What's Happening?

The California Department of Resources Recycling and Recovery (CalRecycle) published proposed regulations to amend the Recycling and Disposal Reporting System (RDRS) to increase the specificity of waste and recycling information that waste haulers, landfills, transfer and hauling facilities, composting facilities, recycling facilities, and certain brokers and transporters must report to the state. The proposed amendments carry out the mandates in two California statutes: (1) Senate Bill (SB) 343, commonly referred to as the “Truth in Labeling Law,” and (2) Assembly Bill (AB) 881, which addresses exports of plastic waste. The proposed regulations aim to advance California’s long-standing statewide waste and recycling goals by imposing additional reporting requirements on certain entities that handle plastic waste. The public comment deadline is March 15, 2023, following a hybrid public hearing on the rule.

Key Takeaways

• CalRecycle proposes to collect information on what material types and forms facilities actively recover and how they collect that material. The information would characterize what is and is not “recyclable” for purposes of SB 343.
• The proposal adds reporting requirements for “reporting entities” (e.g., solid waste landfills, haulers, transfer and hauling facilities, composting facilities, recycling facilities, and certain brokers or transporters), including for types of material collected and the origin of the material. The proposed rules also require reporting entities to retain records for five years.
• CalRecycle would collect information regarding the amount of mixed plastics exported from the state. This information would be used to understand the jurisdiction of origin for such plastic. Certain export activities would not qualify towards diversion goals and would defined as “disposal.”
• Recycling of plastic waste through chemical recycling technologies would not qualify as recycling for purposes of calculating whether a particular material is “recyclable” under California law.

California’s Truth in Labeling Law (SB 343)

Background

California enacted Senate Bill 343 on October 5, 2021, with the intent of ensuring that claims related to a product’s recyclability or a product’s packaging are truthful and to ensure that consumers have accurate and useful information to properly handle the product or packaging at the end of its useful life. To achieve those goals, SB 343 prohibits the sale or distribution of a product or packaging with deceptive or misleading recyclability claims. To that end, SB 343 prohibits the use of a chasing arrows symbol unless the product meets statewide recyclability criteria.

To be “recyclable” in the state, the statute requires that:

• the product or packaging must be collected by recycling programs for at least 60% of the population of California, and
• the material is the type that can be sorted by recycling processes and facilities that collectively serve at least 60% of recycling programs statewide. The sorted stream must be sent to and reclaimed at facilities “consistent with the requirements of the Basel Convention.”

These requirements add to the threshold in the U.S. Federal Trade Commission’s Green Guides, which states that unqualified recyclability claims should not be made unless appropriate recycling facilities are available to at least 60% of consumers or communities where the product is sold. Suppose a product does not meet this definition or one of the exemptions, but uses the chasing arrows symbol or makes another recyclability claim. In that case, it could be considered deceptive or misleading, and the product manufacturer could be subject to penalty.

Proposed Regulations

These regulations would fulfill CalRecycle’s legislative mandate to collect specific information about material collection, including the types and forms of materials collected and recovered. CalRecycle can use this information to determine whether a product or packaging is “recyclable” under California law.

Entities subject to reporting in the RDRS include solid waste landfills, haulers, transfer and hauling facilities, composting facilities, recycling facilities, and certain brokers or transporters.

Among other items, the regulations would:

• Define ‘recycle’ and ‘recycling’ to align with Public Resource Code sections 40180 and 41821.5, which define recycling expansively. Rather than limit recycling to “collecting, sorting, cleansing, treating, and reconstituting materials that would otherwise become solid waste” (§ 40180 (emphasis added)), section 41821.5 defines recycling to include processes “applied to materials that have value principally as a feedstock.” The change helps clarify that RDRS reporting obligations apply to materials regardless of whether the materials have been discarded or constitute solid waste. (See SB 54, Sec. 3.)
• Notably, because section 40180 explicitly excludes chemical recycling from the definition of “recycling” (i.e., transformation as defined in section 40201), materials that can only be processed through chemical recycling would not be considered “recyclable” under SB343, nor would they count as “recycled” materials in the RDRS, if the regulation is finalized as proposed.
• Require that reporting entities identify the specific materials in any mixed streams accepted, hauled, or transported. See Initial Statement of Reasons, p. 34.
• Require reporting entities to report collection methods for materials. Id., p. 18, 25, 27, 30.

AB 881

Background

AB 881 targets a specific group of plastics in California’s waste stream to help the state achieve long-standing recycling goals established by the California Integrated Waste Management Act of 1989. The 1989 Act requires each Californian city, county, and regional solid waste management agency to develop waste management plans to divert waste from landfill disposal.

