BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 794|
|Office of Senate Floor Analyses | |
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THIRD READING
Bill No: AB 794
Author: Wieckowski (D), et al.
Amended: 8/15/11 in Senate
Vote: 21
SENATE ENVIRONMENTAL QUALITY COMMITTEE : 6-0, 6/20/11
AYES: Simitian, Strickland, Blakeslee, Hancock, Kehoe,
Lowenthal
NO VOTE RECORDED: Pavley
SENATE APPROPRIATIONS COMMITTEE : 8-1, 8/25/11
AYES: Kehoe, Alquist, Emmerson, Lieu, Pavley, Price,
Runner, Steinberg
NOES: Walters
ASSEMBLY FLOOR : 77-0, 5/31/11 - See last page for vote
SUBJECT : Solid waste
SOURCE : Californians Against Waste
DIGEST : This bill allows the Department of Resources
Recovery and Recycling (DRRR) to impose civil penalties
against a covered electronic waste (CEW) recycler or
collector who makes a false statement or representation for
purposes of compliance with the Electronic Waste Recycling
Act (Act). Codifies regulations that describe the type of
CEW that may receive payment under the Act. Codifies
regulations authorizing the DRRR to conduct reviews and
audits related to the operations of CEW recyclers and
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collectors.
ANALYSIS :
Existing law:
1. Establishes the Act for the purpose of providing a cost
free and convenient means for consumers to return,
recycle, and ensure the safe and environmentally-sound
disposal of covered electronic devices (CEDs). A CED is
a video display device containing a screen greater than
four inches, measured diagonally. A CED that is
discarded is considered CEW.
2. Requires a consumer to pay a CEW recycling fee upon the
purchase of a new or refurbished CED. The CEW recycling
fee ranges from $6 to $10 for each CED depending on the
screen size and is used primarily to pay CEW collectors
and recyclers.
3. Provides payment to CEW collectors and recyclers for
costs associated with collecting and recycling CEW that
has been generated in the state. Regulations expressly
prohibit a CEW collector or recycler from requesting
payments for non-California CEW. CEW owned by a person
in California but used entirely outside of the state is
not eligible for payment.
4. Requires, pursuant to regulations, a CEW collector to
make reasonable efforts to determine if CEW it collects
is from California or non-California sources.
5. Requires, pursuant to regulations, a CEW recycler to
ensure that recycling payments are not claimed for
non-California source materials.
6. Requires, pursuant to regulations, the DRRR to review
payment claims made by CEW collectors and recyclers and
determine if a payment is due under the Act. CalRecycle
may deny or adjust payment for an incomplete or
deficient payment claim.
7. Allows, pursuant to regulations, DRRR to conduct an
audit of CEW collectors and recyclers to determine
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compliance with the Act. If a CEW collector or recycler
fails to provide reasonable access for audits,
CalRecycle may revoke the collectors or recyclers
approval to participate in the payment program and deny
current and future claims for payment.
This bill:
1. Authorizes civil liability in an amount of up to $25,000
per violation, which may be imposed administratively by
DRRR, against any person, including an authorized CEW
collector or recycler, who makes a false statement or
representation in any document used for purposes of
compliance with the Act. Civil liability may not be
imposed if the CEW collector or recycler made verifiable
and reasonable efforts to determine the source of the
CEW.
2. Requires that an authorized collector or covered
electronic waste recycler who makes a false statement or
representation regarding the source of covered
electronic waste is not liable for that statement or
representation if the electronic waste collector or the
recycler has made verifiable and reasonable efforts to
determine the source of the covered electronic waste,
unless DRRR determines the electronic waste collector or
recycler was negligent in ensuring the accuracy of the
source of covered electronic waste.
3. Authorizes DRRR to revoke the approval or deny the
renewal application of a CEW collector or recycler who
wishes to participate in the Act's program if he/she
makes a false statement or representation in a document
used for purposes of compliance with the Act or if
he/she has a history demonstrating a pattern of
operation in conflict with the requirements of the Act.
4. Allow DRRR to pay an electronic waste recycling or
recovery payment only for covered electronic waste for
which the authorized collector or covered e-waste
recycler demonstrates to have been generated by a person
who used the covered electronic device while located in
this state and prohibits DRRR from making those payments
for covered electronic waste generated outside of the
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state and brought into the state. The bill requires
DRRR to establish the documentation requirements
necessary for an authorized collector or covered e-waste
recycler to demonstrate that covered electronic waste
was generated in the state and eligible for payment.
5. Allows DRRR to examine a payment claim to validate
completeness, accuracy, truthfulness, and compliance
with applicable laws and regulations.
6. Allows DRRR to conduct post-payment audits of CEW
collectors and recyclers to determine whether recovery
or recycling payments are being paid by DRRR according
to the requirements of the Act. DRRR may collect and
recover any moneys improperly paid with interest.
Comments
CEW collectors under the Act provide a free and convenient
system for collecting, consolidating, and transporting CEW
generated in the state. CEW collectors then deliver the
waste to CEW recyclers who receive, process, and recycle
the CEW. The CEW collectors and recyclers submit payment
claims to CalRecycle for compensation. DRRR reviews the
claims for compliance with the Act and, if appropriate,
makes payments to the CEW collectors and recyclers.
