BILL ANALYSIS
AB 87
Page 1
Date of Hearing: May 6, 2009
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Kevin De Leon, Chair
AB 87 (Davis) - As Amended: April 27, 2009
Policy Committee: Natural
ResourcesVote:6-3
Urgency: No State Mandated Local Program:
No Reimbursable: No
SUMMARY
This bill restricts grocery and convenience stores from
providing single-use carry out bags to their customers.
Specifically, this bill:
1)As of July 1, 2010, prohibits grocery and convenience stores
and pharmacies, as defined, from providing single-use carryout
bags, to customers without charging a sales tax-free fee of 25
cents per bag (the Bag Pollution Cleanup Fee).
2)Exempts from the fee customers participating in certain
low-income assistance programs.
3)Allows stores charging the fee to retain a portion of the
amount generated by the fee to pay for implementation of the
requirements of the bill, including educational programs and
donation of reusable bags to community groups, nonprofits, and
similar entities.
4)Creates the Bag Pollution Fund, available for annual
legislative appropriation to the Integrated Waste Management
Board for state programs for litter cleanup and source
reduction and for grants to cities and counties for those same
purposes.
FISCAL EFFECT
1)One-time costs, about $300,000 in 2010-11, to the board to
establish the program required by this bill. (IWMA.)
2)About $600,000 ongoing annually, starting in 2012-13, to
AB 87
Page 2
enforce these provisions. (IWMA.)
3)Ongoing annual costs in the range of several hundreds of
thousands of dollars to the Board of Equalization (BOE),
starting in 2009-10, for collection of the bag fee. These
costs would be covered by the portion of the bag fee set aside
in the bill for BOE.
4)Unknown, potentially significant proceeds from the fee,
perhaps in the millions of dollars annually, to the Bag
Pollution Fund.
5)Unknown, potentially significant private proceeds, perhaps in
the millions of dollars annually, for the stores that collect
the fee and retain a portion to cover their costs of
implementing this provision.
COMMENTS
1)Rationale. The author contends the volume of plastic bags
distributed to customers by grocery and convenience stores and
pharmacies needs to be reduced significantly to reduce the
volume of plastic bags that enter landfills and are disposed
of illegally as litter or marine debris. The author notes that
California uses over 19 billion plastic bags a year but
recycles less than five percent of those bags. The author also
cites significant costs associated with disposing of plastic
bags in landfills and cleaning up litter. The bill is
supported by many municipal governments and a wide variety of
environmental and conservation groups.
Opponents claim that the fee imposed by this bill is actually
a tax because the burden will be disproportionably borne by
one group of individuals-customers of certain retail
stores-rather than proportionally by all individuals who
contribute to plastic bag litter.
2)Related Legislation.
a) AB 68 (Brownley), similar to this bill, would place a
25-cent fee on single-use carryout bags. AB 68 won passage
in Natural Resources Committee on a vote of 6-3.
b) AB 2058 (Levine) would have prohibited the free
AB 87
Page 3
dispensing of carryout plastic bags by a store to its
customers, unless the store can demonstrate to the
California Integrated Waste Management Board (CIWMB) that
35% and 70% of the plastic bags it dispensed in 2007 have
been diverted from the waste stream by July 1, 2011 and
July 1, 2012, respectively. Assembly Appropriations
identified approximate one-time costs of $600,000 and
approximate ongoing costs of $600,000 associated with this
bill, and noted the potential for the fee required by the
bill to raise millions of dollars. AB 2058 died in Senate
Appropriations.
c) AB 2449 (Levine) - Chapter 845, Statutes of 2006
requires supermarkets and drug stores to establish plastic
bag recycling programs. AB 2449 also pre-empted local
governments from enacting fees on plastic bag use.
3)Bag Fee. This bill requires stores to charge consumers a
25-cent fee per bag on all carryout bags. While such a fee
could generate substantial revenue statewide if consumers
continue to use carryout bags unabated, it is likely that many
consumers will bring reusable bags instead of paying the fee.
This fee would be charged and collected by stores and then
used by those same stores to cover their own carryout bag
costs, including public service announcements and reusable bag
donations. In any case, until January 1, 2013, a store may
not retain more than five cents for each single-use carryout
bag and ten cents for each green carryout bag, which the bill
defines as a nonreusable bag having specified amounts of
postconsumer content and having certain compostable
characteristics. After January 1, 2013, the board will
determine what amount of fee proceeds, if any, may be retained
by stores.
Any proceeds remaining will be transferred to the Bag
Pollution Fund for local plastic bag reduction, cleanup, waste
reduction and recycling efforts, upon appropriation.
Analysis Prepared by : Jay Dickenson / APPR. / (916) 319-2081