, for each container
sold by the beverage manufacturer, and the sum of both of the
following:
(1) The actual cost for certified recycling centers, excluding
those recycling centers receiving a convenience incentive payment,
and certified processors which did not receive convenience incentive
payments in the year in which the processing fee is calculated or
recalculated, of receiving, handling, processing, storing,
transporting, and maintaining equipment for each container sold for
recycling or, only if the container is not recyclable, for disposal,
calculated pursuant to subdivision (c).
(2) A reasonable financial return for recycling centers and
processors, calculated pursuant to subdivision (b).
(b) On January 1, 1999, and annually thereafter, the department
shall calculate weighted statewide average values for the amounts
specified in paragraphs (1) and (2) of subdivision (a) for each type
of container material sold and a new processing fee, which shall be
effective on that same date.
(c) A processing fee established pursuant to this section shall be
based upon all of the following:
(1) The average scrap values paid by willing purchasers during the
1990 calendar year for the initial calculation and the average scrap
values paid by willing purchasers during the calendar year directly
preceding the year in which the processing fee is calculated for any
subsequent calculation.
(2) The latest available data indicating the volumes of beverage
containers collected by certified processors and recycling centers.
(3) The actual recycling costs for certified recycling centers and
processors, as determined pursuant to paragraph (1) of subdivision
(a) for the 1989 calendar year for the initial calculation, and for
the second calendar year preceding the year in which the processing
fee is calculated for any subsequent calculation.
(d) Every six months, or more frequently as determined to be
necessary by the department, the department may adjust a processing
fee established pursuant to this section if both of the following
occur:
(1) The department determines that the average statewide scrap
values paid by willing purchasers are less than the average scrap
values used as the basis for the processing fee calculation.
(2) The department determines that adjusting the processing fee is
necessary to further the objectives of this division.
(e) The calculations of the statewide weighted average values and
processing fee made pursuant to subdivision (b) shall be based on
audited surveys of the costs specified in subdivision (a) at existing
certified recycling centers, reverse vending machines, and
processors, with standardized modifications for transportation
distances and factors specific to a particular region, as determined
by the department, and, if the container is not recyclable, local
disposal fees. The processing fee shall be calculated in a manner
which furthers the purposes of this division and the fee shall be
sufficient to establish sufficient recycling locations and processors
to achieve the goals established pursuant to subdivision (c) of
Section 14501 and Section 14571. Except for the first calculation of
a processing fee made pursuant to this section, 60 days prior to the
annual calculation of the processing fee, the department shall
submit a report to the Chairperson of the Assembly Natural Resources
Committee and the Chairperson of the Senate Natural Resources and
Wildlife Committee. The report shall include a summary of the
fluctuations of costs and scrap values necessitating the
recalculation. The report shall also highlight changes in markets,
new technologies, and other business and economic factors. The
report shall include a description of the average per container
statewide costs of recycling beverage containers, by each material
type, for the following recycling systems, including a description of
any assumptions used to allocate undifferentiated costs among
material types, and a brief statement of the reason for the adoption
of these assumptions:
(1) Automated recycling centers.
(2) Staffed recycling centers.
(3) Recycling centers established since September 29, 1988.
(4) Recycling centers
established prior to September 29, 1988.
(5) Recyclers receiving convenience incentive payments, as
feasible.
(6) Nonprofit dropoff programs.
(7) Curbside recycling programs.
(f) (1) Except as provided in paragraphs (2) and (3), every
beverage manufacturer shall pay to the department the applicable
processing fee for each container sold or transferred to a
distributor or dealer within 40 days of the sale in the form and in
the manner which the department may prescribe.
