Producer Responsibility for Packaging and Paper Products.

Producers of paper products and packaging (covered PPP) must participate in a producer responsibility organization (PRO) that is required to carry out specified activities, including the implementation of an approved PRO plan.

Producers are defined to include specified entities associated with covered PPP but do not include government entities, nonprofit organizations, or entities that sell, distribute, or import de minimis volumes of paper products or packaging.  

Packaging is defined to include various materials, including single-use items that facilitate food or beverage consumption, but does not include materials intended for long-term use associated with durable products, materials used to package federally regulated pesticide products or animal biologic products, reusable or refillable propane gas containers, paint containers, newspaper, paper used for building construction, or certain products that are individually or categorically excluded temporarily after a determination is made by the Department of Ecology (Ecology).

Significant program implementation deadlines applicable to producers and the PROs in which they participate include:

• By July 15, 2024, producers that offer for sale, sell, or distribute covered PPP in Washington must join a PRO registered with Ecology or register as a PRO.  Registrations must be updated annually with Ecology.
• Beginning in June of 2025, PROs must submit an annual payment to Ecology to cover Ecology's administration and oversight costs and other specified costs related to the program implemented by a PRO, based on an annual workload analysis completed by Ecology beginning in April 2025.
• Within six months after the adoption of Ecology rules, registered PROs must submit an implementation plan to Ecology for approval.
• Beginning January 1, 2028, or within six months after Ecology's approval of a submitted plan, whichever is later, PROs must begin implementing the approved plan.
• Beginning July 1, 2029, PROs must submit an annual report to Ecology. 

For the first plan implementation period, Ecology may approve only a single PRO, exclusive of any producers independently fulfilling the responsibilities of a PRO.  The bill provides additional implementation logistical details to PROs that register with Ecology after 2026.  Ecology must review and may approve submitted plans and annual reports, and additional logistical details are provided in the event that a submitted plan or report is not approved by Ecology.  Specific duties and authorities are assigned to Ecology, including the authority to adopt rules, to issue civil penalties and orders, and carry out specified tasks, such as:

• the maintenance of a public website;
• the completion of a performance rates study by September 1, 2024, that recommends performance rates for the reuse and recycling of covered PPP; and
• the completion of a statewide needs assessment by July 1, 2025, that evaluates the costs, gaps, and needs for recycling services and infrastructure for covered PPP, as well as other components of the PRO programs to be implemented for covered PPP.

Ecology must seek to harmonize its adopted rules with regulatory standards, exemptions, reporting obligations, and other compliance requirements of other states that have adopted similar programs, except where conflicts exist with Washington program requirements established in statute.  

An advisory council is created, with membership representing specified interests to be appointed by Ecology.  The advisory council is given specified responsibilities with respect to aspects of PRO program implementation and Ecology's oversight of those programs, including:  (1) responsibility for advising or commenting on the performance rates study, and the needs assessment prior to their completion; and (2) the program plans and annual reports submitted to  Ecology, prior to Ecology's determination of whether to approve plans and reports.  For certain aspects of program implementation, the PRO must also seek input from the Utilities and Transportation Commission (UTC).

PRO plans for covered PPP must contain specified components governing the major components of the producer responsibility program for covered PPP that the PRO is obligated to implement, including:  (1) information regarding program financial structures and investments in recycling infrastructure; (2) education and outreach activities; and (3) collection of covered PPP.  The plan must also include other detailed information regarding the products managed through the PRO, and other waste reduction and recycling outcomes to be achieved by the PRO.  Plans submitted to Ecology have a duration of five years.  Plans must include a contingency plan component that demonstrates how plan activities will be carried out by an entity other than the PRO in the event that the PRO is unable to carry out plan implementation for specified reasons.  

PRO plans, and the program implemented by a PRO, must provide for:

