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HomeMy WebLinkAbout06/06/1990, C-18 - RESOLUTION OPPOSING ASSEMBLY BILL 4298 IIIIIII MY f pO ME ING TE `.,I c� o san suis OBISPO COUNCIL AGENOA REPORT rr NU BER FROM: John Dunn, City Administrative Officer Prepared By: Deb Hossli, Administrative Analyst SUBJECT: Resolution Opposing Assembly Bill 4298 CAO RECOMMENDATION: Adopt a resolution opposing Assembly Bill 4298, which proposes to relieve beverage container manufacturers from paying the processing fee provision of the state's beverage container recycling and litter reduction act. DISCUSSION: During the May 15, 1990 Council meeting, staff was directed to prepare a resolution for the City Council's consideration opposing Assembly Bill 4298. As proposed, the bill relieves beverage container manufacturers from paying the processing fee provision of the state's beverage container recycling and litter reduction act. Current legislation allows the Department of Conservation to impose a processing fee on beverage containers to offset any shortfalls between the scrap value of recycled containers and the actual costs of recycling containers. If beverage manufacturers are no longer required to pay this difference, the costs of recycling "expensive to process' materials such as glass and plastic will have to be taken on by the recyclers and local governments or the products will no longer be recycled. In addition to the financial implications, opponents of the legislation contend that Assembly Bill 4298 will inhibit local governments ability to comply with Assembly Bill 939, the California Integrated Waste Management Act of 1989. Assembly Bill 939 overhauls solid waste planning efforts in California and requires local governments to, among other things, reduce their waste streams 25% by 1995. Any legislation adopted by the state that discourages recycling, makes the City's task of complying with Assembly 939 more difficult. Both the California League of Cities and County Supervisors Association of California oppose this legislation. Staff has reviewed the legislation and recommends that the City Council approve the resolution formally opposing it. ATTACHMENTS: "1" - Resolution "2" - Back-up Information Text of AB 4298 is available in the Council office. \ab4298 �-18-1 RESOLUTION NO. (1990 SERIES) RESOLUTION OPPOSING ASSEMBLY BILL 4298 WHEREAS, the City of San Luis Obispo is committed to implementing recycling and waste reduction plans and programs in order to meet the requirements of the California Integrated Solid Waste Management and Recycling Act (AB 939, 1989) ; and WHEREAS, Assembly Bill 4298 by Assembly Speaker Willie Brown would, if adopted, dismantle , the processing fee provision of the state's beverage container recycling and litter reduction act as agreed to by industry, environmentalists, recyclers and local government officials in 1986; and WHEREAS, the processing fee requires beverage container manufacturers to pay the cost of recycling their containers when the scrap value is not sufficient; and WHEREAS, the net cost of recycling glass and plastic beverage containers in California in 1989 was in excess of $10 million, and in 1990 is projected to be $15 million. The deletion of the processing fee as proposed in AB 4298 will require recyclers and local government to cover that cost and in effect subsidize the recycling of glass and plastic beverage containers. NOW, THEREFORE, .BE IT RESOLVED, the City of San Luis Obispo 1. Opposes Assembly Bill 4298 currently moving through the state legislature. 2. Conveys our opposition to AB 4298 to Assembly Speaker Willie Brown, our assembly and senate representative, and the California League of Cities and County Supervisors Association- of California. RESOLUTION NO. (1990 SERIES) PAGE TWO 3. Directs our legislative representative to join with representatives of the League of cities, Sierra Club California, the Planning and Conservation League, the California Resource Recovery Association, the Northern California Recyclers Association and Californians Against Waste in working to defeat AB 4298. Upon motion of , seconded by and on the following roll call vote: AYES: NOES: ABSENT: the foregoing resolution was adopted this day of 1990. ATTEST: Mayor Ron Dunin Pam Voges, City Clerk APPROVED: City Administrative Officer t to ey M�420 AM CAW C"' 3 Californians Against Waste Towards`a Recycling Economyena - •/` May 2, 1990 ' x- `" rE I V E D Mayor Ron Dunin City of San Luis Obispo MAY 4 i4p P.O. , Box 1100 crrycSan Luis Obispo CA, 93401 LO'S01 SP SAN tl3�S 0&590.CA RE: AB 4298 Glass Industry Legislation to Gut Recycling Law - OPPOSE - Dear Mayor Dunin: We need your assistance in opposing Assembly Bill 4298, a special interest bill introduced on behalf of the glass industry by Assembly Speaker Willie Brown. If this measure is adopted, it would delete from the