(2) (A) Notwithstanding Section 14506, with respect to the payment
of processing fees for beer and other malt beverages manufactured
ouside the state, the beverage manufacturer shall be deemed to be the
person or entity named on the certificate of compliance issued
pursuant to Section 23671 of the Business and Professions Code. If
the department is unable to collect the processing fee from the
person or entity named on the certificate of compliance, the
department shall give written notice by certified mail to that person
or entity. The notice shall state that the processing fee shall be
remitted in full within 30 days of issuance of the notice or the
person or entity shall not be permitted to offer that beverage brand
for sale within the state. If the person or entity fails to remit
the processing fee within 30 days of issuance of the notice, the
department shall notify the Department of Alcoholic Beverage Control
that the certificate holder has failed to comply, and the Department
of Alcoholic Beverage Control shall prohibit the offering or sale of
that beverage brand within the state.
(B) The department shall enter into a contract with the Department
of Alcoholic Beverage Control, pursuant to Section 14536.5,
concerning the implementation of this paragraph, which shall include
a provision reimbursing the Department of Alcoholic Beverage Control
for its costs incurred in implementing this paragraph.
(3) (A) Notwithstanding paragraph (1), a beverage manufacturer
may, upon the approval of the department, elect to make a single
annual payment of processing fees, if the beverage manufacturer's
projected processing fees for a calendar year total less than one
thousand dollars ($1,000).
(B) An annual processing fee payment made pursuant to this
paragraph is due and payable on or before February 1 for every
beverage container sold or transferred by the beverage manufacturer
to a distributor or dealer in the previous calendar year.
(C) A beverage manufacturer shall notify the department of its
intent to make an annual processing fee payment pursuant to this
paragraph on or before January 31 of the calendar year preceding the
year in which the payment will be due.
(4) The department shall pay the processing payments on redeemed
containers to processors, in the same manner as it pays refund values
pursuant to Sections 14573 and 14573.5. The department shall pay
the processing fees collected on unredeemed containers into the fund.
The department shall not use processing fees collected on
unredeemed beverage containers to pay all or a portion of the
processing costs determined pursuant to subdivision (a). The
processor shall pay the recycling center that portion of the
processing payment representing the actual cost and financial return
incurred by the recycling center, as specified in subdivision (a).
(g) When assessing processing fees pursuant to subdivision (b),
the department shall assess the processing fee on each container
sold, by the type of material of the container, assuming that every
container sold will be redeemed for recycling, whether or not the
container is actually recycled. When calculating and assessing
processing fees, the department also shall not assume that redemption
bonuses will be kept by recycling centers or locations.
(h) The container manufacturer, or a designated agent, shall pay
to, or credit, the account of the beverage manufacturer in an amount
equal to the processing payment.
(i) This section shall become operative January 1, 1999.
SEC. 27. Section 14575.1 of the Public Resources Code is repealed.
SEC. 28. Section 14575.1 is added to the Public Resources Code to
read:
14575.1. (a) Notwithstanding subdivision (d) of Section 14575, if
a willing purchaser offers to purchase empty PET containers at a
voluntary artificial scrap value that, when combined with payments
made from the PET Processing Fee Account pursuant to subdivision (f)
of Section 14575, is equal to, or more than, the recycling cost for
empty PET containers, as determined in subdivision (d) of Section
14575, no processing fee shall be imposed on PET containers pursuant
to Section 14575.
(b) If a willing purchaser offers to pay a voluntary artificial
scrap value, the department shall, on a monthly basis, determine
whether the sum of the voluntary artificial scrap value and payments
made from the PET Processing Fee Account pursuant to subdivision (f)
of Section 14575, are equal to, or more than, the recycling cost for
empty PET containers determined pursuant to subdivision (d) of
Section 14575.
(c) If the department determines that, for any monthly period, the
sum of the voluntary artificial scrap value and payments made from
the PET Processing Fee Account pursuant to subdivision (f) of Section
14575, is less than the recycling cost for empty PET containers,
determined pursuant to subdivision (d) of Section 14575, the
following requirements shall apply:
(1) The department shall immediately provide written notification
of the deficiency for that monthly period and the amount of that
deficiency to any willing purchaser.
