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II - AB 341 Protecting our community's health and the environment by providing solid waste and sewer collection services. www.cmsdca.gov C OSTA M ESA S ANITARY D ISTRICT . . . an Independent Special District Memorandum T o: The Board of Directors From: Scott Carroll, General Manager Date: September 11 , 2012 Subject: AB 341 Summary On October 5, 2011, Governo r Brown signed into law AB 341. AB 341 will set a policy goal of the state that not less than 75% of solid waste generated by source reduced, recycled, or composted by the year 2020. It also requires CalRecycle, the state agency responsible for enforcing state mandates on solid waste, to provide a report to the Legislature that provides strategies to achieving the policy goal. The report is due on January 1, 2014. One of the primary purposes of AB 341 is the creation of green jobs. The landmark law of AB 939 in 1989 has created 125,000 jobs over the past two decades. The industry generates $4 billion a year in salaries and produces $10 billion worth of goods and services annually. “Recycling is a powerful fuel that helps propel California's economic engin e," AB 341 author Assemblymember Chesbro (D -North Coast) said. “AB 341 will not only create more green jobs, but will protect the environment and conserve energy by reducing the amount of waste that ends up in landfills ”, according to Assemblymember Ches bro . CalRecycle has developed its draft plan to comply with AB 341, but they are proposing a p aradigm shift by changing its focus from diversion to recycling . Staff has finished reviewing the draft plan and has provided an overview below along with staff ’s proposed positions in support or opposition to certain aspects of said plan. Staff Recommendation That the Board of D irectors directs staff to send comments on CalRecycles’s draft plan. Board of Directors September 11 , 2012 Page 2 of 8 Analysis In 2007, SB 1016 was signed into law that changed the way the state and local agencies report solid waste generation. Instead of reporting a diversion rate (e.g. 50%) agencies must now report a per capita disposal rate. SB 1016 also changed the base tonnage generation to 2003 -2006. The State’s base genera tion from 2003 -2006 is 12.6 pounds per resident per day , so under AB 341 the goal for the State is to achieve 3.15 pounds per resident per day . However, CalRecycle believes 2003 -2006 base tonnage is too high because during those years was strong economic growth that resulted in historical disposal generation. Therefore, CalRecycle is recommending the average tonnage of 1990 -2010, which will change the base generation significantly to 10.7 pounds per resident per day, which means the new goal to achieve fr om AB 341is 2.7 pounds per resident per day. As mentioned earlier, CalRecycle is proposing a paradigm shift by changing its focus from source reduction diversion to recycling. Under the current source reduction goal, the state achieved a 65% diversion ra te in 2010. To reach a 75% diversion goal, CalRecycle will have to reduce the statewide disposal by 9 million tons. However, if you take out the recycling credits (e.g. alternative daily cover) then CalRecycle is achieving a 49% recycling rate. To reach a 75% recycling goal, Calrecycle will have to reduce the statewide disposal by 19 million tons, a significant difference. CalRecycle is determining the potential growth in traditional disposal and disposal related activities and amount of additional recy cling needed. Their proposal projection in 2020 is as follows: • 36 million tons plus 7 million tons of previous excluded waste = 43 million tons of potential disposal related activity if no additional steps are taken to increase recycling. CalRecycle wants to expand or site more facilities to accommodate higher recycling volume, which will create more recycling based jobs in Calif ornia . CalRecycle a lso wants to require stronger markets for recycled materials within our state and successful implementat ion of other policies and greater participation in recycling behaviors by the public. If successful, CalRecycle believes 200 million tons of statewide land fill capacity will be preserved from 2014 -2025 CalRecycle is proposing the following Social, Econom ic and Environmental Drivers for developing a Plan: 1. Preserve natural resources 2. Maximize source reduction 3. Decrease reliance on landfills 4. Minimize the impact of problematic waste materials 5. Increase protection of public health and the environment Board of Directors September 11 , 2012 Page 3 of 8 6. Reduce GHG e missions, and reduce localized air pollution 7. Reduce dependence on oil by increasing in -state production of bioenergy/biofuel 8. Reduce the overall energy demand 9. Increase economic opportunity, manufacturing, and jobs in California 10. Reduce costs to local governm ents 11. Preserve local control 12. Provide stable state funding as necessary to implement and maintain a sustainable materials management program. Based on these drivers, CalRecycle wants to focus on ten areas that they believe are critical to achieving the 75 r ecycling goal. 1. Increase Recycling Infrastructure 2. Organics 3. Increase Commercial Recycling 4. Establish Extended Producer Responsibility 5. Reform Beverage Container Program 6. Increase Procurement/Demand 7. Other Materials 8. Governance/Funding 9. Source Reduction 10. The Other 25% CalRecycle has identified several implementation concepts for each of the 10 areas mentioned above. Not all of the concepts are described below, but you can view the concepts and the Plan in it ’s entirely by downloading the document at http://www.calrecycle.ca.gov/75percent/Plan.pdf . 1. Increase Recycling Infrastructure New recycling manufacturing/processing infrastructure - Estimate that a dozen and perhaps over 100 new or expanded faciliti es are needed. Potential funding sources include landfill tipping fee increase. 