The 1989 Act and subsequent legislation have defined California’s recycling mandates and goals, among them:

• a 50% solid waste diversion mandate by 2000 through source reduction, recycling, and composting;
• a 75% reduction of disposal goal by 2020 (AB 341, Chapter 476, Statutes of 2011);
• mandatory commercial organics recycling (AB 1826, Chapter 727, Statutes of 2014);
• and reducing short-lived climate pollutant emissions from landfills by 2030 (SB 1383, Chapter 395, Statutes of 2016).

CalRecycle tracks each jurisdiction’s performance under the Integrated Waste Management Act by collecting data from businesses, facilities, and operations that handle waste on the amounts of materials recycled, composted, source reduced, or disposed of in a landfill from each jurisdiction in the Recycling and Disposal Reporting System (RDRS).

Many materials are readily recyclable within the state. However, some more difficult-to-recycle materials, such as certain mixed plastics, have been exported to other countries, particularly in Asia, such as China, Taiwan, and Vietnam, for years. Exported plastics, however, are not always recycled. AB 881 reclassifies specific types of exported plastics that are typically more difficult to recycle as “disposal” for RDRS reporting purposes, regardless of whether they are recycled or not. This reclassification means that certain mixed plastics exported from California are per se excluded from being considered “recycled” or “diverted from disposal” to collect recyclability data and track performance under the state’s diversion goals and mandates. Additionally, AB 881 requires CalRecycle to collect information on the jurisdiction of origin for exported mixed plastic waste. This will allow CalRecycle to calculate “disposal” amounts more accurately for each jurisdiction that reports in RDRS.

Proposed Regulations

The proposed regulations would allow CalRecycle to collect information regarding the amount of mixed plastics that originates in but is exported from California. These mixed plastics would include polyvinyl chloride (resin code #3), low-density polyethylene (#4), polystyrene (#6), and other plastic (#7). The following more easily recyclable plastics would not qualify as “mixed plastics”: polyethylene terephthalate (#1), high-density polyethylene (#2), and polypropylene (#5).

The regulations would also require CalRecycle to modify definitions of “disposal” to match that of the statute such that export of the covered mixed plastics outside of the United States is considered disposal, not diversion. Under the statutory text of AB 881, however, exports to Canada or Mexico are not considered “exports” until January 1, 2024, or “the expiration of a relevant trade agreement.” (AB 881, Section 1, adding Section 41781.4 to the Public Resource Code).

Other key proposed terms include:

• Requiring reporting entities to report tons of exported mixed plastic waste, including tons of each material type sent to “each destination region,” and “the tons sent from each jurisdiction of origin across all material types and destination regions.” See Initial Statement of Reasons, p. 16, 19, 24, 28, 30, 40.
• Adding records retention requirements to maintain records to verify jurisdiction of origin. Id., p. 45.

Impact on California Regulatory Framework and Broader Implications

Updates to Waste Reporting System

The proposed updates to the RDRS will affect various California programs that aim to increasingly create a closed loop/circular economy.

• In California, SB 54 will require single-use packaging and plastic single-use food ware producers to ensure that such materials are recycled at increasingly higher rates until 2032, when 100% of covered materials must be “recyclable.” By further constraining what materials are considered “recycled” and “recyclable,” SB 343 and AB 881 and their implementing regulations will affect how plastic packaging and plastic food ware manufacturers develop such products for California.
• CalRecycle’s Rigid Plastic Packaging Container (RPPC) program will also be impacted. In general, the RPPC program requires producers of products sold in certain types of rigid plastic packaging to prove either that the packaging is composed of 25% post-consumer recycled material, that the producers have removed the equivalent amount of California post-consumer recycled plastic from the state and incorporated it into other plastic products, or that the packaging has been source reduced. By more restrictively defining what materials are “recycled” and “recyclable,” SB 343 and AB 881 will constrain plastic packaging producers. Producers will have fewer California post-consumer recycled plastic types available for incorporating into plastic products for RPPC compliance.

Impact on Global Trade

AB 881 and the proposed regulations explicitly exclude the export of plastic waste outside of the United States from counting towards diversion efforts, regardless of whether the plastic will be sent for recycling abroad. Given the scale of California’s consumption of plastic, implementation of these changes may impose further reductions in the volume of plastic waste feedstocks that are traded for recycling purposes. These shifts can inhibit global circular economy efforts for plastic feedstock movements and further the trend toward the proliferation of regulatory controls that impose regional or national circularity networks.