(2) A willing purchaser shall correct the deficiency in the next
monthly period by adjusting the voluntary artificial scrap value by
an amount sufficient to equal the recycling cost for empty PET
containers plus the previous monthly period's deficiency.
(3) If the deficiency and amount in arrears is not corrected
within 30 days of providing written notice to willing purchasers of
empty PET containers, the department shall impose a processing fee
pursuant to Section 14575 which includes any amount necessary,
including any amount in arrears, to cover the cost of recycling empty
PET containers.
(d) If the department determines that, for any monthly period,
the sum of the voluntary artificial scrap value and payments made
from the PET Processing Fee Account pursuant to subdivision (f) of
Section 14575, is greater than the recycling cost for empty PET
containers, the department shall do both of the following:
(1) Immediately provide written notification of the deviation for
that monthly period and the amount of that deviation to any willing
purchaser.
(2) Provide a credit equal to the amount of the deviation for any
future monthly period wherein the voluntary artificial scrap value,
and payments made from the PET Processing Fee Account, are less than
the recycling cost of empty PET containers determined pursuant to
subdivision (d) of Section 14575.
(e) Nothing in this section is intended to affect any pending
litigation in which the department is a party of record.
SEC. 29. Section 14580 of the Public Resources Code is amended to
read:
14580. (a) Except as provided in subdivisions (d), (e), and (f),
the department shall deposit all amounts paid as redemption payments
by distributors pursuant to Section 14574, civil penalties or fines
paid pursuant to Section 14541 or subdivision (c) of Section 14591,
and all other revenues received into the California Beverage
Container Recycling Fund, which is hereby created in the State
Treasury. Notwithstanding Section 13340 of the Government Code, the
money in the fund is hereby continuously appropriated to the
department for expenditure without regard to fiscal year for the
following purposes:
(1) The payment of refund values and administrative fees to
processors pursuant to Section 14573.
(2) For a reserve for contingencies, which shall not be greater
than an amount equal to 5 percent of the total amount paid to
processors pursuant to Section 14573 during the preceding calendar
year, plus any interest earned on that amount.
(b) Except as provided in Section 14580.5, the money in the fund
may be expended by the department for the administration of this
division only upon appropriation by the Legislature in the annual
Budget Act.
(c) After setting aside funds estimated to be needed for
expenditures authorized pursuant to this section, the department
shall set aside funds on a quarterly basis for the purposes specified
in Section 14581. Notwithstanding Section 13340 of the Government
Code, that money is hereby continuously appropriated to the
department, without regard to fiscal year, for the purposes specified
in Section 14581.
(d) Subject to the availability of providing adequate funds to pay
refund values, the department shall, over the course of each
calendar year, transfer from the fund an amount equal to 25 percent
of the redemption payments made for glass beverage containers in the
prior calendar year, and shall deposit all amounts paid as processing
fees pursuant to Section 14575 for glass beverage containers, into
the Glass Processing Fee Account, which is hereby created in the
fund. Notwithstanding Section 13340 of the Government Code, the
money in the Glass Processing Fee Account is hereby continuously
appropriated to the department and shall be available without regard
to fiscal year for purposes of making processing payments for, and
reducing processing fees paid for, glass beverage containers pursuant
to Section 14575.
(e) Subject to the availability of providing adequate funds to pay
refund values, the department shall, over the course of each
calendar year, transfer from the fund an amount equal to 25 percent
of the redemption payments made for PET beverage containers in the
prior calendar year, and shall deposit all amounts paid as processing
fees pursuant to Section 14575 for PET beverage containers, into the
PET Processing Fee Account, which is hereby created in the fund.
Notwithstanding Section 13340 of the Government Code, the money in
the PET Processing Fee Account is hereby continuously appropriated to
the department and shall be available without regard to fiscal year
for purposes of making processing payments for, and reducing
processing fees paid for, PET beverage containers pursuant to Section
14575 and reducing the voluntary artificial scrap value for PET
containers pursuant to Section 14575.1, and for reducing processing
fees for PET containers pursuant to paragraph (3) of subdivision (e)
of Section 14575.