• the collection and management of covered PPP in a manner that meets specified standards, including:
  • environmental performance standards to be achieved by any recycling technologies other than mechanical recycling; and
  • the reporting of information to Ecology by material recovery facilities and other processing facilities managing covered PPP under the program;
• the achievement of specified types of recycling and reuse performance rates proposed in the PRO's Ecology-approved plan;
• full funding of the PRO's operations in a manner that does not involve a point-of-sale fee charged to consumers, but that is instead based on a system of fees collected from participating producers of covered PPP, including:
  • a de minimis level at which no fees are charged;
  • additional charges for producers of postconsumer recycled content (PCRC) products, who have additional regulatory obligations managed by the PRO; and
  • the use of eco-modulation factors to incentivize the use of design attributes that reduce the environmental impacts of covered PPP;
• activities to make convenient collection services for covered PPP that are designated for collection under the plan, including:
  • curbside collection to residential customers wherever curbside garbage collection services are provided to those customers, unless a county adopts an ordinance to provide for alternative recycling service in those areas; and
  • the use of permanent collection facilities in other specified circumstances;
• the funding of investments in reuse and recycling infrastructure and market development, as needed to achieve the convenience standards for collection services, management standards for covered PPO collected by the program, performance outcomes identified in the plan, and any other infrastructure gaps identified by the needs assessment;
• education and outreach activities, including the performance of specified types of activities and the development of certain materials for communicating with the public; and
• the coordination of multiple plans and programs on specified components of program implementation, such as education and outreach activities and the identification of covered products for collection, in the event that multiple PROs form and register with Ecology to implement a plan or a distributor responsibility organization (DRO) forms to implement a deposit return system (DRS).

Each PRO must submit an annual report on the prior calendar year's program implementation activities.  The annual report must contain data, descriptions and information sufficient to allow Ecology to determine whether the PRO has fulfilled its plan and program implementation obligations, and other specified types of information.  Prior to the submission of the annual report, all nonfinancial data and information must be audited annually by an accredited third party, and a separate independent financial audit performed by an independent auditor must be performed and submitted to Ecology.

Local governments that use contracting authority for recyclable material collection are not obligated to participate in a PRO's plan.  Existing city and county authorities to establish solid waste systems are not limited by the establishment of PROs for covered PPP, including the authority to include materials in curbside collection that are not part of the statewide list of covered PPP designated for collection under the PRO's program.  Curbside collection of recyclable materials in areas where the UTC oversees the collection of solid waste must be provided by companies that hold UTC-issued solid waste certificates.  PROs must provide reimbursement to UTC-certified solid waste service providers in accordance with rates approved by the UTC.  To be eligible for reimbursement from a PRO, a UTC-certified solid waste company must provide service that offers single-family and multi-family residential recyclable material collection services for covered PPP wherever garbage services are offered unless the county has adopted an ordinance providing for alternative collection of covered materials.  

Government entities may enter into contractual agreements with PROs for purposes of cost reimbursement.  The PROs must reimburse government entities for services delivered in accordance with base cost formulas established in the PRO's plan for curbside collection services, and in accordance with other reimbursement rates for non-curbside collection services that must also be established in the PRO's plan.  Government entities that receive reimbursement for costs incurred in delivering curbside collection services must report or publish reimbursed costs to residents annually and as part of any solid waste rate increase notifications. 

The source separation strategies of waste reduction and recycling elements contained in a local government's solid waste plans must include PRO programs for covered PPP, and any DRS for beverage containers operated by a DRO.  Solid waste management plans may reference PRO plans to fulfill source separation strategy requirements beginning in 2026, and must reference PRO and DRO plans beginning in 2027 for purposes of the local government's recycling contamination reduction and outreach plan element.

Producer responsibility organizations and material recovery or processing facilities may request that information submitted to Ecology be kept confidential, and Ecology must keep that information confidential if not detrimental to the public interest.  The PROs may not use funds collected for purposes of implementing a plan for certain purposes, such as payment of administrative penalties or litigation.  

Ecology may impose civil penalties on persons in violation of requirements.  If a PRO does not meet a significant requirement, Ecology may additionally issue orders to a PRO, revoke the PRO's plan approval, require a PRO to revise and resubmit a plan, or report additional information.  Penalties from Ecology are appealable to the Pollution Control Hearings Board (PCHB). 

The UTC must review PRO reimbursement of regulated service providers, and must require UTC certificate holders to implement services designated by a PRO in an approved plan for the management of covered PPP.  The UTC-regulated solid waste companies must meet curbside collection service standards established in an approved PRO plan for the management of covered PPP.  Services contained in the base rate charged by solid waste collection companies include costs related to the implementation of services designated by a PRO in an approved plan.  Covered PPP and beverage containers under a DRS are excluded from the recyclable materials collected by a UTC-regulated solid waste collection company that the company may retain up to 50 percent of the revenue from.

Postconsumer Recycled Content Requirements.
The compliance logistics for covered PPP whose producers participate in a PRO and which are subject to existing minimum PCRC requirements, including plastic beverage containers and personal care and household cleaning product containers that are not regulated under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), are shifted so that registration, annual fee payment, reporting, and penalties related to PCRC requirements are managed through the PRO, rather than directly by Ecology. 