Since January 2005, approximately 965 million pounds of
claimed CEW have been recycled and over $420 million in
payments have been made to CEW collectors and recyclers.
The Act has created jobs and fostered California's
electronic waste and recycling infrastructure with
approximately 600 approved CEW collectors and 60 approved
recyclers throughout the state. The state's CEW
infrastructure also recovers substantial quantities of
miscellaneous electronic waste not covered by the CEW
payment system.
CalRecycle has annually denied 2 percent to 12 percent of
submitted payment claims because of non-compliance or
significantly inconsistent (and possibly fraudulent)
documentation. Since 2005, approximately $20 million in
payment claims have been denied. In addition, some believe
that millions of dollars have been paid out for fraudulent
claims that were undetected by the state.
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A major issue with fraud involves electronic waste that is
brought in from out of state. The Act only allows payment
for CEW generated in California. Regulations prohibit
payment for CEW owned by a person in California but used
entirely outside of the state. However, some CEW
collectors and recyclers seek payment under the Act for out
of state electronic waste by submitting fraudulent
documents claiming that the waste was generated in
California. DRRR reviews payment claims to ensure
compliance under the Act and to prevent fraud. As part of
this review, DRRR conducts spot-checking, which involves
contacting the sources of the CEW listed on the payment
claim. Under regulations, DRRR can also conduct audits to
detect fraud.
This bill codifies DRRR's review and audit regulations.
Codifying these regulations will prevent any legal
challenge against the validity of DRRR's authority to
conduct reviews and audits to detect fraud and malfeasance.
This bill also provides DRRR with significant
administrative authority to punish and deter fraud by
allowing DRRR to impose up to $25,000 in fines per
violation against a CEW collector or recycler who makes a
false statement in a document submitted pursuant to the
Act. Additionally, this bill authorizes DRRR to exclude a
collector or recycler from the CEW program who has
committed fraud or has a history demonstrating malfeasance
under the Act.
Related Legislation
AB 549 (Carter) seeks to require, as a condition of making
e-waste recycling or recovery payments by DRRR, that the
covered electronic device for which the payment is claimed
was used in California. The bill is currently in the
Senate Environmental Quality Committee.
AB 583 (Knight) seeks to transfer the duties, powers, and
authority of the DTSC under the Electronic Waste Recycling
Act to DRRR. The bill is in the Assembly Environmental
Safety and Toxic Materials Committee.
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AB 960 (Lowenthal) seeks to revise the requirements imposed
on exportation of CEW to additionally include a person who
exports electronic waste or a previously used electronic
device and would also include, in the provision, an export
intended for reuse. The bill is on the Senate
Appropriations Committee Suspense File.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
According to the Senate Appropriations Committee, many of
the requirements in the bill have been incorporated into
the regulations governing the program. However, by
explicitly increasing the Department's authority and
responsibility to enforce these program requirements, the
bill will impose additional costs on the DRRR. The DRRR
indicates that it will need additional staff, at a cost
of approximately $750,000 per year to implement the
requirements of the bill.
SUPPORT : (Verified 8/24/11)
Californians Against Waste (source)
ARGUMENTS IN SUPPORT : According to the author's office,
this bill seeks to address the problem of fraudulent claims
for recycling or recovery payments within the electronic
waste recycling program operated by DRRR. This type of
fraud was one of the key problems identified during a joint
oversight hearing by the Assembly Natural Resources and the
Environmental Safety and Toxic Materials Committees earlier
this year. To address the problems of fraud, this bill
imposes civil liability of up to $25,000 per violation upon
a person who makes a false statement or representation on
any document used for purposes of compliance with the
Electronic Waste Recycling Act. This bill also seeks to
codify numerous regulations authorizing DRRR to conduct
reviews of recycling payment claims and to audit the
operations of recyclers and collectors.
ASSEMBLY FLOOR : 77-0, 5/31/11
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AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall,
Bill Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Campos, Carter, Cedillo,
Chesbro, Conway, Cook, Davis, Dickinson, Eng, Feuer,
Fletcher, Fong, Fuentes, Furutani, Beth Gaines, Galgiani,
Garrick, Gatto, Gordon, Grove, Hagman, Halderman, Hall,
Harkey, Hayashi, Roger Hern�ndez, Hill, Huber, Hueso,
Huffman, Jeffries, Jones, Knight, Lara, Logue, Bonnie
Lowenthal, Ma, Mansoor, Mendoza, Miller, Mitchell,
Monning, Morrell, Nestande, Nielsen, Norby, Olsen, Pan,
Perea, V. Manuel P�rez, Portantino, Silva, Skinner,
Smyth, Solorio, Swanson, Torres, Valadao, Wagner,
Wieckowski, Williams, Yamada, John A. P�rez
NO VOTE RECORDED: Charles Calderon, Donnelly, Gorell
DLW:mw 8/26/11 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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