(f) Subject to the availability of providing adequate funds to pay
refund values, the department shall, over the course of each
calendar year, transfer an amount equal to 25 percent of the
redemption payments made for bimetal beverage containers in the prior
calendar year, and shall deposit all amounts paid as processing fees
pursuant to Section 14575 for bimetal beverage containers, into the
Bimetal Processing Fee Account, which is hereby created in the fund.
Notwithstanding Section 13340 of the Government Code, the money in
the Bimetal Processing Fee Account is hereby continuously
appropriated to the department and shall be available without regard
to fiscal year for purposes of making processing payments for, and
reducing processing fees paid for, bimetal beverage containers
pursuant to Section 14575.
SEC. 30. Section 14580.5 is added to the Public Resources Code, to
read:
14580.5. (a) Notwithstanding any appropriation made in the annual
Budget Act, the department may only expend an amount for the
administration of this division which is five percent less than the
amount appropriated for the administration of this division for the
1995-96 fiscal year.
(b) It is the intent of the Legislature that for each fiscal year,
through the 1998-99 fiscal year, the amount appropriated in the
annual Budget Act for the administration of this division shall be
reduced by six and two-thirds percent of the amount appropriated in
the prior fiscal year.
(c) It is the further intent of the Legislature that revenues that
otherwise would have been spent by the department for administration
of this division shall be expended for the purposes set forth in
Section 14581.
SEC. 31. Section 14581 of the Public Resources Code is amended to
read:
14581. (a) Subject to the availability of funds, the department
may expend the money set aside in the fund, pursuant to subdivision
(c) of Section 14580 for the purposes of this section, in the
following order of priority:
(1) Eighteen million five hundred thousand dollars ($18,500,000)
may be expended, until January 1, 1999, for the payment of handling
fees required pursuant to Section 14585.
(2) Five million dollars ($5,000,000) may be expended, until
January 1, 1999, for payments for curbside programs pursuant to
Section 14549.6.
(3) (A) Seven million dollars ($7,000,000), plus the proportional
share of the cost-of-living adjustment, as provided in subdivision
(b), may be expended in the form of grants issued to certified
community conservation corps, that either exist currently, or that
are formed at a future date that are designated by a city or a city
and county to perform litter abatement, recycling, and related
activities, if the city or the city and county has a population, as
determined by the most recent census, of more than 250,000 persons.
(B) Any grants provided pursuant to this paragraph shall not
comprise more than 75 percent of the annual budget of a community
conservation corps.
(4) Two million dollars ($2,000,000), plus the proportional share
of the cost-of-living adjustment, as provided in subdivision (b), may
be expended, in the form of grants to nonprofit organizations or
governmental entities, as determined by the department.
(b) The nine million dollars ($9,000,000) that is set aside
pursuant to paragraphs (3) and (4), is a base amount that the
department shall adjust annually to reflect any increases or
decreases in the cost of living, as measured by the Department of
Labor, or a successor agency, of the federal government.
SEC. 32. Section 14581.5 of the Public Resources Code is repealed.
SEC. 33. Section 14585 of the Public Resources Code is amended to
read:
14585. (a) The department shall adopt guidelines and methods for
paying handling fees to supermarket sites to provide an incentive for
the redemption of empty beverage containers in convenience zones.
The guidelines shall include, but not be limited to, all of the
following:
(1) Handling fees shall be paid on a monthly basis, in the form
and manner adopted by the department. The department shall require
that claims for the handling fee be filed with the department not
later than the first day of the second month following the month for
which the handling fee is claimed as a condition of receiving any
handling fee.