Ecology retains direct management responsibility for PCRC requirements for products other than covered PPP that remain subject to PCRC requirements such as plastic trash bags and FIFRA-regulated household cleaning and personal care products.  For products directly managed by Ecology, producers must submit an annual certificate of compliance to Ecology.

The method of imposing penalties for violations of PCRC requirements is also changed from a per-pound of underperformance penalty to a per-day-of-violation penalty. 

The scope of products subject to minimum PCRC requirements is expanded to include new products, some of which are covered PPP and whose PCRC obligations are managed through the PRO, and some of which are not covered PPP and whose PCRC obligations are managed directly by Ecology. 

The following products which are to be managed through the PRO have new PCRC requirements established for their plastic containers:

• plastic tubs for food products, requiring 10 percent PCRC from 2026-2030 and 30 percent PCRC beginning in 2031;
• single-use plastic cups:  polypropylene cups requiring 15 percent PCRC from 2029-2030 and 25 percent PCRC beginning in 2031; and other types of single-use plastic cups requiring 20 percent PCRC from 2029-2030 and 30 percent PCRC beginning in 2031; and
• thermoform plastic containers:  packaging for consumable goods requiring 10 percent PCRC from 2031-2035, and 30 percent beginning in 2036; and packaging for durable goods requiring 30 percent beginning 2036.

Plastic plant pots and trays, overseen by Ecology, will require 30 percent PCRC from 2026-2030 and 80 percent PCRC beginning 2031.

The Liquor and Cannabis Board (LCB) is directed to update its rules related to the packaging of cannabis products to reduce the use of plastic packaging in amounts commensurate with the source reduction rates proposed by a PRO, and to allow for and encourage the use of reusable containers.  In consultation with Ecology, the LCB may also adopt minimum PCRC requirements for cannabis packaging of up to 25 percent through 2030 and at least 50 percent beginning in 2031.

De minimis producers are made exempt from PCRC requirements, but must annually notify the PRO or Ecology, as appropriate, of the producer's de minimis status.  For annual reporting regarding PCRC products managed through the PRO, the PRO must include a certification from an accredited independent third party verifying the quantity and dates of PCRC material purchases.  Ecology must review and determine whether to approve PCRC annual reports.  Producers of PCRC products may petition for temporary exclusions and PCRC rate adjustments for an upcoming year in a manner similar to the processes available to PCRC products directly overseen by Ecology, but petitions must be submitted through the PRO.

Deposit Return System.
As an alternative to satisfying its covered PPP obligations for qualifying beverage containers (QBCs), a PRO may not consider QBCs to be covered PPP upon the establishment of a DRS for QBCs by a DRO.  An individual beverage distributor may form a DRO and implement a DRS, or a group of beverage distributors representing a majority of beverages sold in QBCs may form a DRO.  Qualifying beverage containers include individual, separate, sealed glass, metal, or plastic bottles or cans other than cartons, foil, pouches, drink boxes, or metal containers that require a tool to be opened, and exclude containers for dairy milk, infant formula.  Beverage containers of less than 4 ounces or more than 1 gallon are not QBCs.

By July 1, 2024, or four months after a DRO is approved by Ecology, distributors of QBCs must join a DRO.  Distributors that do not join a DRO or independently fulfill a DRO's responsibilities may not sell beverages in QBCs after October 1, 2024, or 120 days after DRO approval by Ecology.  The DROs must register and submit initial information to Ecology related to covered QBCs and DRO members, and must begin submitting annual reports containing additional specified information to Ecology after the DRS has been implemented.  Ecology will review annual reports, makes public DRO reports, and may review the financial records of a DRO related to the accuracy of the QBC redemption rate reported to Ecology.  Ecology may require a DRO to retain an independent audit firm to determine redemption rate accuracy.  Distributor responsibility organization annual reports must also include verification from a third-party financial audit confirming the DRO's budget, the total value of unclaimed refunds, and a verification that funds represented by the unclaimed refunds were not distributed to members of the cooperative as a dividend.

Distributor responsibility organizations must submit annual payments to Ecology to cover implementation, administration, and enforcement costs, including rulemaking.  Annual payments are based on a workload analysis prepared by Ecology, except for annual payments by independent distributors independently fulfilling a DRO's obligations, who must pay Ecology an annual payment for oversight at a rate of 10 cents per QBC.  Ecology may also issue penalties of the greater of at least 15 cents per bottle or $10,000 on any distributor that fails to participate in a DRO.  Penalties are appealable to the PCHB.