state's bottle and can recycling law the financial responsibility of manufacturers of glass and plastic beverage containers to pay for the cost of recycling their products. This provision, known as the processing fee, was an essential element of the original AB 2020 compromise, agreed upon by industry and environmentalists and adopted by the legislature in 1986. Under the ,processing fee, beverage container manufacturers are required to pay-- or internalize--the net cost of recycling their containers, when the scrap value alone is not sufficient to do so. By abdicating this responsibility, as proposed in AB 4298, the cost of recycling "expensive to process" glass and plastic will have to be .picked up by recyclers and/or local governments, or these materials simply will no longer be recycled. Last year's AB 939 (Sher) requires every city in the state to recycle 25 percent of their waste by 1995. The processing fee element of AB 2020 is one of the only financial mechanisms available to local government and recyclers in order to make recycling work. We urge you to act quickly, and join with recyclers, the Sierra Club, League of Cities, and others in opposing this measure. A copy of your letter or resolution opposing AB 4298 should be sent to Assembly Speaker Willie Brown, your assembly and senate representative(s), the League of Cities, and CAW. Attached is a model resolution, a copy of the bill, and some background material to assist you. Thank you for your attention to this critical recycling issue. If you have any gyest-aons, please contact us. —`,Sincerely, - Mark Murray i8 tit B 5298 Date of Hearing: April 23, 1990 Fiscal: Yes Urgency: Two _:SSEMBLY COMMITTEE ON NATURAL RESOURCES Byron D. Sher, Chair AB 4298 (Y. Brown) - As Amended: April 19, 1990 SUBJECT: BEVERAGi: CONTAINER RECYCLING: 1) SHO;iLD THE PROCESSING FEE PAID BY BEVERAGE CONTAINER MJiN;JFACTURERS TO COVER THE COSTS OF RECYCLING THEIR COK'.AINERS BE RECAST TO REDUCE THE AMOUNT PAID BY MAN!FACTURERS? 2) SHO_'LD CONVENIENCE INCENTIVE PAYMENTS TO CERTIFIED RECYCL;mS BE FLTMINATED AND REPLACED BY RECYCLING SERVICE FEES BE P;ID TO •:.'4E ELIGIBLE CERTIFIED RECYCLING CENTER IN EACH CON. =.NIENCE ZONE? 3) SHOiJ.D THE DEPARTMENT OF CONSERVATION BE LIMITED TO, EST=BLISHING AN UNSPECIFIED PERCENTAGE OF CONVENIENCE ZONES IN 1990 AND INCREASING THAT AMOUNT BY AN UNSPECIFIED PER.ENTAGE IN THE FUTURE? DIGEST Appropriation. 2/3 vote required. Current law under th•_ Beverage Container Recycling And Litter Reduction Act (the "Act") : 1) Requires beveraga container manufacturers to 'internalize• (or pay for) the costs of collecting, processing and recycling the beverage contain-ers they manufacture. To the extent these costs are not covered by scrap values paid by c•:ntainer manufacturers, current law authorizes the Department of Co.;servation (DOC,), to impose a "processing fee" on particular container types (i.e. aluminum, glass and plastic) sold in ,he state, based upon a formula specified in statute. to make up the difference betwe-n the scrap value paid by beverage 'manufacturers and the costs of recycli::g the particular container type they manufacture. 2) Requires DOC to - -;tablish "convenience zones" within 1/2 mile of most supermarkets, wi:5in which at least one certified recycling center shall be located to re ''eem beverage containers from consumers. Current law lues not specify a n_ • ricai or percentage cap on the number of convenience zones which may '. e established in the state. r continued. - AB =298 Pa-e 1 C�-4r AB 4298 5) Recasts the Beverage Container Recycling Fund to require DOC to pay - recycling service fees to certified recycling centers before payment of DOC administrative program costs, of grants to community conservation corps and other nonprofit agencies and of advertising and promotional contracts with certified recycling centers in convenience zones. 6) Makes technical conforming changes to penalty provisions of the Act. COMMENTS 1) Background. According to the sponsor, the California Glass Recycling Corporation, this measure was introuced (1) to avoid the imposition onerous processing fees: (as calculated under current lav) on glass containers sold in California (2) t- ensure that little, if any, recycled glass will be landfilled and (3) to provide a stable source of revenue for certified recyclers located in convenience zones. GPI states that current state lav does not recognize that f.:vorable economic conditions must exist to ensure that materials collected :,nd processed will be reused. The sponsor points out that the widely-reported recent. landfilling of several thousand tons of glass proves that end markets do not exist for lover grades of glass and that the economics of glass markets have been detrimentally altered due to the processing fee provisions of the Act. This measure is intended to reduce the burden of processing fees on the glass industry while simultaneously providing a stable source of revenue for recyclers to be reimbursed for their handling and collection costs. 