(2) To be eligible for any handling fee, a supermarket site
recycling center shall redeem not less than 60,000 beverage
containers, and, except for operators of certified recycling centers
that are nonprofit organizations, not more than 500,000 beverage
containers, during the calendar month in which the handling fee is
claimed.
(3) A beverage container with a capacity of 24 fluid ounces or
more shall be considered as two beverage containers for purposes of
determining the eligibility percentage, any handling fee
calculations, and payments.
(4) The department shall determine the number of eligible
containers per site for which a handling fee will be paid in the
following manner:
(A) Each supermarket site's combined monthly volume of glass and
plastic beverage containers shall be divided by the site's total
monthly volume of all empty beverage container types.
(B) If the quotient determined pursuant to subparagraph (A) is
equal to, or more than, 20 percent, the total monthly volume of the
site shall be the maximum volume which is eligible for a handling fee
for that month.
(C) If the quotient determined pursuant to subparagraph (A) is
less than 20 percent, the department shall divide the volume of glass
and plastic beverage containers by 20 percent. That quotient shall
be maximum volume that is eligible for a handling fee for that month.
(5) The department shall pay a handling fee of 1.7 cents ($0.017)
per eligible beverage container, as determined pursuant to paragraph
(4).
(6) Notwithstanding paragraph (5), the total handling fee payment
to a supermarket site shall not exceed two thousand dollars ($2,000)
per month.
(7) If the eligible volume in any given month would result in
handling fee payments which exceed the allocation of funds for that
month, as provided in subdivision (b), sites with higher eligible
monthly volumes shall receive handling fees for their entire eligible
monthly volume before sites with lower eligible monthly volumes
receive any handling fees.
(8) (A) If a dealer where a supermarket site is located ceases
operation for remodeling or for a change of ownership, the operator
of that supermarket site shall be eligible to apply for handling fees
for that site for a period of three months following the date of the
closure of the dealer.
(B) Every supermarket site operator shall promptly notify the
department of the closure of the dealer where the supermarket site
is located.
(C) Notwithstanding subparagraph (A), any operator who fails to
provide notification to the department pursuant to subparagraph (B)
shall not be eligible to apply for handling fees.
(b) The department may allocate the eighteen million five hundred
thousand dollars ($18,500,000) authorized for expenditure for the
payment of handling fees pursuant to paragraph (1) of subdivision
(a) of Section 14581 on a monthly basis and may carry over any
unexpended monthly allocation to a subsequent month or months.
However, unexpended monthly allocations shall not be carried over to
a subsequent fiscal year for the purpose of paying handling fees but
may be carried over for any other purpose pursuant to Section 14581.
(c) The department shall not make handling fee payments to more
than one certified recycling center in a convenience zone. If a
dealer is located in more than one convenience zone, the department
shall offer a single handling fee payment to a supermarket site
located at that dealer. This handling fee payment shall not be split
between the affected zones. The department shall stop making
handling fee payments if another recycling center certifies to
operate within the convenience zone without receiving payments
pursuant to this section, if the department monitors the performance
of the other recycling center for 60 days and determines that the
recycling center is in compliance with this division. Any recycling
center that locates in a convenience zone, thereby causing a
preexisting recycling center to become ineligible to receive handling
fee payments, is ineligible to receive any handling fee payments in
that convenience zone.
(d) The department may require the operator of a supermarket site
receiving handling fees to maintain records for each location where
beverage containers are redeemed, and may require the supermarket
site to take any other action necessary for the department to
determine that the supermarket site does not receive an excessive
handling fee.
(e) The department may determine and utilize a standard container
per pound rate, for each material type, for the purpose of
calculating volumes and making handling fee payments.
(f) (1) It is the intent of the Legislature that handling fees
paid to supermarket site recycling centers be only used to offset the
unique costs of providing convenient recycling opportunities to
consumers, and that those fees shall not be expended for the purpose
of engaging in unfair and predatory pricing intended to increase the
recycling of beverage containers at those centers.
