BILL ANALYSIS �
AB 525
Page 1
Date of Hearing: May 4, 2011
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 525 (Gordon) - As Amended: April 25, 2011
Policy Committee: Natural
ResourcesVote:8-0
Urgency: No State Mandated Local Program:
No Reimbursable: No
SUMMARY
This bill requires the Department of Recycling and Resource
Recovery (Calrecycle) to dedicate at least 16% of its annual
appropriation from the Tire Recycling Management Fund for market
development and new technology (MD/NT) activities to local
government public work projects that use waste tires and to
related outreach efforts. The bill's provisions sunset as of
June 30, 2010.
FISCAL EFFECT
This bill may result in Calrecycle redirecting an unknown
amount, potentially in the millions of dollars, to local public
works projects from other MD/NT activities eligible to receive
funding from the department's Tire Program. The actual amount
of funding that is redirected as a result of this bill in a
given fiscal year is unknown but will depend upon (1) the amount
the Tire Management Fund MD/NT appropriation included in the
budget act for a given year and (2) the non-public works Tire
Program projects that would have been funded, absent this bill.
Calrecycle indicates that its most-recent five-year tire
recycling plan calls for funding MD/NT activities in amounts
that vary from $21.4 million to $12.5 million per fiscal year.
Assuming those MD/NT funding amounts hold true, this bill would
result in funding for local public works project that varies
from $3.4 million to $2 million per fiscal year.
COMMENTS
1)Rationale . The author contends the set aside for local public
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works projects that use waste tires, which had been authorized
by statute that has since expired, needs to be continued.
Public works projects, specifically roadway projects, the
author notes, divert waste tires from landfill. And, the
author claims, roadways made with waste tire products are
superior to other road surface materials in several ways and,
therefore, are the more cost-effective option for local
governments.
The author contends, however, that local governments, most of
who are financially strapped, frequently base their capital
decisions on up-front expense, not long-term
cost-effectiveness. The author argues for continuing
guaranteed funding for such local public works projects so
their superiority may be demonstrated to local governments and
others who will be making decisions about capital projects in
what, hopefully, will be times of greater fiscal health.
2)Background. Each year, California produces approximately 40
million waste tires. In the recent past, illegal tire piles
have produced significant hazards to human and environmental
health, including chronic fires and breeding ground for pests.
Consistent with statute, Calrecycle Tire Program grants are
designed to encourage activities that reduce the number of
waste tires going to landfills for disposal and eliminating
the stockpiling of waste tires. Activities that receive
funding include tire pile cleanup and enforcement, market
development, and demonstration projects. Revenue for the
grants is generated from a fee on each new tire sold in
California.
Until last July, the department's funding activities included
the RAC (rubberized asphalt concrete) grant program.
Established by SB 1346 (Chapter 671, Statutes of 2002, Kuehl),
the RAC grant program provided funding to local governments
to promote markets for recycled-content surfacing products
derived from waste tires generated in California. The program
was extended by SB 369 (Chapter 300, Statutes of 2006,
Simitian) and expired on June 30, 2010.
3)The Power of Momentum. This bill was amended in policy
committee to specify that 16% of Tire Program MD/NT activity
funding will go to local public works projects and related
outreach. That percentage was chosen because, as the policy
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committee analysis notes, the now-expired statute that
governed Tire Program grants similarly required 16% go toward
such public works projects.
According to the admittedly fuzzy memory of staff working at
the Integrated Waste Management Board--Calrecycle's
predecessor--when the RAC grant program was instituted, the
16% figure was chosen based upon the workload needs of the
board at that time. The decision to include the 16% figure in
this bill, therefore, was the result of the persistence of
past practice, not analytical reasoning. It may be worthwhile
to ask Calrecycle to suggest a percentage for the public works
set aside that makes sense, given current conditions.
4)Support . This bill is supported by California Association of
Counties and the Regional Council of Rural Counties, whose
members oftentimes are the recipients of Tire Program grants,
and others who advocate against waste.
5)Opposition. The bill is opposed by the Rubber Manufacturers
Association, which argues that price supports, such as Tire
Program grants, artificially prop up uneconomic uses of
tire-derived products that will fail once the price supports
are removed.
Analysis Prepared by : Jay Dickenson / APPR. / (916) 319-2081