BILL ANALYSIS
AB 2718
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Date of Hearing: April 28, 2010
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 2718 (Adams) - As Amended: April 14, 2010
Policy Committee: Natural
ResourcesVote:8-0
Urgency: No State Mandated Local Program:
No Reimbursable: No
SUMMARY
This bill establishes a definition of "unserved zone" for
purposes of the California Beverage Container Recycling and
Litter Reduction Act and revises the requirements for certified
recycling centers operating in unserved zones. Specifically,
this bill:
1)Defines an "unserved convenience zone" as one in which there
is not an operating recycling center, certified according to
the law.
2)Specifies that a certified beverage container dealer operating
in an unserved convenience zone that redeems empty beverage
containers inside the store is eligible for handling payments
and other payments as though the dealer were a certified
recycling center.
3)Authorizes the department to allow a certified recycling
center to be open for less than 30 hours, but not less than 20
hours, per week if the center is located in an unserved
convenience zone that has been unserved for at least six
continuous months.
FISCAL EFFECT
Costs to the Department of Resource Recovery and Recycling
(DRRR) of approximately $300,000 in 2010-11 and approximately
$500,000 ongoing (Beverage Container Recycling Fund). These
costs would result from increased convenience zone exemption
reviews and fraud investigations.
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COMMENTS
1)Rationale . Existing law provides financial assistance to
ensure recycling centers are conveniently accessible to all
Californians who purchase beverage containers. Despite this
assistance, there are many areas of the state where beverage
containers are sold but where recycling centers do not
operate. This bill seeks to remedy this situation by (a)
specifying that supermarkets and other certified dealers
operating in areas not served by a recycling center may
collect handling fees to cover costs associated with
collecting empty containers and (b) reducing the operating
requirements on certified recycling centers in such areas.
2)Beverage Container Recycling-CRV, Handling Fees and
Convenience Zone Recyclers . The Division of Recycling (DOR)
of DRRR administers the Beverage Container Recycling Program,
commonly referred to as the bottle bill program. This program
was created more than 20 years ago by Chapter 1290, Statutes
of 1986 (AB 2020, Margolin). The program encourages the
voluntary recycling of most beverage containers by
guaranteeing a minimum payment (the "California Redemption
Value" (CRV)) for each container returned to a certified
recycler. Beverage containers are subject to the CRV based on
both the content of the container (the beverage type, such as
water or sports drinks) and the container material (such as
glass or plastic)
To encourage convenient recycling, certain recycling
centers-generally those located in supermarket parking lots
and known as "convenience zone recyclers"-are paid an
additional "handling fee" or subsidy per container recycled.
Despite this incentive payment, hundreds of areas throughout
the state lack convenience zone recycling centers. These
unserved zones discourage recycling, because people must
travel a relatively longer distances to redeem their beverage
containers.
3)Beverage Container Recycling Fund Balance-Too Bad for the
Bottle, Too Bad for the Can . Several years ago, the fund into
which CRV deposits are made-the Beverage Container Recycling
Fund (BCRF)-had fund balances that exceeded the yearly cost of
the bottle bill program by tens of millions of dollars. This
is because Californians recycled beverage containers at a rate
well below 80 %-the rate at which payments into the fund would
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equal payments out of the fund. Much of the excess funds went
to pay for programs to support recycling. In addition, the
excess fund balance was repeatedly loaned, first to the
General Fund and then to the Air Pollution Control Fund to pay
for implementation of the state's greenhouse gas emissions
reduction efforts.
More recently, recycling rates have increased well above 80 %.
At the same time, purchases of beverage containers subject to
the CRV have declined. As a result, the BCRF is unable to
support the programs intended to facilitate recycling. In
response, the Legislature passed AB 8X 7 (Budget Committee) in
March, which provides a one-time influx of $100 million
dollars and temporarily suspends multiple grant programs.
4)Support . This bill is sponsored by the California Grocers
Association, which contends allowing its members to collect
handling fees in unserved zones, and providing flexibility to
recycling centers that would operate in those zones, will
better encourage recycling in areas currently lacking such
facilities.
5)There is no registered opposition to this bill.
Analysis Prepared by : Jay Dickenson / APPR. / (916) 319-2081