(2) To ensure that handling fees, paid to supermarket site
recycling centers, are not used for the purpose of engaging in unfair
and predatory pricing and to otherwise further the intent of
paragraph (1), the department shall, upon the complaint of any person
other than the department, convene an informal hearing before the
director or a designee, in accordance with the following:
(A) At the hearing, the complainant shall present evidence that a
respondent handling fee recipient has engaged in unfair and predatory
pricing and that the complainant has suffered substantial and
quantifiable economic damages as a result of that pricing. Upon the
director's determination that there is credible evidence of unfair
and predatory pricing and of resulting damages, the complainant is
entitled to a rebuttable presumption that the respondent has engaged
in unfair and predatory pricing.
(B) At the hearing, the respondent shall have the opportunity to
respond to the complaint by presenting evidence that the respondent
has not engaged in unfair and predatory pricing and has not caused
any damage to the complainant.
(C) Based upon the evidence presented at the hearing and any
presumption pursuant to subparagraph (A), the director or the
director's designee shall determine if there is clear and convincing
evidence that a violation of this division has occurred, and, if so,
the respondent shall not be eligible to receive handling fees for
three months.
(D) The complainant or respondent may obtain review of the
director's action taken pursuant to this subdivision by filing in the
superior court a petition for writ of mandate within 30 days
following the issuance of the director's decision. Section 1094.5 of
the Code of Civil Procedure shall govern judicial proceedings
pursuant to this subdivision, except that in every case the court
shall exercise its independent judgment. If a petition for a writ of
mandate is not filed within the time limits set by this subdivision,
the director's action under this subdivision shall not be subject to
review by any court or agency.
(E) If either party appeals the director's or designee's decision
pursuant to subparagraph (D), and the department prevails, the
department may recover any costs associated with its defense of the
petition.
(g) This section shall remain in effect only until January 1,
1999, and as of that date is repealed, unless a later enacted
statute, which is enacted before January 1, 1999, deletes or extends
that date.
SEC. 34. Section 14591.4 of the Public Resources Code is amended
to read:
14591.4. (a) In addition to any other remedies, penalties, and
disciplinary actions provided by this division or otherwise, the
department may seek restitution of any money illegally paid to any
person from the fund, plus interest at the rate earned on the Pooled
Money Investment Account of the total amount.
(b) A certificate holder is liable to the department for
restitution pursuant to paragraph (5) of subdivision (c) of Section
14591.2 for payments made by the department to the certificate holder
which are based on improperly prepared or maintained documents, as
specified in paragraph (7) of subdivision (b) of Section 14538 and
paragraph (8) of subdivision (b) of Section 14539.
(c) If the department has a civil cause of action for restitution
pursuant to subdivisions (a) and (b), or if the department has a
civil cause of action against a certificate holder for restitution
under any other circumstance, the department may seek restitution in
a hearing conducted in accordance with Chapter 5 (commencing with
Section 11500) of Part 1 of Division 3 of Title 2 of the Government
Code. The hearing may take place at the same time as a hearing to
impose disciplinary action on a certificate holder.
(d) Notwithstanding subdivisions (b) and (c) of Section 14591.1,
if the department collects amounts in full restitution for money
paid, the department may impose a penalty of not more than one
hundred dollars ($100) for each separate violation, or for continuing
violations, for each day that violation occurs.
SEC. 35. No reimbursement is required by this act pursuant to
Section 6 of Article XIIIB of the California Constitution because the
only costs that may be incurred by a local agency or school district
will be incurred because this act creates a new crime or infraction,
eliminates a crime or infraction, or changes the penalty for a crime
or infraction, within the meaning of Section 17556 of the Government
Code, or changes the definition of a crime within the meaning of
Section 6 of Article XIIIB of the California Constitution.
Notwithstanding Section 17580 of the Government Code, unless
otherwise specified, the provisions of this act shall become
operative on the same date that the act takes effect pursuant to the
California Constitution.