By July 1, 2026, or within 180 days of Ecology's adoption of rules, a DRO must submit a plan for implementing a DRS.  A DRO may require the collection of deposits for up to 60 days prior to the start of the DRS to offset refund values for QBCs.  A DRO may not distribute funds from unclaimed refunds as a dividend to members of the DRO.

By January 1, 2031, a DRO must demonstrate that all QBCs are designed to be reusable or recyclable.  The DRO plans must also achieve the following performance requirements:

• by 2028, a minimum of 60 percent of QBCs redeemed for reuse and recycling;
• by 2031, a minimum of 80 percent of QBCs redeemed for reuse and recycling; and
• by the end of 2031, a minimum of 1 percent of all sales of beverages in QBCs must be in reusable packaging.

The DROs that fail to achieve these performance rates must pay a penalty of 10 cents per container below the number of containers that would have satisfied the redemption performance rate.  Ecology may alternatively identify priority areas for additional drop-off access to be provided in lieu of a penalty.  Penalties may not be assessed for lack of achievement of reuse performance requirements.  Ecology may also impose penalties of between $200 and $500 per day for significant plan implementation violations or performance requirement violations, after a 60 day period to come into compliance. 

The DROs must submit a plan meeting specified criteria, and Ecology must base its determination to approve a plan on those criteria.  The QBCs covered by a DRO plan must carry a clear and conspicuous marking of the 10 cent refund value through the abbreviation "WARV" or an alternative abbreviation approved by Ecology.  Wine containers may satisfy this labeling requirement through a quick response (QR) code.  The DROs must include a method in their plans for paying an additional refund value premium for containers returned by nonprofit organizations that serve very low-income individuals who rely on regular container refunds through the DRS as a source of daily funds.  Distributor responsibility organization plans must include education and outreach activities, including the development of materials and campaigns, the use of media channels, and the establishment of a process for resolving consumer concerns.

The DROs must provide a convenient bulk drop-off option for bagged QBCs at geographically dispersed locations.  All drop sites must be paid for in full by a DRO.  Customers may not be charged for this drop off service, and must credit back the cost of any required bag purchase.  The DROs must provide at least 270 bag drop sites, including at least one in each county and each island community served by the state ferry system.  Bag sites must be distributed by county proportional to the volumes of QBCs sold in counties.  Within two years of DRS system implementation, a DRO must increase the number of drop sites to 280.  Five years after, the DRO is required to provide 280 drop sites, and every five years after, the DRO must calculate whether beverage sale volumes have increased, and if so, must proportionally increase drop-off site locations.  Drop-off locations may be located at retail establishments, but retail establishments are not required to accept returned QBCs or to allow a drop-off location.  Certain large retailers must install a self-serve kiosk to print redemption vouchers, pay the value of redemption vouchers, and sell bags for redemption. 

A consumer convenience advisory council of at least eight members representing specified interests must be formed by a DRO to  identify potential bag drop-off locations and achieve consumer convenience.  Ecology, in partnership with the DRO, must conduct an assessment of consumer convenience after five years of DRS implementation. 

Drop-off bags made of plastic film must be at least 50 percent recycled content, and waste from film bags must be recycled by DROs in the best commercially available manner.  The DROs are not required to accept or pay refunds for contaminated, crushed, broken, or damaged containers, or containers the DRO has reasonable grounds to believe were not purchased through the Washington DRS. 

Distributors, manufacturers, or importers that fail to pay a QBC refund value to the DRO are liable for treble the collection costs incurred by a DRO for QBCs sold without the refund value. 

Distributor responsibility organizations must pay the full refund value for QBCs returned to the DRO by material recovery facilities, government entities, and other processors if certain criteria are met.  People and businesses are not required to use DRS infrastructure, and are not precluded from disposing of QBCs via curbside recycling collection systems. 