75% goal likely cannot be reached unless instate manufacturing and energy generation facilities are developed. Regulatory Oversight – Increase oversight and inspections on ex isting and future facilities to ensure they operate in a manner that continues to be protective of public health, safety, and the environment and they continue to be good neighbors and part of a sustainable infrastructure – Indirect contribution to 75% goa l Modify RMDZ Program to be Statewide – Two options: 1) keep current zones as is, but allow for loans to be available to recycling manufacturers statewide where partnerships exist with local governments. 2) Change to a statewide RMD loan and assistance pr ogram. No specified zone areas. CalRecycle will focus on technical and financial assistance to any recycling manufacturer Board of Directors September 11 , 2012 Page 4 of 8 CMSD proposed position – Supports new and expanded facilities but funding for these facilities should be done on tax breaks and/or incentives for the private industry. CMSD opposes increasing tipping fees because the fees will be passed onto CMSD residents. Oppose CalRecycle increasing oversight and inspections because that would mean the hiring of additional staff, which would put a burden on the state budget. Additional inspections should be conducted on a county level with the option of using private inspectors. Support option 2 for modifying RMDZ program statewide. However, additional funding for loans may be required. CalRe cycle does not identify the funding source. 2. Organics Repeal Alternative Daily Cover (ADC ) and other waste materials beneficially used at Landfills as diversion – Alternative approach to require all green waste used for ADC be subject to tipping fee Phase out of landfilling organics - One approach to require organics to be source separate for collection and then prohibit the landfilling of source separated organics. Funding for Organic Infrastructure – Compostable organic materials constitute 1/3 of landf illed material. Financial incentives are needed to facilitate the development of dozens new organics management facilities in California, include anaerobic digestion facilities. Funding source – landfill tipping fee increase. Cross -Agency Regulatory Iss ues – Work with other federal and state agencies to eliminate duplication in regulations. CMSD proposed position – Oppose repealing ADC as diversion. Green waste used as alternative daily cover is an inexpensive and environmentally sound method for cover ing at the landfill. Oppose phasing out landfilling organics until more organic management facilities are developed. Do not support source separating organics because in CMSD that would require additional trucks, which increases operations expenditures. Support funding for organic infrastructure, but not through increased tipping fees. Give the private industry tax breaks and/or incentives for developing new infrastructure. Support streamlining regulations. 3. Increase Commercial Recycling Reduce Thresho lds for Commercial Recycling – 2 variations – 1) Lower the threshold from 4 cubic yards/week to 2 cubic yards per week and include all multifamily complexes. 2) Keep the current threshold but require regulated businesses to recycle greater than 50% and do cument tonnage recycled. Increase Requirement for MRF Performance – There may be great potential for more recovery at mixed waste MRF’s and lower end clean MRFs. MRF performance standards could be based on recovery rate, amount of recyclables in residual s, implementation of BMP. Board of Directors September 11 , 2012 Page 5 of 8 Establish Business Enforcement Component – Either done by local jurisdiction or by CalRecycle that focuses on businesses and multifamily complexes that do not comply with commercial recycling requirement. Grants for Multi -Family Recycling Programs – Support and/or augment current commercial recycling requirements by providing grants to jurisdictions, waste haulers, non -profit organizations, colleges, and regional partnerships for multi -family complex recycling programs. CMSD pro posed position – S upports the second variation for reducing threshold for commercial recycling but CalRecycle needs to define multifamily complexes. What about complexes that have 4 or less units? Can they use automated cart services? Supports the use o f dirty MRFs for more recovery at mixed waste facilities . Dirty MRFs cut down on the number of trucks in the street and have proven tec hnology of the benefits. Oppose establishing businesses enforcement component. CMSD believes that businesses need less government bureaucracy to be successful and fears that an enforcement component will lead to businesses leaving the state along with their valuable tax revenues. Support grants for multi -family recycling, but recommends funds to be used to deter scavengi ng to purchase lockable containers, enforcement and public education. 4. Establish Extended Producer Responsibility Authority to decide products and targets – Establish a process for CalRecycle to select products requiring management under an Extended Produc er Responsibility (EPR) approach and to set enforceable end of life targets for those selected products. Packaging – Comprise of nearly 1/3 of U.S. municipal solid waste stream and it continues to grow in volume. According to the US EPA containers and pa ckaging generation increased by 13 million tons since 1990. A comprehensive approach has been difficult to discuss in part because packaging encompasses an enormous array of products and material types. 2 options to consider 1) select a small set of problemat ic products/materials (e.g. non CRV beverage containers) and establish a statewide pilot program that is operated for several years before requiring additional packaging EPR programs. 