Opinion

Urgent need to fix California’s ‘bottle bill’

Crushed containers await recycling at a California facility. (Photo: Joseph Sohm)

It is impossible not to notice that in California the ethic to recycle is strong. We take pride in being the best in the nation and we have trained our public well to do the right thing when it comes to recyclable materials

You see signs of it in coffee shops, movie theaters, parks and street corners – separate refuse containers for beverage containers, organic materials to be composted, and for rubbish. As a rule, you also see people making earnest efforts to discard the right materials into the right containers. We also see a culture of reducing, reusing and straight up rejecting things that don’t fit our culture. The recent movement by consumers to reject single-use plastic straws and plastic bags has shown us the power of the people and how strong their desire is support our environment.

Enacted 30 years ago, the ‘bottle bill’ placed California in the vanguard of the modern recycling movement

Unfortunately, these hopeful signs are somewhat deceiving.

The fact of the matter is that recycling rates are falling in California. For the first time in a decade, the percentage of beverage containers being recycled has dropped below 80 percent. The decline means that about 1.7 million containers that five years ago were being recycled are today being buried in landfills or, worse, tossed aside as litter.

Part of the problem is that California’s landmark Bottle Bill is broken. There is an urgent need to fix it, starting with steps that our elected representatives here in Sacramento can be take right away.

Enacted 30 years ago, the Bottle Bill placed California in the vanguard of the modern recycling movement. The idea was elegantly simple: levy a small charge (a “redemption value”) on each beverage container sold, and then refund it when the container is turned over to be recycled. It created a financial incentive, small but effective, to encourage consumers to do the right thing.

The Bottle Bill has been spectacularly successful. Over the years, nearly 400 billion containers have been recycled.

The program is faltering today because the process for consumers to reclaim the redemption value has become less convenient. Almost 1,000 neighborhood recycling and redemption centers have been shuttered over the last five years and two economic factors are to blame.

First, the underlying value of recyclable materials has plunged, making it harder than ever for recycling centers to turn a profit.

Secondly, while wages, benefits, fuel, rent and most other costs have steadily risen, the processing fee meant to support the industry which is paid by the state, has dropped sharply, from about $1.05 to process 100 containers in 2015 to about 83 cents today.

These two factors have created a tsunami of uncertainty in the industry and caused many redemption centers to simply shut their doors.

For many suburban Californians, this trend may be hardly noticed. Their cities provide curbside recycling, and they can place their recyclable beverage containers in a barrel next to the driveway once a week. But curbside collection and customer redemption are two very different things. In only one of those scenarios does the consumer get their money handed back to them.

SB 452 would restore processing fees for CRV recyclers to the 2015 level and provide some time for California to explore different markets and innovate changes to make the law stronger

In addition, urban and rural Californians have fewer options. They rely on these neighborhood recycling centers to responsibly redeem their containers and recapture the $1.20 redemption value the spend whenever they buy a case of soda. In fact, a recent survey showed that almost 13% of those surveyed “relied” on the money they made by recycling their bottles and cans to “make ends meet” while almost 35% indicated redemption was “an important part of their monthly budget.”

State officials and businesses in the recycling industry have been discussing for years modifications to the Bottle Bill to adapt it to a variety of factors that have changed over the last 30 years. Those discussions should go forward; all good things need to be kept up to date.

But immediate action is needed before the state’s recycling infrastructure collapses entirely. An urgency bill, SB 452 by Sen. Steve Glazer, D-Orinda, is now before the Assembly and must be sent to the desk of Gov. Jerry Brown by Aug. 31.

SB 452 would restore processing fees for CRV recyclers to the 2015 level and provide some time for California to explore different markets and innovate changes to make the law stronger. It would also require the state to focus its resources on providing more recycling opportunities in areas that are now critically underserved. These actions would stabilize and help repair the marketplace to allow the remaining neighborhood recycling centers to survive and encourage others to reopen. AND the funding for this short term fix exists within the fund itself which currently has a surplus. There is no reason for SB 452 not to pass easily through the process.

The people of California have proven their ethic to recycle is strong and that they want to do the right thing. SB 452 allows their elected representative to step forward and restore opportunities for them to do so.