For the first five years of DRS implementation, a DRO must remit $15 million each year to the Department of Commerce (Commerce) for the implementation of a new Recycling Revenue Augmentation Fund (RRAF).  Commerce must accept requests from local governments or curbside or drop-off recycling programs to receive RRAF funds to offset revenue losses due to the diversion of scrap material to the DRS.  Requests must include third-party audited financial data demonstrating revenue losses.  Commerce must evaluate these requests and determine the validity of the data, and distribute funds proportionately based on valid requests.  As an alternative to participating in a DRO, a manufacturer of beverages that is also a distributor and sells or distributes no more than 10,000 beverages per year in Washington may operate an independent refund program.  Ecology may approve an independent refund program if the beverages are packaged in reusable qualifying beverage containers, the manufacturer offers a refund value for containers that is greater than the amount offered by the DRO, and Ecology determines that the plan provides convenient return pathways for consumer containers.  Independent refund plans must include annual reports, and authority to implement a plan can be revoked by Ecology for not providing sufficient performance or not meeting consumer convenience requirements. 

Other Provisions. 
Covered PPP of products may not make misleading or deceptive claims about product recyclability.  Certain types of claims are specified to be misleading or deceptive, or to not be considered misleading or deceptive.  Federal criteria may be adopted in lieu of these requirements.  Local governments are prohibited from enforcing ordinances prohibiting products from making specified claims about the recyclability of products. 

Ecology may participate in the development and operation of a regional or multistate clearinghouse for the purposes of facilitating laws and rules on packaging and paper products, including extended producer responsibility requirements, PCRC requirements, and requirements established by other specified state laws that regulate covered PPP, including laws regulating the toxic content of PPP.  Ecology may direct producers to register and submit data, reports, fees, and payments to the clearinghouse in lieu of Ecology. 

By December 1, 2025, Ecology must contract with an independent third party to complete a feasibility study to:  identify options to improve the convenience experienced by consumers with unwanted products or packaging covered by product stewardship, extended producer responsibility, or takeback programs; and consider tradeoffs associated with options that might improve outcomes for consumers and the management of unwanted products.  Ecology must also deliver policy recommendations to the Legislature.

In consultation with PROs and DROs, Ecology and the Department of Revenue must study the impacts of producer and distributor requirements on the litter rates of covered PPP and beverage containers, and possible improvements to the structure of the litter tax.  Ecology, in consultation with the Department of Revenue, must provide recommendations to the Legislature on the applicability of the litter tax to covered PPP and beverage containers and improvements to the litter tax structure. 

A severability clause is included. 

(In support) This bill is a priority for environmental organizations and local governments.  A comprehensive solution is needed in order to improve state recycling systems.  Extended producer responsibility organizations (PROs) for recycling work well in other countries and achieve higher recycling rates.  Other states have recently adopted laws similar to this proposal, and this is not a new concept in front of the Legislature.  Utility ratepayers are not able to affect the packaging decisions made by product manufacturers that complicate the management of the waste stream and hamper recycling rates.  The recycling rates achieved under the existing solid waste management laws have stagnated.  Recent studies show that Washington is not in the top 10 of recycling performance among states.  Extended PROs pair well with deposit return systems (DRS).  Extended producer responsibility makes producers pay for the packaging products they create, based on how hard they are to manage at the end of their useful life.  Extended PROs will decrease solid waste management financial burdens for local governments.  Plastic waste is contaminating the environment, and in particular single-use plastic waste on beaches and in marine ecosystems.  Consumers are confused over which products are recyclable, and rules for recycling vary across cities and counties.  Establishing statewide consistency in the collection of products will help the public increase overall recycling rates.  The bill should encourage compostable products, and particularly products that are capable of composting in nonindustrial composting facilities.  Producing plastic products with recycled content reduces greenhouse gas emissions.  Bottle deposit systems achieve high recycling rates by incentivizing consumers to return their bottles.  Bottle deposit programs don't require any public funds to achieve high recycling rates.  Bottle deposit programs should only be considered within a context in which an extended PRO is also established.  Changes to the original conception of the bottle deposit program included in the bill will be needed in order for beverage producers to support the program.

