BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 1933|
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THIRD READING
Bill No: AB 1933
Author: Gordon (D)
Amended: As introduced
Vote: 21
SENATE ENVIRONMENTAL QUALITY COMMITTEE : 6-0, 5/14/12
AYES: Simitian, Blakeslee, Hancock, Kehoe, Lowenthal,
Pavley
NO VOTE RECORDED: Strickland
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 74-0, 4/26/12 (Consent) - See last page
for vote
SUBJECT : Beverage containers
SOURCE : Californians Against Waste
DIGEST : This bill increases the stringency of
requirements for the importation of beverage container
material. Specifically, this bill (1) decreases, from 100
pounds to 25 pounds of aluminum, bimetal or plastic, or
from 1000 pounds to 250 pounds of glass beverage container
material, the weight above which a person importing
beverage container material into the state must report the
importation to Department of Resources Recycling and
Recovery (CalRecycle), and (2) specifies that such person
must provide to CalRecycle documentation on the source of
the material and an opportunity for inspection.
CONTINUED
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ANALYSIS : The existing California Beverage Container
Recycling and Litter Reduction Act (Act) requires a
distributor of specified beverage containers to pay a
redemption payment to the CalRecycle, for each beverage
container, as defined, sold or transferred, for deposit in
the California Beverage Container Recycling Fund (Fund).
Existing law requires any person importing more than a 100
pounds of aluminum, bimetal, or plastic beverage container
material, or more than 1,000 pounds of glass beverage
container material, into the state to report the material
and provide an opportunity for inspection and prohibits any
person from falsifying documents required pursuant to the
Act or the regulations adopted by the CalRecycle. A
violation of the Act is a crime.
Background on the Act . The Act is designed to provide
consumers with a financial incentive for recycling and to
make recycling convenient to consumers. The centerpiece of
the Act is the California Redemption Value (CRV).
Consumers pay a deposit, the CRV, on each beverage
container they purchase. Retailers collect the CRV from
consumers when they buy beverages. The dealer retains a
small percentage of the deposit for administration and
remits the remainder to the distributor, who also retains a
small portion for administration before remitting the
balance to CalRecycle. When consumers return their empty
beverage containers to a recycler (or donate them to a
curbside or other program), the deposit is paid back as a
refund.
Container fraud . The extent of illegal redemption of
out-of-state containers is unknown. However, in 2010, 31
people were arrested in an enforcement action involving the
Department of Justice and CalRecycle. Three separate fraud
rings coordinated the importation of millions of cans and
bottles from Arizona and Nevada for redemption of the CRV.
According to the Attorney General, the rings stole more
than $3.5 million. Neither Arizona nor Nevada has beverage
container redemption programs.
In the summer of 2011, CalRecycle, in coordination with the
Department of Food and Agriculture (DFA), initiated a
"no-cost" pilot program to survey and document vehicles
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importing out-of-state beverage container material into
California through all 16 DFA Border Protection Stations.
During the first 60 calendar days of the pilot program, the
information gathered indicated that over 2,500 vehicles
(including 378 rental trucks filled to capacity) imported
out-of-state beverage container material through these
stations. Based on the survey data referenced above,
CalRecycle states that a conservative estimate of fraud
exposure to the Fund is $7 million annually. This bill
reduces the redemption value of beverage container material
that could be imported into California without notifying
CalRecycle from a maximum of approximately $150 to a
maximum of less than $50.
Comments
According to the author, "California's bottle and can
recycling law has been found to be the most cost effective
program of its kind in the country, and no recycling policy
or program in the state is achieving better results.
However, the very incentives that have spurred high rates
of recycling have also inspired entrepreneurial
criminals?�AB 1933] will help create deterrents on
importers trying to illegally redeem out of state beverage
containers in California by creating a paper trail and
requiring documentation of the source and destination of
the material."
Support concerns . According to the California Grocers
Association, this bill will reduce fraud which will
increase stability in the Fund, helping recyclers stay in
business.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
According to the Assembly Appropriations Committee, there
will be negligible direct fiscal effect upon CalRecycle.
This bill will likely result in greater reporting of
importation of beverage container material to CalRecycle.
It is, therefore, reasonable to assume the bill will
increase CalRecycle's inspection workload. CalRecycle,
however, does not anticipate an increase in workload
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resulting from this bill because it currently lacks
staffing at or near border checkpoints at which the
inspections would occur. In addition, CalRecycle reports
it lacks the regulatory authority to enforce the reporting
standards required by this bill.
CalRecycle is in the initial phases of developing
regulations that, if adopted by CalRecycle, would provide
it the authority to enforce the reporting requirements. In
addition, CalRecycle has submitted a budget change proposal
that would authorize an interagency agreement with the DFA
to require DFA to conduct border inspections of beverage
container imports. CalRecycle would use the data gathered
from the DFA inspections to build a case for prosecution of
fraudulent activity by the Attorney General.
SUPPORT : (Verified 8/14/12)
Californians Against Waste (source)
California Grocers Association
ASSEMBLY FLOOR : 74-0, 4/26/12
AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Beall,
Bill Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Charles Calderon, Campos,
Carter, Chesbro, Conway, Cook, Davis, Dickinson,
Donnelly, Eng, Feuer, Fletcher, Fong, Fuentes, Beth
Gaines, Galgiani, Garrick, Gatto, Gordon, Gorell, Grove,
Hagman, Hall, Hayashi, Roger Hern�ndez, Hill, Huber,
Hueso, Huffman, Jeffries, 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,
Solorio, Swanson, Torres, Valadao, Wagner, Wieckowski,
Williams, Yamada, John A. P�rez
NO VOTE RECORDED: Cedillo, Furutani, Halderman, Harkey,
Jones, Smyth
DLW:k 8/14/12 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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