2) Issues Addressed In Bill Were Subject of Committee Oversight Hearing In March. In response to concerns over the landfilling of glass collected under the state's beverage container recycling program. in March of this year, this committee conducted and cversight hearing on problems with glass recycling (see attached briefing paper). At that hearing, DOC announced that it would impose the processing fee effective May 1, and that it would seek legislation to allow for a reduction or rebate of processing fees for California glass manufacturers which recycle California cullet. The rebate prop:,sal suggested by DOC has been amended into AB 1490 (Sher) , which is prese:;tly pending before the Senate Natural Resources Committee. 3) Litigation Pending 'Over Proposed Imf,astion Of Processing Fee.. In March of this year, in response to the pr. blems associated. with glass being disposed of in landfills, DOC annou:;.:ed its intention to impose. a processing fee on glass beverage containers sold in the state, effective May 1, 1990. Last week, in response to this action, the California Glass Recycling Corporation filed suit in the Superior Court of Sacramento seeking immediate relief from imposition of the processing fee. A hearing date has been scheduled for April 24. 4) Recycling Service Fee Vould Permane:rtly Establish Subsidies To Recvcln Centers. As presently drafted. thi_ measure would replace current subsidies to certified recyclers (C7P's) with recycling service fees. Under current lay. CIP' s are schedu.ed to sunset in 1993. On and after October l of this year, DOC is req,:.: ed to make a number of changes to the method by which CIP's are distribut:-d to 'certifie�J recyclers to encourage greater efficiency at these centers and greater volumes 3f materials collected. This measure would repeal these provisions and instead provide recycling services fees to all cert:.`ied in-zone recyclers, regardless of their efficiencies. and make .perman,-nt t:rese subsidies. ����� 88 The Sacramento Bee Final • Friday,April 27,1990 The Sacramento Bee locally owned and edited for 133 years JAMES McCLATCHY,editor. 1857-7883 C.K.McCLATCHY,editor,president.7883.7936 ELEANOR McCLATCHY,president,1936-79718 WALTER P.JONES.editor, 7936.7974 C.K.McCLATCHY,editor. 7974-1989 GREGORY_.FAVRE,e=ecutivs editor PETER SCHRAG,editorial page editor FRANK R.J.WHrrAKER,president and general manager t Wiwe Brown's broken bottle bill he day after Earth Day, a key Assembly worked out by manufacturers, the grocery committee approved legislation that industry and environmentalists to avoid an- threatens to gut the state's bottle bill and se- other expensive initiative fight. Because riously undermine California's recycling ef- there is no fee on materials that are easily re- forts. The bill, AB 4298, sponsored by the cyclable, such as aluminum, and a high fee glass manufacturing industry and authored on plastics and glass,which are hard to recy- by Assembly Speaker Willie Brown, would cle,the current system encourages the use of ..keep the state from imposing a processing recyclable containers. Once the processing fee on manufacturers that would cover the fee is lowered to the point that it becomes full cost of recycling beverage containers Aegligible, which is what the Brown bill and the other waste their products generate. would do,manufacturers would have no rea- The Brown bill recalculates the fee set by son to do the environmentally right thing. In the Department of Conservation in a way addition, curbside recycling programs, that substantially understates the cost of re- which benefit from the increased scrap value cycling. That saves manufacturers money that the processing fees encouraged, are un- but it deprives recyclers of the funds they dercut by the Brown bill. need to make recycling economically viable. ! In order to keep the recycling system from -collapsing, Brown proposes to raid the fund he state's 4-year-old bottle bill has established to pay consumers 21/2 cents re- helped substantially to reduce litter in demption value for every container they re- parks, beaches and roadsides. Despite occa- turn to recycling centers.The Department of sional g:itches, most of that litter has been Conservation, which administers the state's kept .tui of landfills. With the Brown bill, bottle bill, testified in committee Monday gla manufacturers are seeking to renege that that provision of the Brown bill couli on commitments they made five years ago to bankrupt the state's recycling fund. pay their fair share of the cost of recycling The processing fee was a key elemen7 of in they produce. AB 4298 deserves to California's original bottle bill, which was be soundly rejected.