(Opposed) The timeline for the implementation of the program is too fast.  The performance targets and sequencing of events laid out in the bill will cause logistical challenges.  There should be a small business exemption for small breweries.  Additional exemptions and off-ramps need to be established for products that might have conflicting federal requirements, including pesticides, drugs, and veterinary products.  Products with high existing recycling rates should not be required to participate in the system.  A source reduction requirement would allow the Department of Ecology (Ecology) to ban materials instead of increasing the recycling of those materials.  The bill should focus on landfill diversion, rather than a specific source reduction rate from eliminating plastic.  The bill is too complex, and contains too much bureaucracy.  The process for getting public input and consulting with the advisory council is onerous and will make it challenging for producers to implement the program.  The bill will hurt the existing recycling system.  Requiring curbside recycling collection statewide ignores Washington's geography and density, and will require urban customers to subsidize inefficient rural collection.  Establishing a DRS will remove valuable materials from the existing recycling stream.  Restaurants do not have the space to manage beverage containers on premises.  Extended PROs are producer-funded, but will increase costs of goods to consumers.  The bill should focus on improving markets for recycled material commodities, which then wouldn't need subsidies to improve recycling rates.  Producers should not have the power to manage the state's recycling system.  The bill's provisions related to labeling of the recyclability of products will help reduce consumer confusion.  The ambiguity in who qualifies as a producer responsible for funding the PRO needs to be resolved.  Retail establishments should not have responsibility as producers.  The bill needs to be designed to ensure that paper products are not cross-subsidizing the recycling costs for plastics.  The program should be limited to residential collection of recycling only.  Wine bottles should be allowed to be labeled with a quick response code.  The approval process for alternative recycling technologies is too burdensome.

(Other) Oregon's beverage recycling system achieves an 80 to 90 percent recycling rate, as compared to less than 50 percent in Washington.  The hope is to develop a proposal for a bottle deposit program that will take the best of Oregon's system, and apply additional consumer convenience and transparency in outcomes.  A DRS will improve significantly on stagnant recycling rates.  The public supports bottle deposit programs.  Beverage producers support efficient and accountable recycling and PROs.  The current proposal, including the DRS provisions, contains too much bureaucracy, reporting, audits, and processes that will add costs.  The regulatory barriers in the bill will suppress innovation and prevent new recycling techniques.  The extended PRO should start with an initial PRO prior to allowing multiple programs.  Paint cans are managed through Washington's Paint Stewardship Program, and should be exempt from this program.  Ecology supports the policy proposals but the funds to implement the program are not in the Governor's budget.  This bill contains the top three recommendations from a recent policy report to the Legislature focused on how to reduce plastic waste and improve packaging recycling.  Many counties support many components of the extended producer responsibility proposal, but are concerned about certain negative impacts on existing operations, including the removal of valuable commodity materials from the current recycling system.  The 25 percent reuse and refill provisions for the beverage container DRS are unrealistic.  Oversight of the distributor responsibility organization (DRO) should not be more stringent than oversight of the PRO.  The bill should clarify how the DRO and PRO will coordinate together.  Existing federal requirements should be considered when deciding which products should be covered by recycling and program participation requirements.  The process for producers of animal drugs to petition for an individualized exclusion from program participation requirements will be too burdensome and subjective.  Retail establishments should not be required to serve as take-back locations or have other obligations under the program.  The bill is too big and complicated, and should instead ban problematic plastics.

The second substitute bill:

• amends definitions, including the definition of the "producer" responsible for compliance with producer responsibility organization (PRO) participation and funding requirements;
• exempts packaging for drugs used as animal medicines and products intended for animals used to treat or administered to animals that are regulated under the Food, Drug, and Cosmetic Act from PRO participation and funding requirements;
• exempts packaging for products regulated as prescription medical devices or prescription drugs under the Federal Food, Drug, and Cosmetic Act from PRO participation and funding requirements;
• specifies that the threshold for qualifying as a de minimis producer exempt from PRO participation requirements is an annual gross revenue dollar amount less than or equal to $5 million, "or," rather than "and," a total product weight less than or equal to 1 ton;
• clarifies elements of the relationship between Distributor Responsibility Organizations (DROs) and PROs, including by:  (1) requiring PRO plans to identify producers of qualifying beverage containers (QBCs) who participate in the PRO for purposes of fulfilling postconsumer recycled content (PCRC) requirements; (2) specifying that a DRO's registration with the Department of Ecology (Ecology) is the action that leads to QBCs being managed by a DRO rather than a PRO; (3) clarifying that "recyclability" product labeling requirements apply to QBCs regardless of whether they are managed by a PRO or a DRO; and (4) clarifying that a PRO may not impose fees on QBCs except for activities related to PCRC requirements and for packaging other than the QBC itself and lids or enclosures;
• specifies that fees paid by a PRO to Ecology for Ecology's administrative costs must cover the projected annual costs in the next fiscal year and must include the contractor costs related to the needs assessment, rate study, and advisory council support;
• clarifies that any rules adopted by Ecology that require covered product collection services from public places or official gatherings may apply at locations where a local government provides solid waste services, but may not include locations at which a local government does not provide solid waste services;
• delays certain deadlines for actions to be taken by a PRO or Ecology, including the deadline for the completion of the performance rates study and the statewide needs assessment;
• provides for separate recycling rates and reuse rates to be studied as part of the rate study, proposed as part of the PRO plan, and achieved as part of PRO program implementation, rather than a single combined recycling and reuse rate;
• requires a recycling rate for each material category of covered product;
• specifies that performance rates are averaged across all covered products managed by a PRO;
• specifies that recommended performance rates must consider the commercial viability and technical feasibility of achieving the recommended rates based on directly comparable real-world performance data in other jurisdictions;
• requires Ecology to consult with registered PROs in determining the final scope of the statewide needs assessment;
• requires the needs assessment to identify costs based on a county-by-county assessment, and taking into consideration the results of a survey open to all county and city governments;
• specifies that a PRO may not require any individual covered product to be reusable, recyclable, or compostable;
• requires PRO plans to include guidance necessary in order for producers to comply with new "recyclability" product labeling requirements;
• clarifies that environmental reviews for alternative recycling processes do not prohibit or affect the use of alternative recycling processes for products or packaging that are not covered products managed under a PRO;
• authorizes a PRO to use, with justification, an alternative performance rate calculation methodology than the methodology used in the performance rates study;
• provides for source reduction requirements to be measured based on the elimination of plastic components of products dating back to January 1, 2013;
• requires a PRO, in developing a system to collect fees, to consider and provide fair treatment for instances in which federal regulations constrain the use of packaging design attributes that reduce the environmental impacts of covered products;
• provides for PCRC requirements to begin applying to beverage container caps and lids on January 1, 2025, rather than at the same time as QBCs;
• applies PCRC requirements for durable goods only to durable good models designed after January 1, 2028, rather than January 1, 2025;
• authorizes the PRO to demand information from producers necessary to demonstrate to Ecology that a producer qualified for de minimis status;
• clarifies that producers of products subject to PCRC requirements under existing statutory obligations must continue to register and report to Ecology under the existing PCRC registration, fee payment, and reporting methods until a PRO registers with Ecology to fulfill PCRC obligations for participating producers;
• authorizes PROs to request an extension of certain PCRC requirements applicable to all products within a category of products subject to PCRC requirements, and authorizes Ecology to issue one-year extensions of PCRC requirements based on market conditions, PCRC availability, and technological feasibility considerations;
• clarifies that PCRC requirements for QBCs remain in effect as of January 1, 2023, rather than beginning January 1, 2024;
• exempts prescription drugs from PCRC requirements for rigid plastic household cleaning and personal care product containers and thermoform plastic containers, in addition to the exemption for prescription drugs from PCRC requirements for plastic bottles and plastic tubs;
• requires the certifications of PCRC products maintained by producers to be third-party certified only if there are adequate and commercially feasible third-party certifications for a category of product subject to PCRC requirements;
• authorizes product-specific petitions to Ecology to adjust the PCRC rate applicable to a product, or to issue a temporary exclusion, to be submitted either as part of a PRO's annual report or in a separate petition;
• clarifies that PCRC requirements for plastic trash bags do not apply to reusable plastic carry-out bags;
• requires plastic trash bag producers to develop a certificate of compliance within one year of PCRC requirements becoming applicable to a trash bag;
• eliminates the authority for Ecology to prohibit the sale of products that fail to provide a certificate of compliance for PCRC requirements;
• restores the PCRC requirements for plastic collection bins that were in the House bill but eliminated in the substitute House bill;
• delays until October 1, 2024, the deadline for distributors to register with a DRO that has registered by July 1, 2024;
• clarifies that DROs may not disseminate funds from unclaimed refunds as any form of profit to distributors;
• prohibits DROs from using funds from unclaimed refunds for legislative or political advocacy efforts that would require reporting to the Public Disclosure Commission;
• clarifies that DRO plans must achieve performance requirements specified for 2028 and 2031 beginning with the data reported for deposit return system activities carried out in those years;
• requires a DRO to submit updated plans to Ecology for review in 2031 and 2036 and directs Ecology to inform the appropriate committees of the Legislature if it deems a plan insufficient after providing a 60-day cure period for a DRO to remedy any insufficiencies initially identified by Ecology;
• adds components that a DRO must include in its plan submitted to Ecology for approval, including descriptions of how the DRO will coordinate with PROs, identify bottles that it will not accept or pay refunds for, conduct education and outreach activities, and accept and pay refunds for containers collected by material recovery facilities or other government entities;
• specifies that penalties for a DRO's failure to achieve performance requirements must be deposited in the Model Toxics Operating Account;
• specifies that the PCRC requirements applicable to drop-off bags used by the deposit return system must meet the same PCRC requirements for plastic trash bags;
• requires requests to the Department of Commerce for funds from the Recycling Revenue Augmentation Fund (RRAF) be received by July 1 for revenue losses incurred during the preceding calendar year by local governments or operators of recycling programs;
• specifies elements of the fiscal administration of the RRAF by the Department of Commerce;
• exempts the 10-cent refund value applied to QBCs from the business and occupation tax and the litter tax;
• specifies that city and county permitting and siting procedures applicable to deposit return system storage or drop-off containers must consider containers to be mobile regardless of whether they have wheels, electrical power, or are affixed to a site;
• requires Ecology to evaluate best practices in other jurisdictions and any applicable federal requirements for the labeling of items as "home compostable," and requires a report to be submitted to the Legislature by December 1, 2024;
• eliminates the directive to the Liquor and Cannabis Board to update rules pertaining to the packaging of cannabis products; and
• exempts packaging for products intended for animals regulated under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) that are not in direct contact with the FIFRA-regulated product from PRO participation requirements.