Ed’s Note: Jenna Abbott is Director of Protect CRV, a coalition of local recycling center owners and customers that works to protect our state’s neighborhood recycling infrastructure.

 


  • Leonard Lang

    SB 452 has been influenced by a few stakeholders. Big Waste has signed on to support (Recology, Republic and WM). They believe that they will increase revenue from processing payments but as you’ll see in my story, there is no evidence that that will happen.

    Who is really behind SB 452? At its core, you have rePlanet and CAW. They created a front organization called CA CRV Recyclers Association. They have used that to manipulate support or the appearance of it. I believe they approached the haulers. But did anybody research their claims? The author’s office will not respond to my inquiry and likewise CalRecycle.

    But the facts are simple. In 2018 the processing payments are significantly higher than they were in 2015. By simply using 2015 cost to recycle they ignore the other side of the equation used to calculate processing payment. The other side of the equation is scrap values and those have been dropping. I believe they will continue to drop as market issues with China and the rest of Asia continue.

    So the question is simple. Can anyone prove that simply by using the 2015 cost of recycling will increase processing payments to recyclers and curbside’s? If it can’t be proven then CAW and rePlanet are good con artists.

    Let me know if you get an answer.

    • Mark Murray

      The 2015 Surveyed Recycling Cost for PET was $478/ton. With 4 years of cola & RFI, that number will be about $577/ton under SB 452. The current (2018) Surveyed Recycling Cost with RFI is $485. Regardless of scrap value, processing payments to all certified recyclers under SB 452 will be approximately $90/ton higher. For Curbside this will mean $2 million more per year. For ‘oldline’ $10 million. For CZ Recyclers $5 million. About $800 per center per month. While this won’t solve the China/National sword revenue loss, this will help some.

  • http://www.protectcrv.com Jenna Abbott, Protect CRV

    As the author of the article and the Executive Director of Protect CRV I can say, with certainty, that Protect CRV is not a front for anyone or any group. We are an independent, industry-supported trade association and our mission is to support the CRV recycling trade and its supply chain.

    • Mark Murray

      Jenna, Mr. Lang is a clueless rightwing crank who hasn’t worked in the recycling industry in more than a decade. From his description below, he clearly has no idea how Processing Payments to recyclers work. His lone ‘claim to fame’ is this call-in rant on Glen Beck: https://www.youtube.com/watch?v=LfkjDohFXnE

      • Leonard Lang

        While young Mr. Murray may be accurate that I have not been in an operational position for over 10 years, I have 36 years in the business. That’s how I recognized that recyclers were being damaged by their lack of knowledge and understanding of the legislation and regulatory process. So in those 10 years from my operational days, I have worked with hundreds of recyclers. In the process of defending them from unjust and fabricated charges by CalRecycle, I have read over 22,000 pages of accusations and I have successfully defended some. Those that were successfully defended fell subject to bad law.
        No recycler in this program is safe. I have teamed with an attorney, and between us, there is no one else has defended more recyclers and processors. We know the bad law from the inside so this is what I call “The Fix”. The current system is built on a combination of statute, regulation and underground regulation that “Denies Due Process”. So if I’m a right wing crank, at least I speak with the knowledge of the law and the current situation that recyclers in this program face. The following will educate all as to why anyone who invests in this business could lose it in a blink.

        What’s really needed in legislation.
        1. Authorization of de novo review by the Superior Court. By creating a vested right in the certification, the voluntary operators will have the ability to get a full and fair de novo review. A de novo review allows the Superior Court to review the entire record and weigh the evidence and make its own findings of fact.

        2. CalRecycle must be mandated to implement regulations setting forth disciplinary guidelines so that business operators, hearing officers, ALJ’s and judges all know what an appropriate penalty should be for any violation or combination of violations. Through rulemaking and the comment process operators can participate in the standards adopted. Fair regulations should distinguish between minor and serious violations to eliminate and prevent the current draconian system. The legislature should also do away with strict liability application of serious violations. Indeed, any violation that contemplates fraud should require the common law elements of fraud, such as intent to defraud, detrimental reliance, and damages. Any situation that allows for restitution should require that the Department prove a loss.

