BILL ANALYSIS                                                                                                                                                                                                    �



                                                                  AB 2675
                                                                  Page  1

          Date of Hearing:   April 30, 2014

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                  Mike Gatto, Chair

               AB 2675 (Lowenthal) - As Introduced:  February 21, 2014 

          Policy Committee:                               
          AccountabilityVote:8-2

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:               

           SUMMARY  

          This bill requires state agencies that purchase products in 11  
          different categories as specified in the State Agency Buy  
          Recycled Campaign (SABRC) to increase the threshold of recycled  
          purchases from 50% to 75% by 2020.

           FISCAL EFFECT  

          According to DGS, there are five categories-glass products,  
          lubricating oils, paper products, plastic products, and printing  
          and writing paper-that would be most impacted by this bill  
          because they currently meet or are close to meeting the 50%  
          recycled purchase requirement, but have not yet met the 75%  
          requirement proposed by this bill.

          In 2011-12, state agencies spent $73.9 million on these  
          categories, including $42 million on recycled products compliant  
          with SABRC. Assuming the same purchase volume in 2020, 75% of  
          the total amount would be $55.4 million, or $13.4 million more  
          in spending on recycled products.  To the extent the recycled  
          products are, on average, more costly, the state will spend more  
          to meet the higher threshold. An average 5% higher product cost  
          would yield about $670,000 among the General Fund and numerous  
          special funds.

          Of the remaining six categories, state agencies as a whole  
          already exceed 75% in three categories: compost (98%), metal  
          products (86%), and tire-derived products (78%). In the  
          remaining three categories with a low proportion of recycled  
          purchases-antifreeze (7%), paint (12%), and tires (12%)-it is  
          assumed that the higher threshold will not impact purchasing  








                                                                  AB 2675
                                                                  Page  2

          behavior.

           COMMENTS  

           1)Background  . AB 4 (Eastin)/Statutes of 1989, established SABRC,  
            which requires agencies to buy recycled items for at least 50%  
            of their purchases in the following product categories.

             a)   Paper products. 
             b)   Printing and writing papers. 
             c)   Mulch, compost, co-compost. 
             d)   Glass products. 
             e)   Lubricating oils.
             f)   Plastic products.
             g)   Paint. 
             h)   Antifreeze. 
             i)   Tires.
             j)   Tire-derived products. 
             aa)  Metal products.

            Agencies are required to purchase recycled products whenever  
            available, if fitness and quality are equal and the products  
            cost the same or less than non-recycled products. If fitness  
            and quality are equal and the products cost more, agencies may  
            still purchase the recycled products. Agencies annually report  
            information about their purchases in these categories to the  
            California Department of Resources Recycling and Recovery  
            (CalRecycle), which compiles this information and reports on  
            SABRC compliance by product category and department. 

           2)Purpose  . This bill increases the requirements for recycled  
            purchases to 75% by January 1, 2020.  According to the author,  
            this aligns with the statewide goal set by AB 341  
            (Chesbro)/Statutes of 2011, to divert at least 75% of solid  
            waste by 2020 through reduction, recycling, and composting.
           
          Analysis Prepared by  :    Chuck Nicol / APPR. / (916) 319-2081