(In support) The deposit return system (DRS) is important to the bottled water system, which needs high-quality recycled plastic due to the taste-sensitive nature of the product.  The DRS system in Oregon has been successful at creating jobs and increasing recycling rates.  Most of what goes into landfills is reusable and recyclable if systems are in place to manage it.  The state needs to take the lead on a systematic approach to recycling.  Landfills are filling up.  Recycling rates have improved in the last 30 years, but progress has stalled, and it is time to bring producers to the table.  The bill would ensure products actually get recycled responsibly.  The DRS would have a positive fiscal impact and create jobs, such as for bottle washing.  The $15 million phase-out funding would help local governments recover potential revenue losses.  More containers would be recovered at higher quality.  Recent research has shown that similar programs lead to huge gains in recycling rates.  The bill would leverage existing infrastructure and industry expertise.  The language on reducing plastic waste from cannabis packaging is appreciated.  The bill should address homeowner education on home composting.  The bill would reduce litter and greenhouse gas emissions.

(Opposed)  The producer responsibility organization oversight structure has been improved, and avoids duplication of effort.  There should be greater flexibility for source reduction.  This bill gives a blank check to state and local folks and increases bureaucracy for plastic recycling.  The bill gives out-of-state producers an advantage.  Glass has high recycling rates, but the problem is getting it to a facility.  The DRS should be kept in the bill.  The DRS is based on the Oregon model, which is well-managed.  The bill should be more focused on the main goals, and avoid adding on other proposals like the litter tax study.  Too many costs are unknown or indeterminate.  A stakeholder group is needed to discuss the bill.  Wine bladders in boxes should be added to the DRS.  The bill has environmental benefits, and reduces the burden on residents for recycling.

(Other) The bill penalizes health care products regulated by the United States Food and Drug Administration, which are bound to comply with federal packaging requirements, and these products should be exempt from the bill.  There are concerns about the scope, timelines, and costs of this bill.  The inclusion of the litter tax study is welcome, but there should also be a study on the impact on overall product costs.  Smaller stores cannot afford to offset the costs resulting from this bill.  The beverage container deposit returns should be exempt from business and occupation tax.  It is unclear how long it will take for the Department of Ecology to do the required reviews of groups of products.  Packaging for animal drugs should be exempt from the bill, the same as other West Coast states.  Curbside recycling is already working as intended.  The DRS sets up a parallel system for just a small subset of the waste stream.  The DRS is a burden on members and is redundant, as many businesses are already required to pay for curbside recycling.  The DRS process is cumbersome.  The costs to producers will be passed on to consumers, which will impact low-income constituents.  Consumers are asked to spend time and effort to return bottles.  There are many undocumented costs to local governments and the state not captured in the fiscal note, such as renegotiating contracts.  The approval process for alternative recycling would limit the use of new, innovative technologies.  The bill is disruptive of the current recycling system, which has some of the highest recycling rates in the nation.  The amounts of fees that small craft brewers would have to pay is unclear, and the DRS would limit the ability of small brewers to self-distribute.  There are no off-ramps for forms of packaging that are integral for food safety and have no alternative.  The bill should align with California's treatment of packaged food.  There should be more stakeholder conversations around the bill.