        3. The legislature must repeal the uncontrolled use of emergency regulations which denied businesses the rights provided by the APA to participate to provide better procedures, demand clarity and air issues of excessive burden.

        4. CalRecycle has the authority to imposed prepayment controls if regulations are adopted but they have not. They assume the power to deny or withhold payments to recyclers based upon the staff’s review of documentation and/or spikes in volume. This procedure is done without a hearing and without regulations. This allows staff to starve (confiscate private property) a business of cash followed by the shutdown of the business. All done without due process. Processors should object to the policy but they don’t. A solution to this problem is for the Department to enact regulations which allow for the operators to contest the basis for withholding and denying payments quickly. This was provided for by the original statute and it regulated the abuse of power. Staff secured statutory changes to cover their own past violations and secure increase power for the future.

        5. The certification process has evolved from its original methods in the something that is extremely burdensome. Standards imposed through underground procedures have allowed them to illegally lengthen the process while imposing demands not adopted in regulation. After being provided additional time in statute, they ignore the mandate. The law provides certification for a five-year periods. When an operator renews, Certification staff has ignored experience or years of operation and look for excuses to renew them with a probationary certification. The Department, using the renewal process, can reduce and/or eliminate specific rights and protections that a fully certified operator has without a full and fair adjudication. This places the recycler in a position of uncertainty and loss of years of goodwill. It ignores the service provided to the public. It’s an impediment to further investment. Once the certification becomes probationary, staff can revoke it with a ten-day notice or less. History shows business people are unwilling to invest in a high-risk operation that can ultimately be shut down at the whim of a state agency. CalRecycle must be instructed to act in a responsible and sustainable manner and not a destructive one.

        6. Under the current culture, standards of competency have been and continue to be lowered and ignored. When this occurs and does so in concert with the grievances above, there is little possibility that justice will prevail. When they profess skills under oath that they do not possess, justice will not prevail. If the life savings of a small entrepreneur is not treated with respect and encouragement the public will not be served.

        7. In the Act, record-keeping violations have been codified. As a matter of policy, the author should have never been permitted to do this. These are better left to regulation because it is meant to educate as well as permit participants to comment to insure the guarantees of the CA Administrative Procedures Act (APA). The statute should be corrected.

        8. Over the years, the department has had detrimental influence over the program by instigating statutory changes that were directly aimed at weakening legal protections for all participants. They have created a minefield. This has now evolved to the use of budget bills to avoid transparency, implement onerous changes which beget onerous emergency regulations which are never adopted. It’s stealth legislation. The statute must be corrected to prevent this.

        9. CalRecycle continues to expand control over the participants with the use of underground regulation and the threat of enforcement circumventing due process. This requires a third audit.

        10. Unauthorized enforcement of law and regulation outside the Act (Public Resources Code). CalRecycle has enforced the laws of Measurement Standards (DMS) and CA Penal Code. This must be prevented.

        Mr. Murray also fails to recognize that I have run processing plants and MRFs. I have directed lobbyists for ISRI and Allan Co. and I’m a past president of the Association of California Recycling Industries (ACRI) and a former director of the Recycling Coalition of California (RCC).

        I think he and I should have a debate in public.

