Bills Targeting Packaging Ignore Costs, Lack of Recycling Infrastructure

Identical job killer bills that will substantially disrupt the state’s economy by placing an overly broad, unrealistic source reduction, recyclability and compostable mandate on virtually all manufacturers of single-use packaging used in California are moving in the Legislature.

The California Chamber of Commerce is opposing AB 1080 (Gonzalez; D-San Diego) and SB 54 (Allen; D-Santa Monica), which propose unprecedented product regulation in California.

As amended on June 20 (AB 1080) and June 24 (SB 54) the bills will substantially increase the cost to manufacture and ship consumer products sold in California.

Both bills give the California Department of Resources Recycling and Recovery (CalRecycle) broad authority to develop and impose costly and unrealistic new mandates on manufacturers of all single-use packaging and certain single-use plastic consumer products. The compliance time frame is unrealistic and fails to address the state’s lack of recycling and composting infrastructure.

The CalChamber shares the goal of reducing the amount of packaging and plastics ending up in landfills or worse, the natural environment. The laudable goal of AB 1080 and SB 54, however, is undermined by their rush to a “solution” that will have significant negative environmental and economic consequences for California businesses, employees and consumers.

Problems

  • Thorough analysis needed first. Before the Legislature fundamentally changes how the majority of products are packaged and sold into California, the fifth largest economy in the world, there should be a thorough assessment of California’s waste collection, recycling and composting infrastructure. The analysis should include examining the types of single-use packaging currently being collected, processed, recycled or composted. Such an assessment is needed to ensure that the implementing regulations to follow will achieve the goals of the bills without substantial economic repercussions. If the larger goal is to develop a working model for other states to embrace, California’s program must achieve its goals while maintaining a healthy economy.
  • California lacks adequate recycling and composting infrastructure for manufacturers to meet their compliance obligations.California’s decades-long reliance on foreign markets has left the state devoid of the necessary equipment, systems and other technologies to enable California to capture and recycle its own recyclable materials. Nearly 1,000 recycling centers across the country have closed since China instituted its “National Sword” policy in 2018, restricting foreign imports of recyclable materials, thereby collapsing the market for recyclable materials As a result, more recyclable products/packaging is ending up in landfills due to a lack of collection and processing capabilities.
  • AB 1080 and SB 54 contain no enforcement mechanism of the required 75% recycling rates.Companies would have to track individual products through the entire waste stream to demonstrate they are recycled at a 75% rate over a three-year rolling period. No provision is made for how companies would comply.Tracking individual products from cradle to grave would be a logistical nightmare—if not impossible—and would substantially increase the costs of goods.
  • The bills ignore a critical participant in California’s pollution problem—the consumer. Whether a product is recyclable or compostable has little bearing on whether a consumer disposes of the product properly—a problem on which the bills are silent.Manufacturers cannot force consumers to recycle goods, yet AB 1080 and SB 54 will increase costs on manufacturers and punish them for consumer behavior over which the manufacturers have no control.Consumer education should be a critical component of any recycling program.
  • Increased costs for food and consumer products.
    AB 1080 and SB 54 provide CalRecycle with substantial authority to develop “economic mechanisms to reduce the distribution of single-use packaging and products.” The undefined phrase could be interpreted by CalRecycle as new authority to tax manufacturers.California consumers will bear the burden of these new taxes by paying more for goods even though these items may end up in landfills anyway because California does not have the facilities needed to collect and process recyclable goods.
  • Could conflict with existing regulatory programs.
    The bills’ broad and ambiguous mandates also may conflict with other existing regulatory regimes in the same product space, including the 1986 “bottle bill” setting up the program to encourage consumers to recycle beverage containers and the 1991 Rigid Plastic Packaging Container (RPPC) law.Businesses may already have spent billions of dollars to comply with these recycling and reduction laws.

What’s Next

AB 1080 is scheduled to be considered on July 3 by the Senate Environmental Quality Committee. Send a letter.

SB 54 is scheduled for a July 8 hearing in the Assembly Natural Resources Committee. Send a letter.

The CalChamber continues to urge legislators to allow for full consideration of the entire life cycle of materials, end-use markets, unintended consequences, regrettable substitutes, related infrastructure and disruptions to existing food distribution systems before rushing to adopt a bad public policy that will hurt the environment and the economy, and increase costs for Californians.

Staff Contact: Adam Regele

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