BILL ANALYSIS �
-----------------------------------------------------------------
|SENATE RULES COMMITTEE | AB 2467|
|Office of Senate Floor Analyses | |
|1020 N Street, Suite 524 | |
|(916) 651-1520 Fax: (916) | |
|327-4478 | |
-----------------------------------------------------------------
THIRD READING
Bill No: AB 2467
Author: Nestande (R)
Amended: 5/5/14 in Assembly
Vote: 21
SENATE ENVIRONMENTAL QUALITY COMMITTEE : 7-0, 6/18/14
AYES: Hill, Gaines, Fuller, Hancock, Jackson, Leno, Pavley
SENATE APPROPRIATIONS COMMITTEE : 5-0, 8/14/14
AYES: De Le�n, Hill, Lara, Padilla, Steinberg
NO VOTE RECORDED: Walters, Gaines
ASSEMBLY FLOOR : 73-0, 5/8/14 - See last page for vote
SUBJECT : California Beverage Container Recycling and Litter
Reduction
SOURCE : Author
DIGEST : This bill authorizes the Department of Resources
Recycling and Recovery (CalRecycle) to pay a market development
payment to both certified entities and product manufacturers for
empty plastic beverage containers.
ANALYSIS : Existing law, under the California Beverage
Container Recycling and Litter Reduction Act (Act) (commonly
referred to as the Bottle Bill), requires beverage containers
sold in this state to have a California redemption value (CRV)
of five cents for containers that hold fewer than 24 ounces and
10 cents for containers that hold 24 ounces or more and requires
CONTINUED
AB 2467
Page
2
a distributor to pay a redemption payment to CalRecycle. These
funds are continuously appropriated to CalRecycle for the
payment of refund values and processing fees. The Act also:
1.Requires CalRecycle to certify recycling centers and
processors that participate in the program.
2.Authorizes CalRecycle to award up to $10 million annually for
market development payments for empty plastic beverage
containers to certified entities or product manufacturers.
3.Defines "certified entity," for purposes of the plastic market
development payments (PMDP), as a recycling center, processor,
or dropoff or collection program certified by CalRecycle, and
defines "product manufacturer" to mean a person who
manufactures a plastic product in the state.
4.Authorizes CalRecycle to allocate an amount greater than $10
million after 2012, as prescribed.
5.Specifies that CalRecycle may set different payment amounts
for certified entities and product manufacturers, not to
exceed $150 per ton, according to the following
considerations:
A. The minimum funding level needed to encourage in-state
washing and processing of empty plastic beverage containers
collected for recycling;
B. The minimum funding level needed to encourage in-state
manufacturing that uses empty plastic beverage containers
collected for recycling; and
C. The total amount of funds projected to be available for
PMDP and the desire to maintain the minimum funding level
needed throughout the year.
1.Sunsets PMDP on January 1, 2017.
This bill authorizes CalRecycle to pay a market development
payment to both certified entities and product manufacturers for
empty plastic beverage containers.
Background
CONTINUED
AB 2467
Page
3
PMDP . The Bottle Bill is designed to provide consumers with a
financial incentive for recycling and to make recycling
convenient to consumers so that the beverage container component
of the solid waste stream will decrease. The centerpiece of the
Bottle Bill is the 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.
The PMDP was established in 2006 and extended in 2011. The 2011
extension also authorized CalRecycle to expend an amount greater
than $10 million annually if it makes specified determinations.
Existing law is explicit that CalRecycle may expend "up to" $10
million, and that PMDPs "shall not exceed" $150 per ton; both of
these provisions allow CalRecycle to expend lesser amounts.
Existing law further specifies that when determining the amount
of the PMDP for certified entities and product manufacturers, it
must consider the amount of funds projected to be available and
"the desire to maintain the minimum funding level throughout the
year."
The PMDP is designed to encourage the in-state recycling of
plastic beverage containers. While the number of certified
entities has remained fairly constant, the number of product
manufacturers has more than doubled since the beginning of the
program. In 2013, eight certified entities and 46 manufacturers
received the PMDP. Five companies are both certified entities
and product manufacturers, which enables them to receive the
PMPD for both processing and manufacturing.
Proposed regulatory changes . In spite of the broad authority
granted to CalRecycle to adjust the amount of the PMDP and
statutory guidance that CalRecycle should consider "the desire
to maintain the minimum funding level throughout the year,"
CalRecycle held a workshop in October 2013 because PMDP funding
had been depleted by the second quarter "for the past several
years." The purpose of the workshop was to discuss proposed
emergency regulatory changes to limit payments to product
CONTINUED
AB 2467
Page
4
manufacturers only and cease all payments to certified entities.
After the workshop, a number of certified entities expressed
concern to CalRecycle about the proposed changes and the use of
the emergency regulations process, which would reduce the public
comment period from 45 days to only five.
In January 2014, CalRecycle issued a notice to PMDP participants
stating that, as in previous years, the PMDP would be $150 per
ton for certified entities and product manufacturers. This
notice did not reference emergency regulations. In February,
CalRecycle issued a notice stating that it will allocate $2.5
million per quarter for PMDPs, and stated that "the Department's
plans are to enact new emergency regulations to issue PMDP
payments to manufacturers only." The notice indicated that
certified entities would stop receiving the PMDP after the first
quarter. CalRecycle has not released draft regulations or any
additional notices related to the program.
FISCAL EFFECT : Appropriation: No Fiscal Com.: No Local:
No
According to the Senate Appropriations Committee, on-going cost
pressures in the low millions of dollars on the California
Beverage Container Recycling Fund (special) for maintaining
broad eligibility for market development payments.
ASSEMBLY FLOOR : 73-0, 5/8/14
AYES: Achadjian, Alejo, Allen, Ammiano, Atkins, Bigelow, Bloom,
Bocanegra, Bonilla, Bonta, Bradford, Brown, Buchanan, Ian
Calderon, Campos, Chau, Ch�vez, Chesbro, Conway, Cooley,
Dababneh, Dahle, Daly, Dickinson, Donnelly, Fong, Fox,
Frazier, Beth Gaines, Garcia, Gatto, Gomez, Gonzalez, Gray,
Grove, Hagman, Hall, Harkey, Roger Hern�ndez, Jones,
Jones-Sawyer, Levine, Linder, Logue, Lowenthal, Maienschein,
Medina, Melendez, Mullin, Muratsuchi, Nazarian, Nestande,
Olsen, Pan, Patterson, Perea, Quirk, Quirk-Silva, Rendon,
Ridley-Thomas, Rodriguez, Salas, Skinner, Stone, Ting, Wagner,
Waldron, Weber, Wieckowski, Wilk, Williams, Yamada, John A.
P�rez
NO VOTE RECORDED: Eggman, Gordon, Gorell, Holden, Mansoor, V.
Manuel P�rez, Vacancy
CONTINUED
AB 2467
Page
5
RM:nl 8/16/14 Senate Floor Analyses
SUPPORT/OPPOSITION: NONE RECEIVED
**** END ****
CONTINUED