      • Leonard Lang

        I think it would be good to focus on clueless. Mr. Murray came along after this program began and appears to be clueless about the problems in the management of this program. In the early days, recyclers were subject to shakedowns by the auditors. I successfully helped defend some of those shakedowns (stories available upon request). That’s why Charles Calderon submitted the bill to raise the standards of both auditors and their managers. It would’ve also moved the responsibility for investigations to the CA DOJ. That’s because program management was already demonstrating incompetence. The Department oppose the bill and it died but the need for it did not.
        Ten years later, SB 1906 (2000) past the legislature. This removed constitutional protections for anyone operating as a recycler or processor. This was the biggest attack on due process and it was a bill that no one supported or opposed. Knowing the effects of this law by a knowledgeable investor would cause them to avoid the recycling industry. Who wanted this change?
        In 2003, AB 3056 passed. I called it the Christmas tree because of all the money it gave away including Market Development Payments. The most significantly was that the handling fee subsidy mechanism changed. Payments went from a simple $2300 per month to a formula that could pay out in excess of $50,000 per month to high-volume recyclers. The maximum of $35 million per year was removed and subsidy payouts increased by 50%. Why was this done? This became a boon the property owners and they soon learned to take advantage of it, windfall profits for all. Payments ballooned by millions and then we fast-forward to 2008 when the fund ran out of money.
        When the fund runs out of money the state imposes proportional reductions which reduces processing payments to all. For convenience zone operators it’s a double hit because handling fees are also hit. Now because they ran out of money they were audited in 2010. What the Auditor discovered was “Ineffective Management”. For all intents and purposes, the report was ignored and no one held accountable.
        Something else happened in 2010. The Enforcement Branch, also suffering from ineffective management, conducted surveillance and produced a report. They observed over 200 Californians importing containers from Reno. CalRecycle should’ve known that recyclers are obligated to purchase if material is labeled, within the load limits and presented by Californians. Not once did they do their job by stepping in and preventing payments by informing the recyclers. That’s what the law requires. Instead they allowed the purchases to be made so that they could go after the recyclers later.
        In 2013, the “Ineffective Management” recommended program changes and included them in a budget bill. Budget bills avoid transparency by avoiding committee review and oversight. CalRecycle gave itself new regulatory powers and did it in a manner that screwed the industry out of their right to participate, it’s known as commenting. Their stupid ideas were imposed without an ability to stop it. To date, those two sets of regulations have yet to be ADOPTED pursuant to the APA (it’s a very bad thing). It also forced the use of CalRecycle’s computer system. They probably believed that they could never get the industry to agree to use it so they shove it down their throats. Now they had new ways to steal the cash and avoid due process.
        In 2014, another budget bill was passed extending the statute of limitations and giving program management a greater opportunity to screw program participants.
        The law requires CalRecycle to protect the fund. They do not. The law requires CalRecycle to assist recyclers. They do not. Why? Years ago and unqualified bureaucrat was placed in charge of audits and investigations. Not understanding the purpose of audits to assist recyclers and protect the Fund, he combined it into an all-in-one process of investigations. They then ignorantly devised costly and ineffective policies that waste money and result in an abuse of power. No one is safe in this industry because they only know one thing, how to attack and destroy. They rule without empathy or concern about the lives they destroy. If recyclers believe it won’t happen to them, they’re kidding themselves. This program needs a big FIX. This is yet proof that California has the worst regulatory environment in the USA. They impose a “standard of perfection” which can never be met and then twist the law without mercy.
        Here’s a heads up on the next debacle. In what I consider a violation of regulation, CalRecycle takes possession of recycler and processor records. Those records should be reviewed on site. There also not determined based on a statistical sample. They ask for months and years worth of documents. Here’s the problem, they don’t return the documents. I bet they don’t even know where they’re at.

        Come on Mark, let’s debate the merits of this program publicly.

      • Leonard Lang
    • Leonard Lang

      I have been watching the activities of these organizations since the beginning. As I received information on their activities I had the question what is the motivation and who felt a need for Protect CRV? I always question motivation. It’s a part of my behavioral training

      According to the SOS filing, we can see that the nonprofit Association, Protect CRV, began in late April with the stated purpose of providing advocacy and education for California’s 1700 CRV recyclers. We can see that the officers, other than Ms. Abbott, come from 1 Sacramento processor tied to rePlanet. Finally, as director of this Association, we don’t find any experience pertaining to this industry. In a conversation with a director of CRRA where she spent a short time, she came with no knowledge of recycling.

      So who selected her? And who felt the need for a new Association? We already have 2, ISRI and ACRI. I have served on the legislative committee of ISRI and I’m a past president of ACRI. The lobbyist for ISRI has told me, that I’m the only one who reads all information, legislation, and regulation that covers the CA Bottle Bill. Based upon my testimony last year, one lobbyist called me the historian of the program. I am.

      https://www.youtube.com/watch?v=TxJOuc4LyOE&t=23s

      From their own publication we know the following people are involved:
      Kenny Luong (Ming’s Recycling) Chairman
      Jack Waite (Recycling Zone) Vice Chairman
      Jeff Donlevy (Ming’s Recycling) Treasurer
      David Lawrence (rePlanet) Director at Large
      Jenna Abbott, Executive Director and Secretary
      The chairman, vice-chairman and treasurer for are tied to rePlanet for business. The director at large is the president of rePlanet. Many of the recyclers who were recruited were deceived because they weren’t aware that some of the actions taken by this group were detrimental to their business.