2) Conduct a pilot that is comprehensive in terms products/materials, but i s limited to a small geographic area (e.g. coastal areas concerned with marine litter) CMSD position - Oppose CalRecycle overseeing and enforcing manufacturers because it would require additional staffing that would be a burden on the State’s budget. The additional enforcement could also place a burden on manufacturers that may require them to relocate out of the state. CMSD does support option 1 for packaging and suggest CalRecycle focus on Styrofoam. Board of Directors September 11 , 2012 Page 6 of 8 5. Reform Beverage Container Program Program Expansi on of All Ready to Drink Beverages – Program will include all ready -to -drink beverages for human consumption, except specified drinks (e.g. milk, medical food, baby formula. By consumers returning their containers to buy -back centers instead of curbside b ins, there is less contamination and the quality and quantity of recycled material is greater. Elimination of 14581 Fixed Dollar Expenditures - Eliminate automatic continuous appropriation (e.g. $10.5 million to cities/counties for their recycling activit ies) and develop a planning process that lay out proposed programmatic priorities for surplus funds, which would be expended if available and if appropriated in those years by the Legislature . CMSD proposed position : Oppose consumers returning their all ready to drink beverage containers to buy back centers, because the revenue from these containers in curbside programs help offset the cost of providing a curbside recycling collection program. Furthermore, if CalRecycle is going to focus on increasing di rty MRFs performances, than contamination of recyclable materials should not be an issue. Oppose 14581 fixed dollar expenditures because under the proposed plan CMSD believes surplus funds will never be available and the Legislature will not appropriate fu nds for recycling activities but rather they will use the money to balance the state budget 6. Increase Procurement/Demand Increase PCRC and EPP Purchases by the State . Reform Environmentally - Preferable Purchasing (EPP) and Post Consumer Recycled Content (PC RC) law and work with California’s Department of General Services and other state purchasing entities (which may account for about 40% of state purchasing) to give higher priority to PCRC products and EEP CMSD proposed position: None 7. Other Materials Plas tics – Finding a path forward to the management of plastic in California is one of the keys to a more sustainable climate for the production and recycling of this resource. Construction and Demolition – Nearly 16% of material used as ADC is C&D. In addit ion, nearly 29% of the disposed waste stream is C&D, which includes woody debris and lumber. AQMD is reclassifying existing mobile crushers and grinders as stationary resources, funding is needed to help processors remain in compliance. Consider a grant program funded by a tipping fee on ADC or a loan program that is either an expanded RMDZ program or utilizes other funding. Fiber – Cardboard is still one of the largest components of the waste steam despite being one of the more recyclable commodities. Board of Directors September 11 , 2012 Page 7 of 8 CMSD proposed position: S upports a more sustainable climate for the production and recycling of plastics and encourage CalRecycle to collaborate with local government, non -profit entities along with the plastic industry. Oppose a tip fee on ADC to fund a program to make wood grinders be in compliance with AQMD. CMSD recommends funding from AQMD to help with compliance. S upport s a progra m that will recycle more cardboard. 8. Governance/Funding New models for funding waste/materials management – The CIWM Act of 1989 requires each operator of a disposal facility in the state to pay a quarterly fee to the State Board of Equalization. The current fee of $1.40 per ton is so low as to offer little disincentive to landfilling. CalRecycle could research and analyz e the various models employed in other states and countries for solid waste programs. CMSD proposed position: Supports CalRecycle conducting research and analyze various models employed in other states and countries, but opposes raising the tipping fee as this fee will be passed on to our customers. 9. Source Reduction Organic Food Programs, Backyard Composting, Vermicomposting – Gra nt program focused on reducing generation of food waste. Promotion of Local Zero Waste Activities – Promotion of and guidance on zero waste activities, which could include: developing new information for CalRecycle website, assessing definition of zero waste, conducting or participating in workshops on zero waste “best practices” for communities and businesses. CMSD proposed pos ition: Supports a grant program to promote reducing food waste through backyard composting and vermicomposting. In 2010, CMSD was successful in procuring a grant from OC Waste & Recycling where composting machines and vermicomposting are offered a substant ial reduced rate. The grant also pays for community composting workshops and a vermicomposting program for schools. CMSD has sold 775 composting machines and 22 vermicomposting machine. However, CMSD opposes a grant program funded by increasing the land fill tipping fee. CMSD recommends funding the grant program by other means that would not require a pass -through to CMSD residents. CMSD supports the promotion of local zero waste activities. CMSD is in the process of developing its own Zero Waste Plan. 10. Other 25% Define Post -Recycled Residuals – Define post -recycled residuals used for energy recovery as those materials that have less than a total specified amount of designated recyclable/compostable materials, unless the recovery facility operator can p rove there is no feasible market for any remaining recyclables above a specified minimum standard. CMSD proposed position: None Board of Directors September 11 , 2012 Page 8 of 8 Strategic Plan Element & Goal This item will achieve the objective and strategy of CMSD’s Strategic Plan Element 2.0, which s tates: Objective: “Our objective is to manage the collection and recycling of residential trash in the most economical and environmentally friendly way” Strategy: “We will do this by looking for ways to improve efficiencies, achieve high customer satisfa ction, and considering prudent new recycling methods.” Legal Review Not applicable Financial Review The cost to draft and send comments to CalRecycle is minimal. Committee Recommendation Not applicable. Public Notice Process Copies of this report are on file and will be included with the entire agenda packet for the September 11 , 2012 Board of Directors meeting at District Headquarters and on District website. Alternative Actions 1. Do not send comments to CalRecycle and direct staff for more inform ation.