  • Leonard Lang

    If the public and the industry is truly concerned about why there have been so many closures of recycling centers there needs to be a thorough analysis. The majority of closures of come from one company. In my opinion, they have failed business model, combined with poor management. Records obtained show that that company has forfeited subsidies because their sites were not open or unable to purchase containers. I hear from employees that these problems still exist because the sites do not get emptied on a timely basis.

    For the independent operators it’s been a different story. Cities associate these recycling centers with the homeless. They either put pressure on the landlords or they take action themselves to close the centers. Fresno violated their own ordinances in an effort to shut down convenient zones. Their efforts cost the city legal fees to fight a losing battle, and waste their resources.

    Finally, there is one more reason. CalRecycle has a hostile behavior towards the industry. They use it to deny subsidy payments whenever they can. When a recycler cannot depend upon subsidy payments they lose motivation and close. Then there’s misguided and abuse of enforcement action. In the past week alone I have learned of 5 unnecessary closures with at least 2 in zones.

    https://www.youtube.com/watch?v=UxhORlBMHO8&index=19&list=LLwN2rODIP3JziP6zUktGtLg

  • Leonard Lang

    Free money! rePlanet collects CRV and handling fee subsidies without paying the public.
    It’s a violation of the law but its not the only illegal benifit they have received from CalRecycle.
    https://www.youtube.com/watch?v=tymHSzR28y4

  • Leonard Lang

    SB 452 Another Patch
    In January of this year we learned from the grocers who published an article in their monthly magazine, that the Beverage Container Recycling Program has been changed over 75 times. If the Governor signs SB 452 it will become more than 76 times.
    Patch: Mend, cover a whole or weak spot, hide a blemish, and cover a wound. These are a few definitions of the word. But this bill we solve a professed problem by creating new problems that will need to be addressed in the future. We will have to come back and fix the problems this bill creates.

    CAW has been in support of this bill. Let’s say that this bill will cost $70 million up to $100 million over the life of the law. It was 20 years into the program, 2008, when the fund ran short of money. The result was that all recyclers were hit with a cut to their processing payments. Without adequate processing payments, recyclers lose money and possibly their business. Handling fee recyclers took a double hit with the same reduction to their subsidy. How well would you fair if your monthly income was cut by thousands of dollars. The bigger the business, the bigger the cut.

    So here we go again. Processing fees stay the same while processing payments and handling fees are increased. A double hit to revenue of the Fund. Can we afford it? CalRecycle staff fear the Fund depletion. They do everything they can to assess penalties on recyclers and close them down affecting public convenience. Recently, a CalRecycle Enforcement Supervisor said the fund was still in trouble and that they would be targeting processors. Latinos and immigrants are often the targets.

    Most of the effects of this bill will be over in two years but I expect it will cause more problems than it pretends to fix. And don’t think that things will stay the same. Young Mark Murray is still trying to push for a bankrupting recycling rate of over 80%. I have long said that this program should be designated as the Lobbyist Full Employment Act by the legislature.

    https://www.youtube.com/watch?v=TfdtjfdNwQE&t=33s

  • Leonard Lang

    As the governor is pondering whether or not to pass or veto SB 452, the main beneficiary rePlanet has chosen to honor competitors coupons. We know that this is happening in the Inland Empire. Coupons for two dollars per pound are being honored. As a test, a site attendant was asked if they would honor a coupon for $2.15 a pound on aluminum cans. The answer was yes. So as rePlanet is not overtly advertising and paying premiums, they are doing it covertly. Early questions whether or not they need the money doesn’t it?
    Here’s the background. https://www.youtube.com/watch?v=eMU0Z8fEiZE&t=24s

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